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Join NowMarket analysis is an important part of trading as it helps you predict the future market trend.
There are two main way to analyse the market: Foundamental and Technical
Foundamental analysis is based on factors such as the economy and the political risk associated with the instruments, while technical analysis only concerns the price movement
No matter which analyse you prefer, you are most likely to use both analysis to develop your strategy.
This article will focus on technical analysis.
Technical analysis use history price of the instrument to predict the future market trend. But as the history will not always reflect the future, this analysis should not be used in the vacuum and need to be used with with other analysis and tools.
One of the most common and basic technical analysis involved using the K-line.
By using K-line, you can observe and identify certain repeating pattern in the market and do it to predict future trend of the market.
Let's say a certain share consistently bounce back at a certain price level, then we can assume that the next time the share reaches that particular price level, it will probably (though not certain) rebounce once again.
From a technical standpoint, we will consider this price level as a support level.
