on technical analysis react too late, hence losing
about 1/3 of the fluctuations;
- Analysis made in short time intervals may be exposed to "noise", and
may result in a misreading of market directions;
- The use of most patterns has been widely publicized in the last several
years. Many traders are quite familiar with these patterns and often act
on them in concern. This creates a self-fulfilling prophecy, as waves of
buying or selling are created in response to "bullish" or "bearish"
Advantages of Technical Analysis
- Technical analysis can be used to project movements of any asset
(which is priced under demand/supply forces) available for trade in the
- Technical analysis focuses on what is happening, as opposed to what
has previously happened, and is therefore valid at any price level;
- The technical approach concentrates on prices, which neutralizes
external factors. Pure technical analysis is based on objective tools
(charts, tables) while disregarding emotions and other factors;
- Signaling indicators sometimes point to the imminent end of a trend,
before it shows in the actual market. Accordingly, the trader can
maintain profit or minimize losses.
Be disciplined, don't be greedy.
Close your Forex the position as you originally planned.