Quote from Paulds11: Another ramble by someone who believes in TA and continues the fairy tale with typical anecdotes, opinions and assertions: The purpose of Technical analysis is as an aid to where the money is flowing. Contrary to your opinion it does indeed matter that many use it because a Trader is always trying to move WITH the HEARD not against it, as such whether we like it or not we must therefore concern ourselves at least in part to what people are doing.. is that simple as a point of principle. On the contrary, this is all opinion. Mechanical systems work (not many traders are effective but they work, and many Investment banks use Algorithmic trading in many guises but they are in basic form Technical Analysis based trading systems, Provide proof, not assertion & opinion. Also I never said anything about technical analysis itself doing any predicting, rather it described what happened and what IS... Prediction is an extrapolation of what was and IS by the Trader NOT necessarily Technical Analysis. Correct. TA does not predict. No one method works easily, even Technical Analysis is a difficult discipline to interpret and understand, my point is that you seem to dismiss it as even being popular or in use by a large number of even Retail traders and investors. I had my initiation to Technical Trading From two huge names, Chuck Mellon and AJ Monte and they introduced me to Technical Analysis as a Momentum Trader and they are worth money and yet you continue to deny this?.. man no more of this nonsense...PLEASE.. your replies are just hot air..look how many posts you've made ... its a wonder you have any time to trade... If you Trade at all that is.... "Two huge names...worth more money"...your assertion is a poster child for anecdotal evidence -- Definition: Anecdotal evidence is an informal account of evidence in the form of an anecdote or hearsay. The term is often used in contrast to scientific evidence, such as evidence-based medicine, which are types of formal accounts. Some anecdotal evidence does not qualify as scientific evidence because its nature prevents it from being investigated using the scientific method. Misuse of anecdotal evidence is a logical fallacy and is sometimes informally referred to as the "person who" fallacy ("I know a person who..."; "I know of a case where..." etc.)." Technical Analysis will provide me an edge in that it is of course impossible to predict accurately, but if you deny that the ARMS index, MACD, RSI, CCI, WADX, DMI, Lines of support and Resistance, TIKI TRINQ, 50 and 200 day moving average somehow are irrelevant as an aid to understand market sentiment currently so I can then make my own market perditions then you are a fool.. pure and simple... Without proof, your strong claims of its value do nothing to strenghten your arguments. I assert once more... This is usually all TA lovers can do. It was like in a "Few Good Men" where the young naval lawyer says "I Strenuously Object!!" Im all done here folks... its a shame really the argument needs to move on to which T.A techniques are better suited to particular time frames..e.g. MACD is a lagging indicator not a lading one and which timeframes do Traders find it suitable / unsuitable..etc etc... this is where we should be by now... Throwing up beliefs and baloney and saying that should basically be enough only makes you look like a duffer. Belief, opinion and arguments is no more proof of its value than the anecdotal evidence malarkey you threw up earlier As such I wont answer more replies on this issue untill we can move this one along a bit... Yes. If you say so, it must be correct. Yuck sorry but, we both know this is right mate.. Because you think so or because you convinced yourself you have proven your case?
You're wrong. The public uses "Fundamental Analysis". Most of the public are not here on ET trying to trade intra day or invest short term. As far as whether TA works or not, who cares? I'd rather have people believe it doesn't work.
uhhg... fundamentals try to asign a certian value to a security. technicals just focus on market emotion and price. both methods are completely subjective, because even with fundamentals, you're making an arbitrary guess on what you think the market will do. So, neither of them can be scientifically proven better in any random instance. Proponents of either side, when attacking the inadequacies of the opposite analysis technique, usually base their perverted criticism on huge generalizations. Investing and analysis is a personal thing; pick the one that makes the most sense to you and works the best for you and be done with it. And anyone who says 'reading charts is like throwing darts' is a moron. There's guesswork in every strategy that has ever been concieved.
