Technical Analyst

What is a 'Technical Analyst'

A technical analyst, or technician, is a securities researcher who analyzes investments based on past market prices and technical indicators. Technicians believe that short term price movements are the result of supply and demand forces in the market for a given security. Thus, for technicians, the nature of the security is less relevant than the current balance of buyers and sellers. Based on careful interpretation of past trading patterns, technicians try to discern this balance with the aim of predicting future price movements.

BREAKING DOWN 'Technical Analyst'

Over time, technicians have developed a large toolbox of analysis techniques and indicators. In general, one technical indicator usually not seen as enough of a basis for making a trading decision. Rather, arrays of indicators are used to provide confirmation of a technician's hypothesis before taking action. There is generally no broad consensus on the best method of identifying future price movements, so most technicians gradually develop their own set of trading rules based on their knowledge and experience.

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RELATED FAQS
  1. What types of data are necessary to make a technical analysis?

    Understand what technical analysis is, the basic theory behind employing it and what data inputs are needed to conduct it. Read Answer >>
  2. How do I start using technical analysis?

    Technical analysis is a method of analyzing securities by evaluating current and historical price and/or volume activity. ... Read Answer >>
  3. How do traders identify confirmation of prices on a chart?

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  4. How is the Parabolic SAR used in trading?

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