tæknigreiningu

Tæknigreiningu, often translated as technical analysis, is a method of evaluating securities by analyzing statistics generated by market activity, such as past prices and volume. Technical analysts believe that historical price and volume data can help predict future price movements. They use charts and various statistical indicators to identify patterns and trends, assuming that market psychology and historical trends tend to repeat themselves.

This approach is contrasted with fundamental analysis, which focuses on a company's financial health and economic conditions. Technical analysts do not typically consider the intrinsic value of a security or the underlying economic factors affecting it. Instead, they rely on the idea that all relevant information is already reflected in the security's price.

Common tools used in tæknigreiningu include price charts, moving averages, support and resistance levels, trend lines, and various oscillators like the Relative Strength Index (RSI) or MACD (Moving Average Convergence Divergence). These tools are employed to identify potential buying and selling opportunities. The belief is that by understanding market sentiment as expressed through price action, traders can make more informed decisions about when to enter or exit a trade. While widely used, its effectiveness is a subject of ongoing debate among financial professionals.