Technical analysis is the framework in which forex traders study price movement.
The theory is that a person can look at historical price movements and determine the current trading conditions and potential price movement.
The main evidence for using technical analysis is that, theoretically, all current market information is reflected in price.If price reflects all the information that is out there, then price action is all one would really need to make a trade.
Technical analysts look for similar patterns that have formed in the past, and will form trade ideas believing that price will act the same way that it did before.
![](https://bpcdn.co/images/2016/05/pre-school-technical-analysis-thumbnail.png)
In the world of currency trading, when someone says technical analysis, the first thing that comes to mind is a chart.
Technical analysts use charts because they are the easiest way to visualize historical data!You can look at past data to help you spot trends and patterns which could help you find some great trading opportunities.
As more and more forex traders look for certain price levels and chart patterns, the more likely that these patterns will manifest themselves in the markets.
You should know though that technical analysis is VERY subjective.
The theory is that a person can look at historical price movements and determine the current trading conditions and potential price movement.
The main evidence for using technical analysis is that, theoretically, all current market information is reflected in price.If price reflects all the information that is out there, then price action is all one would really need to make a trade.
Technical analysts look for similar patterns that have formed in the past, and will form trade ideas believing that price will act the same way that it did before.
![](https://bpcdn.co/images/2016/05/pre-school-technical-analysis-thumbnail.png)
In the world of currency trading, when someone says technical analysis, the first thing that comes to mind is a chart.
Technical analysts use charts because they are the easiest way to visualize historical data!You can look at past data to help you spot trends and patterns which could help you find some great trading opportunities.
As more and more forex traders look for certain price levels and chart patterns, the more likely that these patterns will manifest themselves in the markets.
You should know though that technical analysis is VERY subjective.
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