Energies Technical Analysis is Based on 3 Factors Common in the Energies Trading Market:
1. Energy Price Moves in Trends
Energies trading price movements follow trends. This means that after a energies trend has been established, the future energies market price movement is more likely to be in same direction as a energies trend than to be against it. Most energies strategies are based on this energies technical analysis concept - energies trend trading.
2. Energies Price Movement Discounts Everything
Energies trading technical analysis only considers energies price movement and assumes that, at any given time, energies price reflects everything that has or could affect the energies trading instrument including even the fundamental factors. This only leaves the study of energies price, which is a product of the supply and demand for a particular energies instrument in the energies market.
3. History Tends to Repeat Itself
History repeats itself mainly in terms of energies price movement. The repetitive nature of energies market movements is attributed to energies traders investor psychology; in other words, energies trading participants tend to provide a consistent reaction to the energies market most of the time. Energies trading technical analysis uses energies chart patterns to analyze these energies price movements. Although these energies charts represent historical data they are still relevant because they illustrate energies chart patterns that often repeat themselves.
Understanding this energies technical analysis of the energies trading market can be a valuable energies tool in determining the energies trend of any energies market and assisting with entry and exit levels for your energies trades.
The goal of these energies technical analysis methods is to help energies traders determine when the energies market is trending, and when it is not. If the energies instrument is moving in one particular direction, then we want to be on board. If the energies trading instrument is not moving in a particular direction, all you are going to do is lose money as you will get whipsawed around and this is not what we want as energies investors.
Unfortunately, many traders fight the energies trend and buy or sell in the opposite direction of a this energies trend direction, trying to pick a top or a energies market bottom, only to see the energies market move further in direction of the trend.
Another common mistake energies traders often make is adding on to a losing energies position, averaging a loss. This is not a good energies strategy especially in a strongly trending energies market. It is something that experienced investors never do. The energies trend is your friend, never go against it.
This energies technical analysis studies alert investors of energies setups and there are no certainties in financial energies market. Profits come from using proven energies strategies & energies methods to find a trending energies and taking energies trades in the same direction of the trend.
With so many energies investors using similar energies tools, energies technical analysis can become a self fulfilling prophecy. If many energies investors use the same levels as a buying point, the energies price goes up as everyone will make similar energies technical analysis moves. However, the question is always how long these energies moves will last?
Understanding this energies technical analysis methods will give the energies charts some meaning when you look at them and apply energies technical analysis. Energies trading technical analysis will help you understand why certain energies price movements occurred.
Energies trading charts are used with energies technical indicators to look for energies chart patterns that have occurred in the past under certain conditions. When these conditions are noted again, you can use the past energies chart patterns studies to make a buy or sell decision.
Some of the most common energies technical indicators include: Energies Technical Analysis Explained
- Moving Averages Technical Indicator
- Relative Strength Index Technical Indicator
- Stochastic Oscillator Technical Indicator
- MACD Technical Indicator
- Energies Fibo Retracement Indicator
- Bollinger Bands Technical Indicator
Most energies technical indicators are shown separately from the energies chart usually below it. This is because these indicators often use a different scale than that of the energies trading price chart.
Some of the technical indicators are shown on the energies price chart itself, such as Moving Averages and Bollinger bands - these indicators are referred to as energies trading price overlays.
Explanation of these indicators is found under the topic: List of All Energies Technical Indicators - Energies Technical Analysis Trading Tutorial - Learn Energies Technical Analysis Tutorial - Energies Technical Analysis Examples
SUMMARY
- Energies Technical Analysis Relies on Defining Probabilities
- Energies Technical Analysis Uses History of Energies Price Patterns
- Energies Technical Analysis Uses Several Analytical Tools (Energies Trading Indicators)
- Energies Technical Analysis Uses Energies Trading Chart Patterns
How to Trade Energies Trading With Energies Technical Analysis Guide
Most energies traders prefer technical analysis - learning the energies technical analysis methods also takes time to learn due to its nature which involves abiding by the energies technical rules.
To learn how to trade energies successfully, it is important that you understand the 3 strategies, outlined below:
1. Energies Trading moves will always follow a energies trend which can be identified by looking at the energies chart patterns or the energies candlesticks charts. If any energies investor tells you that you can also profit from the counter-trends consistently it will not be possible because the energies trend is the only proven method of making money in the energies market.
2. The market forces will drive the energies instrument energies prices up or down depending on supply and demand. Energies trading technical analysis seeks to measure the demand supply of a energies trading instrument using various energies technical analysis tools & energies indicators. The demand supply is reflected in the energies price action. Therefore, by simply looking at the energies price movements themselves you can try and predict what direction the energies price is likely to move towards using one or two energies technical indicators - energies technical analysis indicators like the moving average or support and resistance levels energies indicators.
3. The energies market not only shows the history of the past energies prices, but will also follow the energies trend that was in place, until its energies trend direction reverses. Some very important energies indicators used to determine these energies market movements are Moving Averages, MACD and Bollinger Bands Energies Indicators.
When energies price starts to consolidate, which means there is no energies trend, you should use a different approach to analyze the energies market. You should use support and resistance levels and breakout energies strategies to analyze the ranging energies market energies prices.
When the energies market retraces, you should use energies chart patterns and energies technical indicators to analyze whether the current energies trend will continue or reverse.
