These
days many new traders are trading in various markets like stock, commodities
and forex. Majority of them have no in depth knowledge in each market as
fundamentals of every market are different. But new traders specially young
guys who have just finished their college and master or diploma degree in some
specialized courses have jumped in these markets and started trading. They
mostly trade in intraday because it requires less amount of capital only as
margin. You can call it as working capital for trading in these markets. This
is not more than 10% of total trading value of any instrument.
As
most people are aware that intraday trading is not safe as it’s very difficult
to earn money in highly volatile price movements in a single day which can
range from 5% to more than 20%. it’s really very difficult to earn even a 1% in
these volatile markets where there is no guarantee of earning but huge chances
of losing more than what you have put in as small margin for trading.
Given
this kind of conditions how it’s possible for newcomers who has just come out
from their collages and started trading in markets. It’s possible because of
Technical analysis. Technical analysis is a study of price movements of any
security or market index, commodity and forex
Many
traders use Technical charts with different indicators like moving avarage,
RSI, Super Trend, MACD, etc and try to capture price movement in a trending
market and makes huge profits which sometimes are far more than the salary
which they would get after joining their first job. Many middle aged working
professionals have quit their jobs and became full time traders in markets.
They learn this interesting study in few weeks to couple of months and start
trading full time.