Savings and Investments

Market Timing, Technical Analysis, and Fundamental Analysis

How does technical analysis work?

People who use technical analysis may observe certain trends in the movement of the price of a stock, as seen on a graph, that would indicate a buying or selling opportunity. The model doesn’t necessarily consider how “good” the company is, or whether or not its products are of a high quality, or whether the unemployment rate just went up. The primary focus is on analyzing the mathematical variables that may influence the trend in a price of a stock.


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