Technical Analysis

Basics Analysis - Trading Alternative methods Examples Discussion

Basics The market discounts everything Chart types Simple tools

The market discounts everything TA is... a research approach, using only historical prices. the study of prices, with charts being the primary tool. a self fulfilling prophecy.

The market discounts everything TA assumes that… every information is in the market. we cannot predict the future, but react on the market. we don’t ask for the ‚WHY‘, but for the ‚WHEN‘ and ‚WHERE‘. we don’t want to understand the market, we just want to make money with it.

The market discounts everything TA has one target: Discipline

Function of value Value Profit Loss 1 x ~2x

Implications: Effect of disposition open position LOSSPROFIT Risk-seeking -> HOLDRisk-aversion -> GET OUT

Chart types Line charts Bar charts Candlestick charts

Simple tools trend channels support - resistance retracements others

trend channels

Support - Resistance

Simple tools Retracements  Using the Fibonacci - numbers: 0, 0.382, 0.618, 1  often also used: 1/3, 1/2, 2/3

Retracements

Analysis Indicators Oscillators Volatility

Indicators Moving Averages simple MA weighted MA exponential MA

Moving Averages

Indicators MACD MACD-line: EMA short-term – EMA long-term Trigger-line: EMA (MACD-Line)

MACD

Oscillators Momentum Stochastics many more (RSI, ROC, …)

Momentum

Stochastics

Volatility

Trading Noise Trading Technical Trading System Trading

Pre-ECB sideways market High: 107,23 Low: 107,62

Systems defined entry-signals winning trades - defined exit-signals loosing trades - defined exit-signals money management

Combined techniques

Alternative Methods Fibonacci Elliott Wave Theory Japanese Candlesticks

Fibonacci numbers n F(n) F(n) = F(n-1) + F(n-2) for n   : F(n-1) / F(n) = phi = …

Fibonacci Retracements

Elliott Wave Theory 5 waves in direction of main trend 3 corrective waves The underlying 5-3 pattern remains constant, though the time span of each may vary.

Elliott Wave Theory

Japanese Candlesticks

Examples

Real-time example

Conclusio Information is pretty thin stuff, unless mixed with experience.