Basics

Understand all about Technical Analysis


We have already discussed what is fundamental analysis, relating to the financial market movements with real factors that affect the economy. Technical Analysis is the other common trading tool for analyzing present and historical market prices, in order to trade efficiently and gauge potential future rates. So whether you are a stock investor or a forex trader 💹, we will help you understand all about technical analysis.

What you will learn next 🎓

  • Understanding technical analysis
  • How to use technical analysis to trade forex
  • What are the best forex trading indicators
  • What is the best trading tool: AI trading or forex signals
  • How to use AI to trade forex and take advantage of the market
  • What are the best forex brokers to trade

🎯  We expect to help you invest in forex efficiently and improve your results. Get extra forex trading insights from leading finance experts on the trading Academy and on our free forex Telegram channel.

💹  When trading forex, we suggest you consider long term results.

Let’s understand technical analysis 🔬

According to the efficient market hypothesis, the price of an asset such as a forex pair contains all the information known to the market up until the present moment, including any consensus expectations about its future price direction.

Technical Analysis encompasses the art of charting historical prices on a y/x graph, where the horizontal x plane is the time series, and the vertical y-axis is the price levels of the asset.

By looking at the price of an asset plotted over time, there are many forms of the graphical analyses that can be made to gauge future price trajectories.

Forex is a popular market for applying technical analysis, due to the volume of trading that takes place each day, and the various time series of prices available to analyze, ranging from 1 minute, to daily and even monthly charts.

Example popular time frame for technical analysis in forex include:

forex the best timeframe

In addition to the time-frame, there are also many different chart types available, from a simple line chart to more complex candlestick charts which convey more information for each time interval.

forex charts

No matter which chart type and time-series you use, technical analysis enables you to choose from a multitude of potential indicators and studies that can be added to analyze your chart further. The goal of using indicators when performing technical analysis is to predict forex market movements.

There are simple indicators like the median average or weighted average price, to more complex indicators, such as Ichimoku or Regression Analysis. Many traders base their forex trading decision-making processes using these types of indicators and analysis tools.

Some of the most popular chart patterns in forex trading.

 

forex trading charts

Recognizing patterns: Support & Resistance 📊📈

While market prices may appear random or chaotic to the untrained observer, there is an n asymmetry that can be found when analyzing forex prices using technical analysis. And while these patterns, known as trends, can vary across time-frames, they look similar and are normally described as support or as resistance levels.

  • Support: a horizontal or diagonal line drawn on a chart which coincides with a level where the price of the underlying asset was supported by buyers.
  • Resistance: a horizontal or diagonal line drawn on a chart which coincides with a level where the prices of the underlying asset were resisted by sellers.
forex trading support

The same pattern observed in daily movements can be shown in tick-data or five-minute trends.

Of course, movements on such time-scales are very rapid, so it is harder to fill the information and send a market order when trading in very short time frames.

Sometimes, when the time is very small, it is only possible to trade using machine assistance, such as forex trading algorithms.

Therefore, trades supported by Artificial Intelligence (AI) make use of technical analysis, because most of the algorithms will follow price patterns and ignore news about the outside economic world. This is possible because technical analysis focuses solely on price.

From among the portals that use automated trading based on AI, Wiseinvest has an easy-to-use platform interface.

The best way to trade forex

There are two ways to invest with our AI in forex, without concern about doing technical analysis.

1. Automated with AI-Trading. Check out the 3 steps to trade automated with our AI.

 

automated trading with ai bot

By trading forex automated with AI, you will save time and improve your performance without monitoring the market and managing trading platforms.

With Automated AI trading you do not need MT4 / MT5 and other trading platforms to invest in forex. All forex trades are automatically placed into your broker account every time that our AI system identifies a new worthy trading opportunity. You can monitor the AI trading performance in real-time directly on our dashboard.

Automated AI trading benefits

  • Setup in 3 minutes.
  • Totally hands-off, from anywhere.
  • Invest from just $1.
  • APY of 40% over the past 13 years*.
  • Lightning-fast execution & no slippage.
  • No commissions, no management fees.
  • Portfolio with 40 different automatic strategies.
  • No MT4/MT5 or other platforms required.
  • Test with a risk-free practice account.
  • Trading results directly on our dashboard.

Don’t you have a broker account yet? Our AI is integrated to trade automated with the broker Oanda. Click here to open an account.

2. Manually with AI forex signals.

Wiseinvest also provides AI forex signals that perfectly fit into MT4, MT5, and any trading platform. To trade with our AI forex signals, you must simply copy the data you receive from each real-time signal into any forex brokerage account of your choice.

There are five unique variables for each AI signal, and each must be copied exactly, to match the performance of the signal as close as possible.

Each AI forex signal alert consists of the following five data points:

  • Symbol (forex pair)
  • Direction (long or short)
  • Position size (number of units or lots)
  • Take profit (price level to exit with maximum gain)
  • Stop loss (price level to exit with maximum loss)

Check out how to trade with our AI forex signals.

