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Technical analysis for trading

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Newbie
Aug 23, 2012
97 posts

Technical analysis for trading

Who uses the so called 'technical analysis' for deciding what to trade or invest?

Such as 'resistance' or 'pivot' points etc?

Is it useful and do you use it for your own investment decisions?

Ive heard some traders go through their analysis drawing on the charts etc. Personally I think its kinda pseudo-science BS snakesoil artist speak. Maybe it works from tiem to time as it it turns out somewhere like where you expect it to. But in no way is it 'science' or anything. There is no basis to it.
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Feb 25, 2012
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SCARBOROUGH
SCEES8 wrote: Who uses the so called 'technical analysis' for deciding what to trade or invest?

Such as 'resistance' or 'pivot' points etc?

Is it useful and do you use it for your own investment decisions?

Ive heard some traders go through their analysis drawing on the charts etc. Personally I think its kinda pseudo-science BS snakesoil artist speak. Maybe it works from tiem to time as it it turns out somewhere like where you expect it to. But in no way is it 'science' or anything. There is no basis to it.
There is *some* merit to TA. We employ TA as part of our research however we keep it simple. We use 50/200 Day EMAs, OBV and MACD.

When used in part with actual fundamental analysis, it helps.

Don't be fooled by the "seasonal" and "ta" guys on BNN who use their time on Market Call to do finger painting and doodling on the screen. They are the real snake oil sales men. Its not that simple!
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Jun 15, 2009
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AntonyLingo wrote: There is *some* merit to TA. We employ TA as part of our research however we keep it simple. We use 50/200 Day EMAs, OBV and MACD.

When used in part with actual fundamental analysis, it helps.

Don't be fooled by the "seasonal" and "ta" guys on BNN who use their time on Market Call to do finger painting and doodling on the screen. They are the real snake oil sales men. Its not that simple!
Logical inconsistency. Spoken like a true broker. It either makes sense/works or it doesn't.
Member
May 2, 2012
291 posts
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Ottawa
SCEES8 wrote: Who uses the so called 'technical analysis' for deciding what to trade or invest?

Such as 'resistance' or 'pivot' points etc?

Is it useful and do you use it for your own investment decisions?

Ive heard some traders go through their analysis drawing on the charts etc. Personally I think its kinda pseudo-science BS snakesoil artist speak. Maybe it works from tiem to time as it it turns out somewhere like where you expect it to. But in no way is it 'science' or anything. There is no basis to it.
If you haven't already, read the book "A Random Walk Down Wall Street" by Burton Malkiel for a critique of both technical and fundamental analysis.
Deal Guru
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Jun 26, 2005
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All big institutions trade the market using TA. Not exactly the way TA is taught in the books or articles you read. It isn't about resistance or support. That's just what they want the general public to learn and follow. That doesn't give you the edge, it gives THEM the edge because they know most people that read these books will do that when price comes to it.

So to consistently gain net profits in the stock market, one has to follow what the big money is doing. Not to beat them, you need to join them.

Fundamentals has a few inherent flaws: the health of a company tells you where prices of their stock should be, but only if big money also believes it and trades like it. Just because you think your used Lexus is worth $30,000, you put it on the market, the highest bid you get is $10,000. If you accept that, then your Lexus value (stock price) is now $10,000.

Also, fundamental doesn't tell you WHEN and what price to get into a stock. Nor does it tell you what price to set your stop loss to admit you were wrong. That's why, people buy a stock and don't have a stop loss. Price goes down, they hold it, and hope it goes back to breakeven. What if it continues down and you are losing: $10, 50, 100, 500, 1000, 5000? Still hold it? So you are taking on unlimited risk for limited gain. If people had stop losses automatically set, no one would be crying over Nortel, or even Apple ($700 to 500 now)

News of the company pushes it up or down. Sometimes earnings are bad, but the stock goes UP. Vice versa. So how can one trade and invest properly with strange volatility like this?

Technical Analysis on the other hand ignores news and looks at price levels where big institutions buy/sell. We follow. TA loves volatility. Profits from it. TA gives you the exact PRICE to buy/short in, and a stop level price. TA limits your risk while unlimits your gains. You set, I will get out if price drops below $x.xx No iffs, ands or buts.... Only then can you keep track of your trades, your method and adjust what works and what doesn't. Discipline.

So, learn TA properly and your eyes will be opened to a brand new world. After I learned it, looking back using TA. I can tell you exactly why the 2008 crash happened and exactly when the bottom of the crash was going to be. Wish I knew TA at that time.

