Overview of Technical Analysis

Technical analysis is the most important thing in trading. In this post we learn the insights of technical analysis of the stock market in very simple language. There is a lot of information about technical knowledge on the internet, so it can be difficult to know what to avoid or what to gather.

To prevent confusion, I have only included information that is truly necessary for market analysis in this post. That means only share important aspects of the TA.
Firstly, when entering the stock market, one should understand that technical analysis and fundamental analysis are two completely different kinds of things.

Fundamental vs. Technical Analysis-
Technical analysis only forecasts future price movement based on past price patterns, whereas fundamental analysis examines a company's balance sheet to determine its profitability, debt, future planning, and other factors. Technical analysis is better work for trading purposes only.
If anyone comes for a long-term view, that means investing in a stock for long-term company analysis, market analysis, and economy analysis, then they must go for fundamental analysis.
In technical analysis, the risk-reward ratio plays a very important role. That means every trader should maintain a 1:3 risk-reward ratio for overall profitability. One day's loss or profit does not decide overall profitability or loss in the market. Keep in mind that money management is the key in the stock market.

There are two types of trading:

1) Intraday trading:

Creating a position one day and closing it that same day is known as intraday trading. One thing everyone should understand is that intraday trading is very risky, and at a beginner level, one should avoid intraday trading at his beginning stage. Intraday trading is a very advanced level of trading, and that requires a lot of experience, special skills, and the ability to take quick decisions. But consistent learning helps to make quick decisions. Intraday trading is the last stage of trading. but we are starting it with beginnings and ending up in heavy losses. For intraday trading, a short-term time frame is beneficial, that is, 5 min, 15 min, etc. Overall, the summary is that technical analysis plays a very important role in intraday trading.

2) Swing trading-
Swing trading is the form of trading that involves making a position or buying a stock and holding it in our portfolio for several days or several weeks to several months. The probability of making profit in swing trading is higher compared to intraday trading. Swing trading has fewer price fluctuations than intraday trading. For swing trading, a medium-term time frame is beneficial, that is, a daily or weekly time frame.

Technical analysis mainly involves the following aspects:

1) Chart analysis:
Candlestick patterns
The engulfing pattern
Bullish engulfing pattern
Bearish engulfing pattern
The marubozu
Bullish marubozu
Bearish marubozu
Doji Candles
Hammer

2) Chart Types:
Some popular chart types are as follows:
Candlestick chart
Line chart
Bar chart
Heikin Ashi chart
Renko chart

3) Indicators:

Some popular indicators are as follows:

RSI (Relative Strength Index)
Moving Average
MACD(Moving Average Convergence Divergence)
Super Trend
Bollinger Bands

4) Price action patterns:
Head and shoulder pattern
Inverse Head and Shoulder Pattern 
Rectangle pattern
Ascending triangle
Descendending triangle
Rising wedge
Falling wedge
Double Top pattern
Double Bottom pattern
Cup with handle pattern
Flag Pattern 
Triangle Pattern 

5) Volume analysis: 

Volume is the number of shares that are traded on a stock or security over a given time period.
Volume analysis plays a very important role in trading. If price is in an uptrend and volume is rising, then we understand that the uptrend is going to continue, but if price is in an uptrend and decreasing in volume, it indicates that a reversal will happen.
On the other hand, if the price is in a downtrend and volume is increasing, then we understand that the downtrend is going to continue, but if the price is in a downtrend and decreasing in volume, it indicates that the downtrend will be ending soon.
A higher high indicates uptrend
Lower lows indicate a downtrend
and when price does not go in any direction, it means sideways

More shares traded at specific times means high volume in that period, and fewer shares traded at specific times means low volume in that period. Volume also indicates that the specific stock or security is active or not.

6) Trend analysis: 

Trend means predicting future price movement based on previous price movement. When the price is making higher highs, that means the price is in an uptrend; on the other hand, if the price is making lower lows, that means the price is in a downtrend.

7) Support and resistance (supply and demand zones):

In the stock market, the price is going into a specific zone and does not continue to further direction and reverse back. That means there are support or resistance levels. Support is the place where the downtrend is going to end and buyers accumulate in high volume; that means demand overcomes supply and price is reversed.

Resistance is the place where the uptrend is going to end, and sellers accumulate in high volume. That means supply overcomes demand, and the price is reversed.

Support and resistance understanding on the previous price movements means previously how many times the price has bounced back.

Above are some basic requirements for trading. 

At first, one should study all the above things and later come to the market.
To help you better understand the terms, we will post a detailed analysis of each of the aforementioned parameters later.
Keep in mind that technical analysis requires a lot of time and effort towards the market. This is not a thing that anybody can understand overnight.