Seeing something thats not there

Discussion in 'Technical Analysis' started by shark, Mar 28, 2010.

  1. shark


    You TA guys ever feel as though youre trying to see something thats not even there? Drawing various squiggly lines on the chart pretending like you have some idea of whats going on.

    You do realize that there are 200 countries in the world each with their own economies, and every small change in each of these countries ripples through the whole global market. This isnt a matter of pivots and moving averages..Things happen and then the markets react to what's happening.

    You seriously can't expect to have some sort of talent for seeing patterns on charts that no one else sees.. I mean come on there are no secrets or holy grails to this business. It's all clear cut. All that you need to do is close the 15 different charts you have open and check the news. If youre gonna try to make money alone at home, having atleast some connection to the outside world couldnt hurt.

    tldr: TA is trying to see something that's not there. Read the news. Every price move happens for a reason.
  2. On the contrary, the whole TA idea is to see what everybody could see and to estimate the probability that the masses, or at least those who could move the market, would follow through with the TA. It is a self fulfilling prophecy in some respect, but it is what traders do. The news are only the justification that the pundits or the media attaches to price movements.
  3. IMHO only some news events matter. Earnings announcement/pre-announcement. Fed rate change. Etc. Also for "significant" news events you could probably tie them to a price movement. However the reverse is not true, you couldn't necessarily tie all price movements back to a news event.
  4. No.Heat


    Absolutely and right on the money.

    I will make an effort to enhance on the above.

    It's even better when multiple signals agree/occur at the same time, that will get you and other style of traders pulling for in the same direction, this creates momentum and the trade ends in success because the majority of volume is in agreement. The more signals simultaneously triggering the higher the chances of success.

    This obviously does not work all the time as many times there's a strong force, news, fundamentals, strong seller, strong buyer, whatever, that just seems stronger than traders themselves and this is when cutting losses short and reacting correctly means the world in trading.

    There is no magic recipe if there was one it's the one above.