TA (Technical analysis)

Technical analysis involves looking at the past of a stock price to predict the future.

Two methods are generally used to analyze quotes:

  • Technical analysis
  • fundamental analysis.

Technical analysis focuses on patterns and trends of a stock price. Fundamental analysis has more to do with the underlying factors. With crypto, one such underlying factor is, for example, how healthy a blockchain is: how active are its users and what does this blockchain add? When investing in stocks, there is often more information to be found that enables fundamental analysis. After all, companies publish quarterly figures, the directors of companies are often better known, and laws and regulations can affect the share price.

Technical analysis involves looking purely at the stock price. It assumes that the market has already performed fundamental analysis and that decisions are made based on the analysis. In this way, patterns are recognized and conclusions are drawn. For example, an investor may see that a stock price is relatively low and volume doubles three days in a row. If an investor has seen this before, he can conclude that this pattern will continue for a week. This will be a reason for the investor to buy in. There are several tools used in technical analysis. It depends on the investor which instruments are used.

Both forms of analysis are predictions and do not guarantee success.