let's say that a 30 $ stock with IV of 40 has a 10% odds to be above 35$ in 30 days. If two weeks from now stock is at 36$ , will you continue to hold it ? Or take a profit ( close an entire position , or sell 35 put , etc,etc) ?
either one of them can be used. In my example above ( very similar to his YHOO situation) , both methods would of show almost the same results ( at extreme).
I really don't know. If stock price movement is pure random, its future price depends on the standard deviation, and the current price. So when you know the current price is 36, the probability of going up and going down is close to 50%, independent of the past history. If you use TA, the stock might be overbought, but it can be over-extended for a longer period. The decision depends on how you predict the future movement. That being said, I will book part of the profit.