TECHNICAL ANALYSIS: INTRODUCTION TO THE HARDWARE OF FOREX FOR THIS TYPE OF STRATEGY OF INVESTMENT.

TECHNICAL ANALYSIS: INTRODUCTION TO THE HARDWARE OF FOREX FOR THIS TYPE OF STRATEGY OF INVESTMENT.

The technical analysis is one of the principal types of strategy of Forex, from which all kinds of imaginable strategies is defined with the use of many or few hardware. There exist some hardware of Forex that, for his utility and his successful trajectory, are of frequent use on the part of the investors and it is possible to be said that it is the basic knowledge of that one that he wants to invest in Forex using the strategy of the technical analysis (although it does not remain to say that for the one who bases on the fundamental analysis, this hardware also him is useful to know if the events and factors that influence on the foreign exchange market are of weight or do not mark a strong tendency).

This way, next we will give an introduction to some of the hardware of Forex more used in the technical analysis. The hardware is:

- Levels of Regression Fibonacci.

- Oscillators.

- The Japanese sails or Candlestick.


LEVELS OF REGRESSION FIBONACCI:

The levels of regression Fibonacci are a tool of Forex that, like all the hardware, thinks about how to find signs, which are objective, to know which it is the moment adapted to buy or to sell a currency. The Levels of Regression Fibonacci base on an ancient mathematical boss, applicable to all kinds of natural phenomena, which is useful to predict the movements of the foreign exchange market.

The theory of the application of this tool of Forex, the fact is that the persons, as well as many natural phenomena, are ruled by certain repetable and predictable bosses. This way, the psychological tendencies of the persons that they invest turn a psychology in mass that marks a predictable direction of the foreign exchange market. With the use of the levels of regression Fibonacci these mass tendencies can be identified.

This one Forex tool can help to know:

Which is the price to which finally a tendency comes before it changes his direction.

It determines all that is the period of time that one can support a tendency before it changes his direction.

With this Forex tool it is known when there is a change in the tendency.

This Forex tool works of the following way.

The mathematical series on which this Forex tool is based is a series where every number is equal to the sum of the two previous numbers, by means of the resultant series, there is a constant boss of numbers that is vital to determine the points where it is possible to present a movement in the price of the currency. This way, the series of numbers begins 1,1,2,3,5,8,13,21,34,55,89,144,233,377,610....etc. The bosses repeated between these numbers are obtained of the quotient of two successive numbers, which results in 1.618 and 0.618, which are the numbers that allow to do the calculations to apply this Forex tool.

From these numbers, it applies him to itself at the cost of a currency, taking a certain period of time, the tendency that must continue in the future in accordance with the series of numbers Fibonacci. This way, the founders of tool of Forex found that when the price this one in 38 %, 50 %, 68 %, 100 % of the basic price for the calculations, then there is a big possibility that there is a change of tendency, which is the moment of that the investor of technical analysis makes use to open his corresponding operations.

ANALYSIS OF JAPANESE SAILS OR CANDLESTICK.

This Forex tool serves principally to have a graphic version of the movement of a currency that us is useful to have a clear image of what happens in the movement of the price. Thanks to the fact that the graphs with this tool are more egg whites, it becomes easier to recognize the patterns that are moving on the market. The Japanese sails are a few bars that are composed by the point of opening, the maximum point, the minimal point and the point of closing of the price of a currency. When the bars are colored of green it means that the price of the currency has increased, when they are colored of red means that the price to diminished citing as an example the opening price.

In the following article we will continue with the introduction to the hardware of basic Forex for the application of the fundamental analysis.



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