interesting belief, but wrong. when was the last time you saw a fundamental computer program? almost everyone has a PC and almost everyone uses TA who trades. TA is huge industry ( relatively) to any other kind of analysis. why? cause it looks easy-- please note---not defending fundamental analysis here peace surf
Really the job of those who want to act in the markets is to find a productive way to characterize the markets. I happen to know people who are productive using all kinds of analysis, including Traditional Technical analysis, and Traditional Fundamental analysis. What I notice about both groups, is that they have in common an ability to use traditional analysis as a jumping off point, and they have added to it, or learned to use it in a slightly different way. I have done the same thing myself with significant result. In my own case I took a concept (Linear Regression Channel) and learned to adapt it to my own needs. I asked myself, how can I use the statistical basis for a distribution but get a different visual look to my display. Also I tried to solve the problem of working with a distribution that is constantly changing. For that I took an approach similar to the one used by proponents of "Market Profile" (trademarked). Once I worked through those problems, I found that I had one more issue to resolve and that was "how to bet" properly, so that my capital was protected yet my exposure was significant whenever the market was moving my way. I was able to do this using technical analysis, and simple logic. I think it helped that I have a lot of experience and the right education. Those of you who don't mind having to do some work, having to think critically about problems, and then testing your result, will (I hope) get the message. Debating whether an approach like Technical analysis "works" is similar to debating whether a screwdriver "works"....Anybody with a brain in their head can see that what matters is whose hand the screwdriver is in (and what they are trying to do with it). I think the same is true of technical (and fundamental) analysis. Good luck Steve
Surf, I posted that a while back (another one somewhere on ET that shows projections of 23k being reached based on divergence readings). What is today's valuation of Hang Seng? Of course in your opinion this is totally coincidental, to me, as I trade these divergences all the time on short term charts it is not a coincidence but a calculated projection.
You guys still debating about the value of TA??? It's very simple. If you are profitable and you use TA... It obviously has value. In contrast, if you are not profitable while using TA... It obviously has no value. The determining factors of TA's value... Profits or Losses. Surely a TA basher doesn't expect a profitable trader using TA to stop using TA. Just the same, surely a TA advocate doesn't expect to convince someone that couldn't make money via TA to give it a try again. In addition, some prefer backtest stats as proof while others prefer real trading stats as proof. With that said and as a reminder, you need more than TA to be a consistent profitable trader and that alone makes this entire debate kind'uv silly. Thus, it's not all about entry signals and the more you understand that... You'll have a better understanding of why there are traders that failed at using TA and why there are traders that don't fail at using TA. Look at your brokerage statement at the end of each year with your personal journal of each trading day to keep the debate about TA in perspective. * IF you are profitable, don't be fooled into thinking it was only via TA (hyping). * IF you are not profitable, don't be fooled into thinking it was due to TA (scapegoat). Good trading to all regardless to what type of method you use. Mark
Well said NihabaAshi, dont get too hyped up though.. I notice the same names in almost every thread on ET stiring up nonsense. Rcanfel and Market surfer continue to challenge views for the sake of it... not neccesarily because they believe it wholeheartedly. In addition read the quality of thier replies..very poor and yet they will attack without revealing precisely how they trade, what they trade profitably or what timeframe they even trade on.. Yuk, even Rcanfel is now trying to make me justify the credibility of MACD and trendlines by quoting me "the scientific" method?.. lol.... to me.. a Biochemist with an MBA.. what a joke its hilarious... dont waste your time folks..... move along, theres nothing to see here
sorry, i tend to prefer consulting quant finance PhD's and statisticians when it comes to the market. if i need to create a powerpoint presentation on a drug company, i'll contact you. judging from your posts, you have a long way to go in your market education. i once was a TA true believer, so there is hope. Once again, when TA is tested objectively it fails--- test after test after test. why?? Some ta cult members will tell you the tests are flawed..... what a joke! surf