Technical analysis is a method used by forex traders to forecast future price movements based on historical data, mainly focusing on price and volume. This approach involves using various tools, such as charts, indicators, and patterns, to identify trends and potential entry and exit points in the market. Traders analyze price charts over different time frames, looking for patterns like head and shoulders, double tops, and support and resistance levels. Indicators such as Moving Averages, Relative Strength Index (RSI), and Bollinger Bands help traders understand market momentum and volatility. Unlike fundamental analysis, which looks at economic factors, technical analysis relies on the assumption that all market information is reflected in the price, making it a popular tool for short-term trading and identifying market trends.