The Advantages of Price Action (Technical Analysis)

OANDA:EURUSD   Euro / U.S. Dollar
Technical Analysis ( AKA Price Action)

Technical analysis is the understanding and observing of markets through the only thing that matters; price. Prices generate similar patterns over time, in every market. A single price chart contains more information than you would ever imagine at first glance. Everything you need to know about any company, or market is on the chart in front of you. The current price is what the true value of the market is, regardless of news, indicators, or anything else.

The Advantages of Technical Analysis (Price Action)

No News - Everything you need to know is on the chart in front of you. Completely disregard all news and outside information. All news is already built into the current price. The price action of the market is all you need to know. Once you understand how institutions operate, you can follow them.

No indicators. All indicators are a derivative of price. For example a Fibonacci level. Every price on a chart is a Fibonacci level of some other price on the chart. Although they appear to work, these levels do not work because of Fibonacci. But instead due to the traders equation, which is the mathematical formula institutions use to enter and manage trades.

Clearly define support and resistance . You can see on a chart where prices are likely to do something. These are "Key entry points" or "Buy and Sell Zones."

Clearly define risk and edge. With technical trading, you have the ability to define your risk before getting into a trade. If the market does not do what you expected, and instead goes beyond your stop, you exit. Without needing to wonder about why this happened, or constantly observing the news.

Identify the strongest markets without relying on outside information like news, indicators, someone else, or a "tip." Become independent and trade for your self.

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