Why technical analysis is less effective intraday

Discussion in 'Technical Analysis' started by crgarcia, Feb 1, 2008.

  1. Large financial institutions take weeks or months to buy or sell stocks due to the vast amounts of money they manage.

    They often buy at random times during the day, and they are avid dip buyers.

    So, you may see pattern to sell intraday (in a short time frame), and wham!, a large buy order.
     
  2. Technicals are effective on any time frame. It is true that they are more effective on larger frames. Thank you for your time.
     
  3. If it weren't random, this would be an easy game, wouldn't it ?
    Why not take advantage of this "dip" phenomenon ?
     
  4. Yup!!!!
    Got to be able to read price to understand this.
     
  5. DerekD

    DerekD

    It's not less effective intraday. It's equally effective. The only catch is that you must create intraday only rules and setups. You should have a system for your specific time frame. A 1 min system will not translate with the same effectiveness to the 5 min timeframe. And vice versa. Nor an hourly to a 5 min or 1min.

    Let alone a daily system to a 1 min system.
     
  6. Lucrum

    Lucrum

    I agree
     
  7. technical analysis is a poor man's excuse for an "edge" lol
     
  8. I like Derek's reply. It works for me.
     
  9. I would have thought that the shorter the time frame, the more reliant the trader would be on TA, since economic fundamentals are not likely to shift from moment to moment, or hour to hour on a typical trading day.
     
  10. Trading on "price" works on all time frames equally well.

    If you're trying to trade off of "moving this" or "derivative that" in a volatile market, you'll be lagging frequently.
     
    #10     Feb 1, 2008