Talk is cheap, here's my tracking of stock picks I posted here on RFD and their results using TA I learned from Online Trading Academy (see my signature for details).
All picks were done before price came in, and executed at where I stated the zone was. Price could have gone my way or not, I cannot control the market. 12 stock picks, 11 winners, 1 loser. Consistency, risk management. If you think is this luck, you give it a try. I have yet to see anyone else here on RFD do the same tracking and show their results.

http://forums.redflagdeals.com/tracking ... d-1228103/
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Jun 26, 2005
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AntonyLingo wrote: There is *some* merit to TA. We employ TA as part of our research however we keep it simple. We use 50/200 Day EMAs, OBV and MACD.

When used in part with actual fundamental analysis, it helps.

Don't be fooled by the "seasonal" and "ta" guys on BNN who use their time on Market Call to do finger painting and doodling on the screen. They are the real snake oil sales men. Its not that simple!
I now watch BNN now to listen to the "experts" so I know what not to do. The only real person on BNN so far is Larry Berman. His words are pretty honest. The rest are mostly wrong.

And to use a line chart to talk about TA is missing so much info. You need to look at Candlesticks.
Deal Addict
Aug 28, 2010
3521 posts
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Halifax
rfdrfd wrote: Talk is cheap, here's my tracking of stock picks I posted here on RFD and their results using TA I learned from Online Trading Academy (see my signature for details).
All picks were done before price came in, and executed at where I stated the zone was. Price could have gone my way or not, I cannot control the market. 12 stock picks, 11 winners, 1 loser. Consistency, risk management. If you think is this luck, you give it a try. I have yet to see anyone else here on RFD do the same tracking and show their results.

http://forums.redflagdeals.com/tracking ... d-1228103/
Could you please stop with the delusions?

That thread is four months old. Do you expect us to believe you only analyzed 12 stocks in the past four months?


When your fortune telling works, you decide to post it to that thread. When it doesn't, you don't. You decided to post one example where it didn't work to try to get more credibility.


All you are doing is shilling to try to get people to sign up for a $5000 course. Because you get compensated for referrals to the course. I'm not sure why you haven't been banned yet.


ps: Roughly two months ago you announced that the market was going to crash soon. Any updates on that?
Member
Feb 20, 2011
460 posts
92 upvotes
FunSave22 wrote: Could you please stop with the delusions?

That thread is four months old. Do you expect us to believe you only analyzed 12 stocks in the past four months?


When your fortune telling works, you decide to post it to that thread. When it doesn't, you don't. You decided to post one example where it didn't work to try to get more credibility.


All you are doing is shilling to try to get people to sign up for a $5000 course. Because you get compensated for referrals to the course. I'm not sure why you haven't been banned yet.


ps: Roughly two months ago you announced that the market was going to crash soon. Any updates on that?
+1. That list is nothing but a pile of BS. Of his 12 picks, one he never entered, one didn't work and 4 came out with less than 3% profits. I could randomly choose a handful of stocks and flip a coin to decide to short or long over a few days and end up with those results. That's nothing but noise. That's 6 picks right off the bat that mean absolutely nothing. There is no link or proof of his DELL trade so let's not take that in to consideration either. His NFLX trade had an orignal target of $99 or $100. It is not until 3 days after the fact that he says the entry was $90. The fact that he even includes it in his 'analysis' just goes to show how full of BS he is. Same with the AAPL trade. He said in the thread it was a short then weeks after the fact added it to his stock picks, choosing a convenient entry for himself. He never took a position in it. That eliminates all but 3 trades from that list but these are only what he chooses to show. Why doesn't he include his prediction where he tells us to sell everything and short the market because it's going to crash. His argument was so compelling too. The lines he drew on the chart were enough to make me believe him
Deal Addict
Jul 20, 2005
1293 posts
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I was curious about TA after reading an article about candlestick analysis (fancy way saying you look at the open/close/high/low prices of stocks). I took a pattern that was claimed to be a very strong indicator of profits. This is something like a downward trend, followed by a "doji" with higher than average volume, followed by a gap up. Forget the exact details. I wrote a program to look for this pattern on all SP1500 stocks in the past 10 years. What I found was that after this pattern, the price would increase no more than 50% of the time. The other times it would continue the downward trend.

Personally I think most of TA is a way to explain what already happened. It would be insane to use it by itself for trading.
Deal Guru
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Jun 26, 2005
10111 posts
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Wow, you are so close minded. Ask any real trading person that is successful and ask them what big institutions are using. Fundamentals or technical.

