The Pillars of Technical Analysis
There are four main areas of technical analysis that analysts can objectively measure and use in trading systems. They are as follows:
Price
Volume
Time
Sentiment
There are indicators and analyses in each of these areas, and Chapter 23, “Sometimes Being Wrong Is Good”, outlines many of the more popular ones. For the purposes of introducing these concepts in this chapter, it will be sufficient to give them a general treatment.
Price is the most important of these areas; we measure profits and losses in price differences between buys and sells. It deservedly gets the most focus by analysts and academics alike, but if all four can be employed together, the odds of making successful decisions can be dramatically increased. ...
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