What do you mean it's 'bullish' what does this mean? Give us a technical definition.
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I was out getting dinner, lol. So I missed the ignorants arguing the negative. If you don't know anything about something, sometimes it's better not to just rubbish it and make yourself look foolish, before deeply exploring it, using, testing it and decide then whether it has any value.
If it piques your interest as to why every single fund manager, forex trader, futures and options trader, commodities trader etc etc uses TA, as well as FA, then you might want to explore why and what it actually is that they do,
Ok, I'm not here to justify TA, or defend it, I don't care whether you use it or not. As far as I'm concerned genuine TA, actual analysis of the price, trends and patterns is just one useful tool amongst others, like FA etc. It is just another tool in the toolkit for managing my equities, particularly timing buys and sometimes sells.
If I was to simplify it, FA informs me of whether the company is a sound investment. TA informs me of the market sentiment towards the price of that equity, whether it's under or over priced, which in turn informs timing for buying or selling. After all, we are forced to buy or sell in the market, the chart is a visual representation of the whole of market sentiment towards pricing that equity. It is insightful and helpful as to what the market thinks about the equity, ergo the price, its price trend, when that trend changes, etc.
TA, actual price analysis, is helpful imo, giving insights into market sentiment over differing timescales, and whether now is a good time to buy or sell. It does not forecast the future, it is not causal, it does inform probabilities of future market sentiment.
To OCA, TA has been very useful, as surprisingly for a boring RV, OCA is a volatile equity in the market with massive price swings over the past few years. The market price only very rarely actually reflects the 'value', as it over shoots up above, and down below. Volatile equity prices are perfect for TA, it indicates market price sentiment on the low side, the high side, when that is changing, and informs long term investing purchase or sales decisions, and in particular momentum trading.
If you don't want to put the time and effort into even exploring TA, let alone testing and using it, then your opinions about it are worth nothing as you are ignorant and uninformed. If however you did what Sailrob says about company FA, deeply study TA, learn how to use it, backtest proven strategies on your equities, and develop your own strategies, apply them, and then decide whether it was a useful tool, or not, then you would be qualified to pass learned opinion.
Instead of bagging some dude who simply pointed out a weekly MA crossover to the upside.
Does this person believe, as he isn't a fool, that any stock that does this 10 crossing the 20, will more likely go up than down?
And that anyone that does not believe this is a 'fool'
Has this person then considered all they need to do is look for stocks meeting this requirement and buy them, even with a tiny edge of 51/49 this would make them extremely rich very quickly?
But no, they are not...
They instead seem to have an uncanny ability to lose money instead of using their technique that gives them a slight advantage...
I have done, spent many years studying them and read 45 fund letters a quarter.
Almost all get destroyed by a simple index fund.
The ones I follow who have a 15 year plus record of beating the market have never mentioned TA once.
If what you say is true, how can you think a human can do it better than a computer.
Cant say it better than this;
'Ask yourself the question, even if there were small market inefficiencies where paying attention to moving averages gave you an advantage who do you think would win? Large firms with millions of dollars worth of research and development into algorithms which has been trained to find any trend and place thousands of orders before you can blink, or you on your computer (some have even claimed to day trade on their phone on Sharetrader). Any firm competing with you would definitely be able to place their buy/sell order way quicker than you could thus removing any competitive advantage you could theoretically have'.
I don't want to put in the time or effort into exploring dancing naked around a fire to heal my sick friend either, this does not mean my opinions about it are worth nothing or that I'm ignorant as I'm using other principles to determine that I'm not interested, don't need to try myself to know someone is full of S*&^
'it does inform probabilities
Ok, so then it provides some kind of statistical edge in making a purchase or sale?? Can we agree that's what you're saying?
Go on, say it. I'm getting the cannon of destruction ready.
I would have thought a computer could go back over a 100 years of hundreds of thousands of charts and easily determine if any patterns had a statistically significant meaning as the the probability of what happened next?
Afterall wall street spends billions of this type of stuff, analysing looking, for anything at all that could give a slight edge.
So surely that data is out there??
'Hey a stock doing this criss cross of Gunners has shown historically that then the chances of up next are better than 50/50... We have the data to prove it'...
We don't need to experiment ourselves, the data is there, the price history is there...
So, show me?
SailorRob,
You are not qualified to have a discussion on the value of technical analysis, you don't know anything about it and keep reverting to funds underperformance and algo's beating the average Joe. It's irrelevant, it's just your perception. Your bagging of TA and anyone who mentions it is, not helpful. You too ValueNZ.
FA is excellent for identifying investments and monitoring their performance. No one I know doubts that, but surprisingly few have the analytical financial skills to do it.
TA is useful for determining whether now is a good to do buy or sell, in the market, it is the market price sentiment that you are forced to buy within, or sell within. It can be down to the minute, 5 minutes, 15 minutes, an hour, a day, a week, a month, quarter, or year. It is just timing, and just probability. Algo's are irrelevant, a buy signal or sell signal could be day, week, months or even years apart. It's about following the money, up or down. It's about the market price and insight into it. It has nothing to do with the value of the company.
TA has been particularly useful for OCA buys and sells over the past few years, it is a very volitile priced equity (surprisingly).
Anyway, I think that's enough from me, you can have the last word on this. 30 years of people bagging TA and then funnily enough coming around to realising it has some value that compliments their decision making.
Well said. To be fair I used to be in the ta is a load of bs camp. It is easy to dismiss because its includes alot of nonsense
You can tell sa doesnt know much about it because he mentions algos as if ta is always day trading. It may be but may not be. Fa with a light touch of ta is the way to go.
Oca clearly has trends. Jan 2020 to current day shows this on the weekly.