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Technical Analysis Talking Points:

- Technical analysis is a popular field of study for FX and Commodities traders as it helps to make trading decisions with an eye on risk management.

- DailyFX produces a plethora of research and education on this topic, and this article goes over some of the more popular resources available to traders, each of which are no cost and available to all.

- DailyFX Forecasts on a variety of currencies such as the US Dollar or the Euro are available from the DailyFX Trading Guides page. If you’re looking to improve your trading approach, check out Traits of Successful Traders. And if you’re looking for an introductory primer to the Forex market, check out our New to FX Guide.

Do you want to see how retail traders are currently trading the US Dollar? Check out our IG Client Sentiment Indicator.

Technical Analysis at DailyFX

Trading may seem simple on its face because almost every human being on Earth has the same ability to left-click on the mouse a couple of times to open and close a trade. And given that the future is truly uncertain, it can seem as though a brand new trader has the same chance of winning on any given trade as even the most grizzled of market veterans. But, with time and enough examples, it often becomes clear that there is more to it than just picking the right market and ‘guessing’ correctly a certain number of times. There’s strategy, and technique, and a plethora of ways to go about ‘trying to see around the next corner’ in order to attain desirable results; and like most other endeavors in life, this usually takes time and a build of experience for an individual person to learn how to best do this for themselves.

One of the keys often incorporated along the way is technical analysis, or the premise of using the chart and past price movements to help make trading decisions. Technical analysis is simply an examination of the past, and this is often done with the chart to try to identify patterns or scenarios that could give the trader ideas as to how to best move forward in a given market.

At DailyFX, our analysts and strategists feature several different methodologies and practices; and given the mountain of content produced by the site every month, it can be difficult to keep track of or access those resources. In this article, I’m going to list out some of the more popular items so that traders looking to get started in this field of study will have an abundance of resources from which to draw from.

How Technical Analysis Can Help Traders

Before getting into the actual resources themselves, there is an important caveat to address: Technical analysis is not a prediction tool. Given that this analytical field merely examines what’s already happened, it would be nonsensical to argue that the past perfectly predicts the future. New stuff happens, and things change; and while history often rhymes, it rarely repeats with perfection - and this is where technical analysis can help.

One of the reasons that technical analysis garners its popularity is because of its ability to help with risk management, which is a key stumbling block that separates many new traders from their experienced counterparts. This was the primary premise in the DailyFX Traits of Successful Traders series, in which it was identified that many retail traders will often have winning percentages of greater than 50%. But, these same traders lose so much more when they’re wrong than they win when they’re right that, at the end of the day, they end up staring at a red net loss.

Technical Analysis Assistance with Risk Management

Technical analysis can help with risk management: Because if a trader has a bullish bias on a market, they can wait for support to show, at which point stops can be set below the support level. If that bullish bias plays out, and prices run-higher, the trader can then scale-out of the position at a more favorable price. But if, on the other hand, that bullish bias does not play out, the trader can be taken-out of the move with the goal of loss mitigation as that idea ‘didn’t work.’

Free Trading Guide: DailyFX Traits of Successful Traders

Rather than trying to constantly outguess the markets, in which prices are often set by banks and followed by some very sharp professionals that have made careers of making markets; the retail trader will often make more efficient strides towards desirable results by focusing on risk-reward ratios. Or, to put it otherwise, risking a Dollar to try to make two. That way, even if the trader only ‘guess right’ 40% of the time, the possibility of a net profit can still remain.

DailyFX offers a plethora of education on this field as well, but the topic for this article is technical analysis so the following paragraph will get back on-point. But for those that would like to read more, the article linked below can help:

DailyFX: The ABC’s of Risk Management

Getting Started with Technical Analysis: Learning The Basics

DailyFX offers the ‘Forex University’ in which a curriculum is designed based on previously-published educational pieces. The outlay is broken up into four parts, with beginner, intermediate, advanced and expert levels. This is available to anyone that might want to access it without any paywalls or hoops to jump through. You can simply click on the link below to be taken to the introduction.

