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Part 5

Discussion in 'Beginners Bootcamp' started by SwingTrader1, Jun 24, 2010.

  1. SwingTrader1

    SwingTrader1 Recruit

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    Technical Analysis

    Technical Analysis is used to identify where to enter a market it can also be used to identify limits and stops.

    I should have pointed out in my last article that fundamental analysis can be used for the same thing however I dont believe with as great an accuracy as technical analysis.

    In technical analysis a trader uses indicators to determine entry/exit points in the market as well as stops and limits.

    There are a numerous different indicators available and many are very good. I will cover a couple just to give an idea of how I do my technical analysis. Keep in mind this is definitely not the only indicator available and my view is just one.

    What I like to do first is identify the short term trend (is the market going up or down) I use an oscillator called Slow Stochastics. This is not the only oscillator indicator available its just the one I happen to like to use. If you go to this link List of Technical Analysis Terms Terms
    it explains many indicators and how they are used.

    Once I identify if the market is going up or down I like to "try" and find an entry point in the market. To do this I like to use price action.
    I determine where the market is in relation to previuos price then I place my trade.

    So technical analysis is used to identify trend, is the market going up/down and also where to place entries, stops and limits.

    The biggest piece of advice I would give to any aspisring trader is experiment with indidcators as much as possible until you find the right combination that will work for you.
     

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