Technical events occur when recognizable patterns appear in a stock's price chart. Technical analysis of a chart attempts to determine the direction, strength, and duration of the trend in order to forecast the most profitable moment to execute a trade. Trend lines rarely move in completely straight lines. The wavering or zigzagging of a trend line forms various chart patterns. Common patterns have been given names which roughly describe the shapes they make on a chart.
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What is Recognia?
The technical analysis charts on Fidelity.com are provided by Recognia, a recognized third-party leader in the field of chart pattern recognition. Recognia's pattern recognition technology can recognize patterns in price charts.
Note that technical analysis information is provided by Recognia, an independent third party, not by Fidelity. See Important Information Regarding Third-Party Content for more information.
What does the Technical Analysis page show?
For a stock, the Technical Analysis page shows a chronological list of technical events, such as the formation of classic or short-term chart patterns and moving averages. Clicking the event names let you view event descriptions, event details, and Recognia charts that overlay the pattern on a stock price chart.
The Technical Analysis page displays a summary of technical events that can be narrowed to focus on a specific trading horizon:
- Short-Term Outlook
Two to six weeks from now.
- Intermediate-Term Outlook
Six weeks to six months from now.
- Long-Term Outlook
More than six months from now.
Within each time horizon, technical events are listed chronologically and include event name, class, opportunity (bullish or bearish), price at close, and target price range. Click the event name to see further details.
Note: If the name of the technical event is followed by a "W", the event was found for a weekly price chart instead of a daily price chart. The Events table also indicates the price period in which the event was found.
What are the different types of chart patterns?
Patterns are grouped into four classes:
- Classic patterns
A group of patterns that typically have a horizon greater than 12 days and that have distinct price swings which form distinctive patterns. Classic pattern names often reflect the shape of the formation (Double Top, Double Bottom, Head and Shoulders Top, Ascending Triangle, and so on).
- Short-term patterns
Short-term patterns, such as Hanging Man and Gap Up, are based on the shape and relationship of the price bars representing one or multiple consecutive trading days. The technical events confirm that the pattern has formed in the price bars. The events may suggest possible short-term price movement, or support or refute the possible price movement suggested by classic patterns. Short-term patterns are often considered supplementary.
- Indicator patterns
Indicators are based on moving average calculations, which show the average value of a security's price over a period of time. Indicator patterns include Double Moving Average Crossover, Price Crosses Moving Average, and Triple Moving Average Crossover. Moving averages are lagging indicators because they use historical information. They don't get you "in at the bottom and out at the top," but they get you in and out somewhere in between. Indicators work best in trending price patterns where an uptrend or downtrend is firmly in place.
- Oscillator patterns
Oscillator patterns are based on mathematical formulas that incorporate historical or recent prices of a stock, and include KST, MACD, Momentum, and RSI.
How do I view technical event details?
You can view technical event details by clicking the event name in the list of technical events. Technical event details include an overview of the event's pattern, details on the event itself, and an event graph that overlays the pattern on the stock's price chart. You can view from one month to five years of price information in the event graph.
How do I learn more about technical events?
Click the name of the Opportunity Type for complete details on the event's pattern.
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