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Technical Analysis • Forecasting of future financial price movements based on past price movements • Weather Forecasting-does not result in absolute predictions about the future • Helps investors anticipate what is “likely” to happen to prices over time • Uses a wide variety of charts
Chart Analysis Japanese Candlesticks
Relative Strength Index • Developed by J. Welles Wilder • Measures the magnitude of gains against the magnitude of losses over a period • Range 0-100 • Formula=100-100/(1+RS) where, RS=Average Gain / Average Loss
Conclusion • Technical Indicators work in tandem with each other • Weigh the pros and cons of each indicator before reaping the results • The best strategy forward is using technical and fundamental factors simultaneously
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