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Common technical analysis tools for foreign exchange technical indicators
Relative Strength Index (RSI): The calculation method of RSI is to accumulate the sum of the rising price range and the falling price range in a certain period of time, and then remove the ratio between them, and the value range is 0- 100. If RSI is greater than or equal to 70, it means that wealth management products are overbought (the price increase exceeds market expectations). When RSI is less than or equal to 30, it can be considered that the wealth management product is oversold (the price drop exceeds market expectations). Random: the random activity range is between 0- 100%, reflecting the overbought/oversold situation. In a strong rise, the closing price will close at a high price. On the contrary, it will be low when it falls. Stochastics uses the graphic relationship analysis composed of %K and %D curves to judge the price trend, which mainly reflects the overbought/oversold phenomenon in the market; At the same time, the intersection of %K and %D curves also gives the signal of buying and selling. In addition, the "deviation" between randomness and exchange rate can give useful trading signals. Similarities and differences smma (MACD): This indicator includes two dynamic trend lines drawn. MACD line is the difference between the moving average of two indicators and the difference between signal line or trigger line, which is the smma of the difference. If MACD crosses the trigger line, it can be seen as a signal that the market trend has changed. Number theory: Fibonacci sequence: Fibonacci sequence (1, 1, 2, 3, 5, 8, 13, 2 1, 34 ...) consists of the first two digits. The ratio of any number to the next larger number is 62%, which is the famous Fibonacci callback number. The reciprocal of 62% and 38% is also regarded as Fibonacci callback number. W.D. Gann was a stock and commodity trader in 1950s. He was famous for earning more than 50 million dollars in the market. He traded financial instruments with his own developed method and earned huge wealth. This method is based on the relationship between price trend and time, and is called current price equivalence method. Gann's method is not easy to explain, but its essence is that he uses the angle in the chart to get the support level and resistance level and predict the time when the futures trend changes. He also predicted the support level and resistance level with the lines in the chart. Wave Elliott Wave Theory: Elliott Wave Theory is a market analysis method based on repeated wave morphology and Fibonacci sequence. The ideal Eliot wave model has five rising waves followed by three falling waves. The gap window is the price area where no transaction occurs on the graph. When the lowest price of a trading day is higher than the highest price of the previous day, an upward gap will be formed; When the highest price of the day is lower than the lowest price of the previous day, a downward gap will be formed. An upward window usually indicates that the market is strong, while a downward window indicates that the market is weak. Breaking the gap is a price window formed after the completion of important price models, which usually marks the beginning of important price trends. Runawaygap is a price window, which usually appears in the middle of important market trends. Therefore, it is also called measuring gap. Exhaustiongap is a price window that appears at the end of an important trend, indicating that the trend is coming to an end. Trend trend refers to the trend of price rise and fall. When the market price hits a new high continuously, it is regarded as an upward trend; A persistent low point is considered a downward trend. The breakthrough of the trend line usually marks the end or reversal of a trend. Horizontal peaks and valleys indicate the price range of the market. In order to identify trends and support and resistance levels, moving averages can be used to smooth price information. Trends are very useful in determining trading strategies, especially in futures trading or markets with strong upward or downward trends. The most commonly used technical tools are: CoppockCurve is an investment tool used to predict the low point of bear market in technical analysis. DMI (Trend Indicator) is a commonly used technical indicator to judge whether a group of currency pairs are in a trend. Unlike fundamental analysts, technical analysts pay little attention to the "global" factors that affect the market, but pay attention to the market activities of specific financial instruments.