Definition of Technical analysis:
Unlike fundamental analysis, which attempts to evaluate a security's value based on business results such as sales and earnings, technical analysis focuses on the study of price and volume. Technical analysis tools are used to scrutinize the ways supply and demand for a security will affect changes in price, volume and implied volatility. Technical analysis is often used to generate short-term trading signals from various charting tools, but can also help improve the evaluation of a security's strength or weakness relative to the broader market or one of its sectors. This information helps analysts improve there overall valuation estimate.
Financial analysis that uses patterns in market data to identify trends and make predictions.
General: Examination and evaluation by experts of materials, processes, practices and other factors associated with economy, efficiency, effectiveness, or safety.
Trading: One of the two basic techniques (the other is fundamental analysis) used by commodity and stockmarket investors/speculators to estimate price movements. Technical analysts (also called chartists or technicians) believe that (in case of stocks) the intrinsic value of a firm or its estimated earnings-potential, and (in case of commodities) the demand and supply information, is insufficient to predict its future prices. Instead, they rely on statistical methods and collective (mob) psychology techniques, and use data charts and computer programs, to study past movements in prices and trading volumes to detect current and future trends. Most technical analysis is short- or intermediate-term, and is based on three major tenets: (1) history repeats itself what goes around comes around, (2) prices move in trends and usually follow known patterns, and (3) current market price of a stock (share) or commodity reflects the effect of all available information about it.
Technical analysis is a trading discipline employed to evaluate investments and identify trading opportunities by analyzing statistical trends gathered from trading activity, such as price movement and volume.
How to use Technical analysis in a sentence?
- Technical analysts believe past trading activity and price changes of a security can be valuable indicators of the security's future price movements.
- Technical analysis is a trading discipline employed to evaluate investments and identify trading opportunities in price trends and patterns seen on charts.
- He reads up on company fundamentals and news as a way to double-check his technical analysis.
- Technical analysis may be contrasted with fundamental analysis, which focuses on a company's financials rather than historical price patterns or stock trends.
Meaning of Technical analysis & Technical analysis Definition