Thomas Bulkowski is one of the few out there that maintains "live" statistics of TA patterns in primarily stocks. Yet, don't misunderstand his use of TA. He does not use it alone. He's into fundamental analysis, diversification, money management, position size management and many other things you'll typically see in a profitable trader's trading plan. I highly recommend anyone venturing into TA to get some of his books to help them be better prepared to use technical analysis.
You're very right about it of course. TA alone is not a recipe for success. Patterns are just points to enter and maybe exit (not always), but there are other elements in the successful trading too.
The statistical tests are based on the bootstrap technique (Efron 1979, 1982), a nonparametric method frequently used to evaluate technical trading strategies (Brock et al. 1992; Levich and Thomas 1993). To implement the tests, I compare the behavior of exchange rates upon reaching published support and resistance levels with the behavior upon reaching 10,000 sets of arbitrarily chosen support and resistance levels. If the outcome associated with the actual levels exceeds the average outcome for the arbitrary levels in a high proportion of months, I conclude that the published levels have significant predictive power. http://www.ny.frb.org/research/epr/00v06n2/0007osle.pdf In short this the finding is the ultimate in the surf crushing argument. Not only did the Fed find T/A real.... they found that it was even self fulfilling exactly the point made by t/a people. If enough people look at levels those levels become non random.
Agreed, although someone mentioning they only use TA doesn't necessarily mean they use no money management as has been suggested.
Keep looking under that pillow, surely the tooth fairy is due soon for your neighborhood. Please explain how well compounding works in a game of chance after you increased the bet about 5 fold. At best compounding works when your money is doing a slow death for "PPP" as the dollar sits in a bank or some other interest account. HFT is a myth for small traders just like the tooth fairy and Santa is for children. :eek:
I often use a Trader Vic pattern for price action entries around key areas such as trend lines, channel lines, 20EMA, etc. Because I use a specific pattern in a smaller time frame to trigger my entries, whether my trend lines or channel lines exactly match up with someone else's doesn't matter. A few ticks here or there is noise. It's the big picture that matters.
Besides if your trend, channel lines etc. matched exactly with everyone else than others will take out your stops routinely.
LOL! You better inform Nanex and Eric Hunsader of your opinion. Maybe you could convince their data research team of your ill founded statement. For those who may be misled and haven't a clue what i am talking about: http://www.peakprosperity.com/podcast/79804/nanex-investors-realize-machines-taken-over