  1. Subscribe to a Wise-Plan.
  2. Open a Brokerage account. Check this article about the best forex Brokers.
  3. Set an amount and a position size on our Wiseinvest dashboard.
  4. Our AI will send you real-time trading alerts by email and Telegram.
  5. Copy the signals and paste into your Brokerage account.

All forex signals are sent every time that our AI trading system identifies a new trading opportunity. Our trading strategies are developed on a variety of time frames such as 4 and 8 hours.

Wiseinvest AI forex signals are Market Orders and you do not need the entry price. You can copy each signal while it is available on our dashboard. We do this way to assure that traders will just place signals while they are good to be traded.

You can trade forex with our free forex signals clicking here, or with our Premium subscription that provides you unlimited AI signals and automated AI trading in partner brokers. Whether you are a beginner or a professional forex trader, our AI trading system can help you save time and improve your trading performance. Get started with free AI.

When investing through Wiseinvest automated AI trading or AI forex signals, you do not need to calculate pips and change the leverage in your forex broker account. Learn more about leverage in forex trading by clicking here.

This is how our AI forex signals are displayed on our dashboard:

forex trading signals

While technical analysis is very popular, it can also be time-consuming, and thus using AI helps Wiseinvest customers save time, to complement their decision-making process when it comes to forex trading. If you want to do this kind of trade analysis, but don’t have the time, Wiseinvest is the best option for you.

Wiseinvest is dedicated to provide you with the educational and informational content necessary to make the right calls in the forex market.

Even if you have the time and technical skills, Wise automated AI trading and AI forex Signals can help complement your trading and help you diversify your forex portfolio. You simply copy and paste the real-time trading signals in your brokerage account at major brokers like FXCM.com.

What is the AI performance in forex trading?

The Win Rate of our AI shifts as indicated by the period and can reach up to 95%. The performance depends on the proficient wilderness estimation metric, which implies that our model is beneficial at whatever point the Win Rate is more prominent than 60%. All techniques of our AI Trading framework look for stable returns and adequate outcomes to accomplish a normal return of 40% every year (APY), without the utilization of high influences.

We comprehend that what is important in forex trading is the conclusive outcome. Along these lines, the financial specialist needs to consider that Win Rate isn’t generally the best measurement to gauge execution in forex, as other signal suppliers unveil. For example, out of 100 exchanges, it is conceivable that lone 1 exchange is sufficient misfortune to make the 99 exchanges not productive. For this situation, the Win Rate would be 99%, yet the conclusive outcome would be unfeasible (negative).

We center around the arrival of 40% of APY and not simply on Win Rate.

It is basic to see that forex brokers may charge spreads, commissions, and overnight expenses in your trading account, and these elements can influence the AI execution. You can check our forex trading history to see more about AI Trading execution by clicking here.

How much do I need to trade forex with AI?

You can begin in forex trading with free AI signals or AI Trading records and make a store from only $1 in the brokerage. It is likewise conceivable to test utilizing a hazard-free practice account with our AI Trading framework. In any case, to do a proficient hazard the board in genuine records, we recommend you start from at least $100. Notice that some forex brokers require diverse starting stores to trade forex.

What is the trading strategy of our AI?

Our AI procedure is the mix of various AI Trading frameworks, with more than 100 features, that characterize 40 distinct techniques which at the same time consider: Quotes of the 28 forex pairs, Supports, and Resistances in various time periods, Trends and Counter-patterns, Cross-markers, Index of each pair, Economic Calendar, Investors Sentiment.

Our AI examines those fundamental, technical, and sentiment factors that influence forex trading, and all models are assessed continuously utilizing various loads. In the wake of finishing the investigation, the decision of the signal emanation technique is made considering the improved probability of momentary benefit and the sum accessible for speculation.

Using technical analysis, our calculation considers not just the examples of different patterns, including backing and obstruction levels and cross-pointers, yet our AI is likewise ready to make its own ongoing record for every money pair, that is utilized to distinguish what is the best course and target.

Comparable to fundamental analysis in forex, the AI makes a connection inside the financial schedule to discover news information that can influence explicit cash sets.

Takeaways 

  • Technical analysis is purely based on prices. We do not consider news such as the production of goods, services, which are considered fundamental analysis. Only the price of assets (i.e., forex pairs) is charted across various time-frames.
  • If you want to practice technical analysis, you must be well informed, with a broad source of information and viewpoints.
  • If you do not have the time or the skills to perform technical analysis, Wise AI Trading and AI forex signals can help you find some of the best market opportunities each week.

The professional team at Wiseinvest can provide you with the best forex content to help you succeed!

Disclaimer: Forex and Contracts for Difference (CFDs) are complex instruments and come with a high risk of losing money due to leverage. Forex trading is not suitable for everyone. You should consider whether you understand how forex and CFDs work and whether you can afford to take the high risk of losing your money.

The forex brokerages displayed shall disclaim the overall performance of traders in their platforms. Oanda warns that 76.8% of retail forex traders lose money trading CFDs. XTB warns that 80% of retail forex traders lose money trading CFDs. FXCM warns that 74.74% of retail forex traders lose money trading CFDs.

The performances aforementioned are not related to Wiseinvest AI forex trading and AI forex signals system. You can check the performance of our AI forex system on our dashboard.