Technical analysis is done on the basis of historical price movement plotted on a two-dimensional chart. One reason it has become popular is that anybody can look at the chart and see how prices have moved.

2. Analysis of statistics generated by market
activity such as past price and volume to come
up with reasonable outcome in future using
charts as a primary tool.
Should I take a long position? Should I take a
short position? What is going to be the price
tomorrow, next week or next year?
Introduction

3. The market discounts everything
Prices move in trends
History tends to repeat itself
Assumptions

4. Line chart
Type of Charts

5. Bar Chart
Type of Charts

6. Volume Bar Chart
Type of Charts

7.  Candlestick Chart
Type of Charts

8.  The meaning of trend in finance isn't all that different from
the general definition of the term - a trend is really nothing
more than the general direction.
 A trend represents a consistent change in prices (i.e. a change
in investor’s expectations)
 A trendline is a simple charting technique that adds a line to a
chart to represent the trend in the market or a stock.
Trends

9. Uptrends
Types of Trend

10. Downtrend
Types of Trend

11. Sideways Trend
Types of Trend

12. Support and Resistance
 Support level is a price level where the price tends to find
support as it is going down

13. Support and Resistance
 Resistance Level is a price level where the price tends to
find resistance as it is going up

14. Importance of Support and Resistance
Support and resistance analysis is an important part
of trends because it can be used to make trading
decisions and identify when a trend is reversing

15. Aware: Support and Resistance levels
Support and Resistance levels are highly
volatile
Traders should not buy and sell directly at
these points as there may be breakout also

16. Breakout
The penetration of support and resistance level
is called breakout

17. Trader’s Remorse
Returning to the level of support or resistance
after a breakout is called trader’s remorse.

18. Trader’s Remorse

19. Resistance <-> Support

20. Indicators
A mathematical tool that can be applied on security’s
price giving a result that can be used to anticipate
trends, volatility and price
Indicators are used in two main ways: to confirm
price movement and to form buy and sell signals

21. Types of Indicator
Lagging
This indicator simply tells you what prices are
doing, they don’t warn you of upcoming changes
Leading
This indicators attempt to make investment calls on
securities prior to actual price confirmation

22. Moving Averages
 A simple moving average is calculated by taking
average of most recent closing prices of n time period
 Exponential Moving average applies weighting
factors which decrease exponentially

23. Moving Averages

24. Moving Averages Convergence Divergence
 MACD is calculated by subtracting 26 days moving
average from moving average of 12 days

25. Trading using MACD
 A 9 day moving average of MACD is plotted along
with MACD

26. Bollinger Bands
 Bollinger bands are the envelopes plotted at standard
deviations above and below the moving average
 Bollinger Bands can be used to measure the highness
or lowness of the price relative to previous trades

27. Bollinger Bands

28. Bollinger Bands

29. Elliot Wave Theory
 Elliot stated that stock market moves in
repetitive cycles

30. Impulse and Corrective Patterns
 The impulse pattern consists of five waves, the
five waves can be in either direction, up or
down
 Corrective patterns can be grouped into two
different categories:
• Simple Correction( Zig-Zag )
• Complex correction (Flat, Irregular,
Triangle)

31. Fractal Structure
 The structures Elliott described meet the
common definition of a fractal ( self-similar
patterns appearing at every degree of trend)
 Elliott Wave patterns that show up on long
term charts are identical to, and will also show
up on short term charts

32. Fractal Structure

33. Fibonacci Retracement Patterns
 Stocks often pull back or retrace a percentage
of the previous move before reversing
 Retracement percentages follow a Fibonacci
ratio pattern, the key Fibonacci ratios are 23.6,
38.2, 50, 61.8

34. Fibonacci Retracement Patterns

35. Linear Regression Lines
 When prices are below the Linear Regression Line, this could
be viewed as a good time to buy, and when prices are above
the Linear Regression Line, a trader might sell

36. Linear Regression Channel
 A Linear Regression trendline shows where equilibrium exists
but Linear Regression Channels show the range prices can be
expected to deviate from a trendline

37. Relative Strength Index
 It compares the magnitude of recent gains to recent losses in an
attempt to determine overbought and oversold conditions of an
asset
RSI= 100- 100/ (1+RS)
RS=EMA[U]/EMA[D] EMA- exponential moving
average
U= Sig (close (today)-close (yesterday))
D= Sig(close(yesterday)-close(today))

38. Relative Strength Index
Relative Strength Index

39. Stochastic Oscillator
 Compares where a security’s price closed
relative to its price range over a given time
period
Fast oscillator
Slow oscillator %D = SMA(%K, N)

40. Stochastic Oscillator
 Buy when the Oscillator (either %K or %D) falls below a specific level
(e.g., 20) and then rises above that level. Sell when the Oscillator rises
above a specific level (e.g., 80) and then falls below that level;
 Buy when the %K line rises above the %D line and sell when the %K line
falls below the %D line

42. Thank You