7 Tools on Tradingview For Technical Analysis  (2024)

Trading Tools are tools used on tradingview which help in predicting the market movement alongside indicators.

Regardless of what type of market analysis a trader uses, there is a set of tools needed to do the job effectively. Traders can not do everything themselves and need certain tools to help carry out particular functions to get them through the day. Not having them could mean failure.

Whether you consider yourself a technical analyst or not, there are very few investing techniques that do not at least give a nod to the technical side of investing.

Some investing styles use nothing but technical analysis, with their practitioners often claiming that they know nothing of stock fundamentals because all they need is the charts.

This segment of investing sprouted from nothing. In this article, we would be exploring the 7 best tools on tradingview for analyzing the market movements

• Horizontal line
• Price Prediction
• Fibonacci
• Gann Box
• Gann Fan
• Horizontal Ray
• Backtesting

Horizontal Line

A horizontal line is a straight line that goes from left to right or right to left. In coordinate geometry, a line is said to be horizontal if two points on the line have the same Y- y-coordinate points. It comes from the term “horizon”.

The horizontal line test is used to determine whether a function is a one-to-one function. According to the horizontal line test, a function is NOT one-to-one if there exists a horizontal line that passes through more than one point of the graph (of the function). In other words, in a one-to-one function, there is only one unique x-value for every y-value.

Price Prediction

Price prediction, also known as a price forecast, is a highly useful drawing tool, especially when used in the context of sharing trade ideas with the rest of the TradingView community.

The forecast allows the users to place an entry and an exit price for a trade. However, it also allows users to define the trade’s duration by extending the forecast line. This tool allows users to place points vertically on two different prices.

A shaded box will then appear between the chosen points showing the range of the prices. Text will also appear along the box displaying the total size of the price moving in terms of actual share price as well as percentage.

Fibonacci

Fibonacci retracement is a method of technical analysis for determining support and resistance levels.

It is named after the Fibonacci sequence of numbers, whose ratios provide price levels to which markets tend to retrace a portion of a move before a trend continues in the original direction.

Fibonacci retracement levels are horizontal lines that indicate the possible locations of support and resistance levels.

Each level is associated with one of the above ratios or percentages. It shows how much of a prior move the price has retraced and the direction of the previous trend is likely to continue.

The Fibonacci retracement tool is one of the must-use tools in day trading. It is used to identify reversal and extension points. While the Fibonacci sequence is a bit difficult, the tool itself is relatively easy to use.

Gann Box

The Gann Box is one such powerful tool that can be used to measure and detect recurring price cycles. The user can set the time and the price range for a cycle that is expected to repeat.

In this sense, the Gann Box is like a road map for the market which can be used to look for targets. Gann box is a trading technique developed by W.D. Gann that is used in predicting support and resistance levels, as well as tops, bottoms, and future price moves.

Studies have been used by active traders for decades, and even though the futures and stock markets have changed considerably, they remain a popular method of analyzing an asset’s direction. Angles are a popular analysis and trading tool that are used to measure key elements such as pattern, price, and time.

The Gann trading strategy is still used and, if applied correctly, can predict the movement of an asset with up to 90% accuracy. W. D.

Gann Fan

Gann fan is a form of technical analysis based on the idea that the market is geometric and cyclical. A Gann fan consists of a series of lines called Gann angles.

These angles are superimposed over a price chart to show potential support and resistance levels. The Gann fan, created by early market technician W.D. Gann, consists of a series of angled lines. The trader selects the starting point, and the lines extend out into the future.

Gann believed the 45-degree angle to be most important, but the Gann fan also draws angles at 82.5, 75, 71.25, 63.75, 26.25, 18.75, 15, and 7.5 degrees.

It originates at a low or high point. The resulting lines show areas of potential future support and resistance. Gann fans can indicate future instances of time and price movements from important highs and lows and thus help identify possible price breakout levels.

Horizontal Ray

The Horizontal Ray drawing tool is similar to the Horizontal Line or Ray except that it only extends in one direction, from left to right.

The user places the origin of the ray at their discretion, and the ray continues from left to right indefinitely.

Use the ray drawing to create a ray in any direction. Create a ray in any direction using the ray drawing. Rays are used on charts to mark the trends in which markets are moving.

A horizontal ray is drawn in a perfectly horizontal position, starting from the point at which you click on the chart. It is possible to set an alert to get notified when a series crosses the horizontal ray on a chart.

Backtesting

Backtesting is the general method for seeing how well a strategy or model would have done ex-post. Backtesting assesses the viability of a trading strategy by discovering how it would play out using historical data.

If backtesting works, traders and analysts may have the confidence to employ it going forward. Backtesting is one of the most important aspects of developing a trading system.

If created and interpreted properly, it can help traders optimize and improve their strategies, find any technical or theoretical flaws, as well as gain confidence in their strategy before applying it to real-world markets.

In conclusion

Many people these days are looking forward to investing in the market movement. For those with little expertise in this sector, keeping a careful eye on the market movements could be a challenging endeavor.

These tools of technical analysis listed above make such financial goals obtainable for them. Share analysis tools may assist them in knowing the pros and cons of the share.

The most successful traders are those who took the opportunity to educate themselves on the process. Most active traders lose money, so it’s important that you understand the complexities of the market, what makes an effective strategy effective, and how to manage risk before getting started.