TECHNICAL ANALYSIS AND ITS THEORETICAL BASIS FOR TRADING ACTIVITY MANAGEMENT

Abstract

Research background: In today's era of modern technology, traditional and new methods as well as processes and technologies increasingly contrast. In the first chapter, we focused on a detailed description of the first historical changes in the emergence of trade and financial derivatives. We also identified and described the emergence of specialised trading and stock exchange locations. We continued with a description of the basic methods of analysis and focused on the basics of technical analysis. In the next chapter, we evaluated the current state of research in this area and, based on previous research, we classified and structured individual studies. Purpose of the article: The aim of our contribution is to examine, in detail, the basics and current research in the field of technical analysis. Methods: We consider the inconsistent results of the studies analysed to be very interesting. We consider the unsystematic and inconsistent methodology of the assessment of individual studies to be a major problem. As we mentioned in the article, in many instances the studies analysed focused only on individual aspects of technical analysis and evaluated the final results of the business process. Findings & Value added: In other cases, the results were skewed, mainly due to the nonacceptance of transaction costs or due to risk abstraction. However, despite such results, technical analysis as such can be a valuable tool for predicting price movements. Subsequently, we described our findings, interpreted them, and identified their limitations. We consider the aim of the study to have been met, and believe that it will be beneficial in the field of research on this issue.