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Fractal analysis

Fractal analysis is the last word in currency and stock markets analysis. The founder of fractal analysis is Benoit Mandelbrot.  Edgar Peters also made contribution to the development of fractal theory of the market.

Fractal analysis implies that future prices are based on their past changes. It facilitates the forecasting of prices’ falls or rises, although this type of analysis is hard to understand per se.

According to fractal analysis, today’s price has no relation with its all past readings. No long-term or short-term chart can give us an accurate prediction of a price dynamic at this or that moment of the time. Thus, it turns out that the market is almost impossible to predict.

The data received with the help of fractal analysis is based on the wavy lines, which is quite reasonable since there is no specific market scenarios and falls and rises in quotes are inevitable.

What is worth attention?

First of all, pay attention to the factors that form the price at a specific period of time. In case the observations made in political, economic and social spheres match, it is possible to say that the price will repeat its move made some time ago. However, the fractal analysis requires sound analytical confirmation with an access to the latest reliable information on economic and market conditions.

As a result, despite the time and money spent, your benefit is big as you are always one step ahead of the traders who are waiting for the real market move.

How to use fractal analysis?

First, you need to learn how to create small models based on a particular currency, commodity or stock.

After that, you need to simulate a real market situation and find out whether the expectations were met. Otherwise, you need to decipher and analyze the moments that have not been considered.

Once you are able to predict the future price moves, it can be safely assumed that forecasting dynamic is positive. Thus, you could have earned if you had taken this decision in live trading. Hence, you can start using this strategy on live account.

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