The technical analysis is a way in which traders analyze the price trend of the market and then have a forecast on future trends. The price trend is analyzed using graphs and analysis principles that try to highlight investor sentiment.
This type of analysis was initially applied to the stock market, but was later extended as a method of examining the currency market, for commodities and other existing financial instruments.
The other way to carry out market tests is the fundamental analysis, which instead studies the phenomena that can impact on the price.
With fundamental analysis, traders look at the important political and economic events that are expected for the current trading session. Based on them we try to understand how the price will evolve and what the trend will be.
A different way to try to understand the evolution that will take place on the market.
There is no best method between the fundamental and the technical, but it is the investor who decides how to carry out his analysis. Important elements to make a choice are also the experience and the type of trading that is carried out, but usually those who apply fundamental analysis combine it with the technical one.
