Technical Analysis for Beginners

Technical analysis studies price and volume data to identify patterns, trends, and potential reversal points. It assumes that all publicly available information is already reflected in the price, and that price patterns tend to repeat over time.

Key Indicators

• RSI (Relative Strength Index) — Momentum oscillator (0-100). Above 70 = overbought, below 30 = oversold.
• MACD — Trend-following momentum. Crossovers signal potential direction changes.
• Moving Averages — SMA and EMA smooth price data. 50/200 SMA crossovers (golden/death cross) are widely watched.
• Volume — Confirms price moves. High volume on breakout = conviction. Low volume = suspect.
• Bollinger Bands — Volatility bands around moving average. Price touching bands suggests potential reversal.

Support & Resistance

Support is a price level where buying pressure historically prevents further decline. Resistance is where selling pressure prevents further advance. These levels are critical for: • Setting stop-loss orders (below support) • Setting profit targets (at resistance) • Identifying breakout/breakdown opportunities iGotFomo calculates dynamic support/resistance levels using pivot points, volume profiles, and historical price clusters.