Let's start with the assumption underlying the technical analysis. In this case I would take an extreme approach so that you can understand how a technical analysis usedin obtaining the gain/profit on forex trading. Of course in practice it is not so. You cancombine both analysis (fundamental and technical) in order to obtain a tradingsystem that is best for you.
The chartist (parties who perform technical analysis), believe that they can figure outthe patterns of price movement rate at a future date with based on the observations of the movements of the exchange rate in the past. In short they hold this jargon:"History always repeats it self." This philosophy is of course contrary to the fundamentalists in which investment decisions over the value of a currency is based on the fundamental factors for economic, political and monetary is concerned.
The main weapon of the technical analyst is a graph (chart – that's why they called the chartist). Through the chart this is they can look at the trends that are taking place, a span of trend, the volume of transactions and the psychological levels. If youhave been able to know 4 things, of course huge profits soon will be gushing to payyou. Let me Re:
1. Trend
2. Transaction Volume
3. Level the psychological (support and resistance)
4. The period of time that happens.