Forex University – Beginner Level

Technical analysis makes its appearance in the second of those modules, during the intermediate section entitled ‘Technical Analysis (Reading the Charts),’ and that can be accessed from the link below:

Forex University – Intermediate Level

Price Action

A field within technical analysis that is quite popular on DailyFX is price action, which is the study of price movements without the assistance of indicators. This is a topic that I’ve taught for a while to our readers, and the article series from 2012 continues to attract views. Below, I’ve listed out a series of links that can help to uptake understanding of this field of technical analysis.

Capstone: The Forex Trader’s Guide to Price Action

Price Action, an Introduction

Price Action Swings

Price Action Breakouts

Price Action Pin Bars

How to Identify Positive Risk-Reward Ratios with Price Action

Trading Trends by Trailing Stops with Price Swings

The following link looks at incorporating this education into a swing-trading strategy revolving around the Four-Hour price chart.

The Four-Hour Trader, A Full Trading Plan

(Webinar Series) Foundations of Technical Analysis: Constructing a Trading Strategy with Technical Methods

My colleague Michael Boutros has put considerable work into his Foundations of Technical Analysis webinar series in which he hosts bi-weekly sessions on Fridays. If you’d like to sign up for future events, Michael will be ready to restart these sessions after the open of the New Year, and you can locate those directly on the DailyFX Webinar Calendar.

Through the webinars, Michael goes over a wide range of topics from building a trading strategy using technical analysis to trading psychology and constructing a trade setup. Below, I go over links for each of these sessions. The main capstone article, listed first contains links to even more archived webinars on the topic.

Capstone: Foundations of Technical Analysis, Building a Trading Strategy

Constructing a Trade Setup, Part 1

Constructing a Trade Setup, Part 2

Foundations of Technical Analysis: Examining Near-Term Price Action

Foundations of Technical Analysis: Trading Psychology

Becoming a Better Trader Webinar Series with Paul Robinson

My colleague Paul Robinson conducts bi-weekly webinars entitled ‘Becoming a Better Trader’ in which education is front-and-center; and given Paul’s technical leanings, technical analysis plays a key role in the content. If you’d like to sign up for future webinar events, Paul hosts these sessions on Thursday morning and these will be listed appropriately on the DailyFX webinar calendar. I’ve listed out below a series of archived webinars that contain a plethora of learning points.

Becoming a Better Trader, How to Construct a Trading Plan

Becoming a Better Trader, High Probability Chart Patterns

Becoming a Better Trader: Developing Consistency

Becoming a Better Trader: Utilizing Multiple Time Frames

Becoming a Better Trader: Principles of Risk Management

Elliott Wave with Jeremy Wagner

Atop the DailyFX Education sphere is our own Jeremy Wagner, who specializes in a specific field of technical analysis called Elliott Wave. Jeremy has attained the Certified Elliot Wave Analyst Master (CEW-M) designation from Elliot Wave international, and he incorporates this in his analysis published through DailyFX.

This is a fairly-wide field of study, so rather than providing a litany of links, Jeremy has condensed this education as a trading guide, which is available at no cost to anyone that might want it. There are two guides that Jeremy has authored, a beginner level and a more advanced version. Each are linked below, and to access, you can simply click on the below link and check the appropriate box for ‘Elliot Wave for Beginners,’ or ‘Elliot Wave for Advanced Users.’

Elliot Wave for Beginners

Elliot Wave for Advanced Users

To read more:

Are you looking for longer-term analysis on the U.S. Dollar? Our DailyFX Forecasts for Q4 have a section for each major currency, and we also offer a plethora of resources on USD-pairs such as EUR/USD, GBP/USD, USD/JPY, AUD/USD. Traders can also stay up with near-term positioning via our IG Client Sentiment Indicator.

Forex Trading Resources

DailyFX offers a plethora of tools, indicators and resources to help traders. For those looking for trading ideas, our IG Client Sentiment shows the positioning of retail traders with actual live trades and positions. Our trading guides bring our DailyFX Quarterly Forecasts and our Top Trading Opportunities; and our real-time news feed has intra-day interactions from the DailyFX team. And if you’re looking for real-time analysis, our DailyFX Webinars offer numerous sessions each week in which you can see how and why we’re looking at what we’re looking at.

If you’re looking for educational information, our New to FX guide is there to help new(er) traders while our Traits of Successful Traders research is built to help sharpen the skill set by focusing on risk and trade management.

--- Written by James Stanley, Strategist for DailyFX.com

Contact and follow James on Twitter: @JStanleyFX