📊 Technical Analysis
Technical analysis studies price patterns and market dynamics to identify trends, momentum, and volatility. Unlike fundamental analysis (which evaluates a company's intrinsic value), technical analysis focuses purely on historical price and volume data.
📖 What's Inside
📉 Indicators
Chart overlays that extract trend, momentum, volatility, volume, or risk information from market data. LibreFolio implements 22 backend indicators, each explained from both a financial and signal processing perspective:
- 📈 Trend — EMA, SMA, KAMA, ADX, Aroon
- ⚡ Momentum — RSI, MACD, ROC, Stochastic RSI, PPO, CCI
- 🌊 Volatility — Bollinger Bands, ATR, NATR, Donchian Channels
- 📊 Volume — OBV, MFI
- ⚠️ Risk — Underwater Drawdown, Rolling Return, Rolling Volatility, Rolling Sharpe Ratio, Rolling Beta (Asset-only; concepts under Risk Metrics)
🎯 Synthetic Benchmarks
Mathematical reference curves overlaid on charts for comparison. Unlike indicators (computed from market data), benchmarks are generated purely from parameters:
- Linear Growth — Simple interest model
- Compound Growth — Compound interest model
- Sine Wave — Cyclic reference for seasonality
⚡ The "Fast" vs "Slow" Intuition
In finance, fast and slow refer to the time constant (\(\tau\)) of the underlying filter.
| Property | Fast (small \(N\)) | Slow (large \(N\)) |
|---|---|---|
| Cut-off frequency \(f_c\) | Higher | Lower |
| Noise rejection | Poor — lets HF through | Good — strong smoothing |
| Phase lag | Small — reacts quickly | Large — significant delay |
| Typical \(N\) | 9, 12, 14 | 26, 50, 200 |
🔗 Related Sections
- 🏦 Instruments — The assets these indicators analyze
- 📐 Fundamentals — Returns, day count conventions
- 📈 Portfolio Theory — Risk metrics and allocation