Crypto Glossary

Posted on September 13, 2021 in
Glossary

Technical Analysis

Based on market data, technical analysis is a technique or approach that may be used to anticipate the likely future price movement of security (such as a stock or a currency pair). For technical analysis to be valid, it must be supported by the notion that the collective actions – buying and selling – of all participants in the market accurately reflect all relevant information about a traded security and, as a result, consistently assign a fair market value to the security in question.

What is technical analysis?

Technical analysis is a method that is used to evaluate and anticipate the future values of securities by taking into account elements such as price movement, charts, trends, trading volume, and other factors. It is a subset of fundamental analysis. The technical analysis of an investment, as opposed to the fundamental analysis, focuses on trading signals to identify excellent investments and trading opportunities by studying the patterns of investment through its trading data and other statistical aspects.

Although current or past prices are commonly seen as the best indicators of future prices, technical analysis looks to the future price of security rather than to the current or last price. Financial charts, data, and statistics are a core component of technical analysis, which relies heavily on them to forecast trends, highlight strengths, and reveal weaknesses, allowing analysts and investors to decide if security is a good investment or not.

A broad variety of tools are available to technical analysts to identify patterns and trends on charts. Moving averages, support and resistance levels, Bollinger bands, and other indicators are examples of this. Technical traders may benefit from a variety of tools, all of which serve the same purpose: to make reading chart movements and detecting trends easier for them.

Technical Analysis Types

Top-down technical analysis:

When analysts use a top-down technique to study companies, they often start with a broad perspective and narrow it down to a more detailed one — frequently starting with a major index like the S&P 500 and progressing to sector charts and then specific weekly or hourly charts for single firms. Technical analysts continue to analyze more and more precise charts to identify whether stocks appear to be a solid long-term investment. When employing the top-down technique, technical analysts evaluate a stock or security’s moving averages in a more general-to-specific time frame, such as starting with daily averages and then going on to hourly averages for a certain stock’s price movements, before concluding their analysis.

Bottom-up technical analysis:

In contrast to the above, using a bottom-up strategy for technical analysis involves identifying potentially cheap companies and then investigating them on a more fundamental level to identify a point of entry when the stock appears to have bottomed out. To identify stocks that are defying the general market’s trend, technical analysts utilize the bottom-up method. They then seek entry and exit points that would put them in the greatest position to earn money on a specific company. 

Technical analysis in cryptocurrency

Even though technical analysis in the cryptocurrency market appears to be complicated, the word merely refers to the examination of historical market data in an attempt to forecast future price movements. In essence, it enables us to make educated estimates about whether the price of a digital asset will rise or fall in the future, based on historical data.

Technical analysis may provide cryptocurrency traders with insight into the past of a cryptocurrency, allowing them to make more accurate forecasts for the future. In most charting software, various technical analysis tools are already built-in, and you may use them in conjunction with your research to augment them. Always strive to mix technical analysis with other approaches to achieve the best outcomes.

Related Articles

What Is Phishing? How To Detect Such Scams And Prevention Methods

August 11, 2022

What Is Phishing? How To Detect Such Scams And Prevention Methods

As crypto investors, it is definitely compulsory to understand what phishing is. Click now to learn phishing methods and how to prevent them.

Ethereum Price Prediction 2022 – According To The Experts

August 11, 2022

Ethereum Price Prediction 2022 – According To The Experts

Ever since it launched, Ethereum skyrocketed to popularity and is now the second most coveted crypto token. Find out its price prediction.

Bitcoin (BTC) Price Prediction 2022 – 2030 According To The Crypto Experts

August 11, 2022

Bitcoin (BTC) Price Prediction 2022 – 2030 According To The Crypto Experts

Bitcoin Bullish or Bearish Trending Now! Let’s see Bitcoin (BTC) price prediction from 2022 – 2030 before you invest.

We offer investors a variety of opportunities in the digital assets industry. Our innovative platform provides access for anyone seeking investment returns anywhere, anytime. Our ecosystem aims at making finance an everyday enriching activity.

RISK WARNING ON DIGITAL PAYMENT TOKEN SERVICES

The Monetary Authority of Singapore ("MAS") requires us to provide this risk warning to you as a customer of Zipmex.

Before you pay Zipmex any money or DPT, you must be aware of the following.

  1. Zipmex is not currently licensed by MAS to provide DPT services. This means that you will not be able to recover all the money or DPTs you paid to Zipmex if Zipmex’s business fails.
  2. You should not transact in the DPT if you are not familiar with this DPT. This includes how the DPT is created, and how the DPT you intend to transact is transferred or held by Zipmex.
  3. You should be aware that the value of DPTs may fluctuate greatly. You should buy DPTs only if you are prepared to accept the risk of losing all of the money you put into such tokens.
  4. You should be aware that Zipmex may offer services related to DPTs which are promoted as having a stable value, commonly known as “stablecoin”.
  5. DPT held in your Hosted Wallet is not subject to the Singapore Deposit Insurance Scheme (“SDIC”) or any similar insurance or guaranty scheme of any other jurisdiction. In addition, funds stored in your Fiat Wallet do not benefit from the SDIC or any similar insurance or guaranty scheme of any other jurisdiction.

ZipUp+ products have not been approved by the Monetary Authority of Singapore (“MAS”) under the Payment Services Act 2019 and MAS has not reviewed or approved any features of these product offerings. Please review this link for the full terms and conditions and risk disclosure.