Learning Center / Analysis

Technical vs. Fundamental Analysis

Understand two complementary ways investors may examine a security: what the business is worth and what market data is showing.

5 min read

01

Technical analysis

Technical analysis focuses primarily on price, volume, momentum, trends, and other market behavior. Common tools include moving averages, support and resistance, volume measures, and relative-strength indicators.

02

Fundamental analysis

Fundamental analysis examines factors such as earnings, revenue, cash flow, competitive position, valuation, and economic conditions to assess a company's business and financial characteristics.

03

Different questions, one process

Fundamental analysis asks what an investment may be worth; technical analysis asks what current market behavior may be communicating. A research process can use either or both, provided the rules and limitations are clear.

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