The point isn't about 12 stocks in 4 months. AAPL and NFLX is still on going btw. The point is I am able to use TA that I learned and able to pick 12 trades and the result is there. Try that with fundamentals and post it. Go ahead. Of course I am continously trading, you think I have time to come here and post it for all you people ?? Get read.

Read the website, I do NOT get compensated for an referrals. The only thing I get if someone joins from a referral is a discount on the next course I take, which again costs $5000. I do not need any referrals because I am not taking any more courses for a long time, plus I have already tons of referred people. I never even asked people to PM me for referrals at all. I have seen a good thing and sharing it, that's all.

I never said markets will drop, I stated what my teacher said. The proper way of looking at it is WHEN the market drops, it has a probability of dropping to those levels.

There you are, I've answered everything you said, you got any other useless accusations? Instead of just bitching about other people's comments, how about coming up with some useful things on your own?

Show us some of your trades, post it live here, see how you do.

FunSave22 wrote: Could you please stop with the delusions?

That thread is four months old. Do you expect us to believe you only analyzed 12 stocks in the past four months?


When your fortune telling works, you decide to post it to that thread. When it doesn't, you don't. You decided to post one example where it didn't work to try to get more credibility.


All you are doing is shilling to try to get people to sign up for a $5000 course. Because you get compensated for referrals to the course. I'm not sure why you haven't been banned yet.


ps: Roughly two months ago you announced that the market was going to crash soon. Any updates on that?
Deal Guru
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Jun 26, 2005
10111 posts
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Toronto
monomono wrote: I was curious about TA after reading an article about candlestick analysis (fancy way saying you look at the open/close/high/low prices of stocks). I took a pattern that was claimed to be a very strong indicator of profits. This is something like a downward trend, followed by a "doji" with higher than average volume, followed by a gap up. Forget the exact details. I wrote a program to look for this pattern on all SP1500 stocks in the past 10 years. What I found was that after this pattern, the price would increase no more than 50% of the time. The other times it would continue the downward trend.

Personally I think most of TA is a way to explain what already happened. It would be insane to use it by itself for trading.
Patterns are not strong TA at all. Demand and supply is. There's probablility of patterns' sucess as well. Google it.

If I showed you the methods I learned on using TA, you will totally be amazed. It can most definitely show what is high probability of happening next. Where prices are going to turn up or down, and you plan a low risk, high probability, high reward trade using it.

You could predict with a high degree of probability the drop from 2000, the bottom of that drop, the drop from 2008 and its bottom. I just wish I learned it back then, I only took the course after 2008.
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Jun 26, 2005
10111 posts
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All talk talk talk. Show us what you can do.

red_skittles wrote: +1. That list is nothing but a pile of BS. Of his 12 picks, one he never entered, one didn't work and 4 came out with less than 3% profits. I could randomly choose a handful of stocks and flip a coin to decide to short or long over a few days and end up with those results. That's nothing but noise. That's 6 picks right off the bat that mean absolutely nothing. There is no link or proof of his DELL trade so let's not take that in to consideration either. His NFLX trade had an orignal target of $99 or $100. It is not until 3 days after the fact that he says the entry was $90. The fact that he even includes it in his 'analysis' just goes to show how full of BS he is. Same with the AAPL trade. He said in the thread it was a short then weeks after the fact added it to his stock picks, choosing a convenient entry for himself. He never took a position in it. That eliminates all but 3 trades from that list but these are only what he chooses to show. Why doesn't he include his prediction where he tells us to sell everything and short the market because it's going to crash. His argument was so compelling too. The lines he drew on the chart were enough to make me believe him
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Jun 26, 2005
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This is the exactly reason why the general public is still losing money to the big institutions. Because people still do not believe in things are not traded fundamentally. They look at earnings, blah blah blah and think, this is where price SHOULD be, so it MUST go there. Very wrong. I have an entire thread proving this, just look at it.

Very recent examples, Explain this:

Why did Apple drop from 700 ? Did bad earnings came out on that day? No, what was SOOO fundamentally wrong that justifies a $200 drop from that exact date?
Why did RIM bottom out from that low at that time? THey didn't come out with BB10 yet, no news came out on that day. Why? Answer: Look at the RIMM chart, weekly in the past. It was a strong demand zone.
Deal Addict
Jul 20, 2005
1293 posts
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Well, I guess if you can correctly predict something in the future, people will start taking you more seriously.
Member
Feb 20, 2011
460 posts
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rfdrfd wrote: All talk talk talk. Show us what you can do.
Maybe you should use some of your profits and take a "Using the Internet 101" class. On the first day of class they teach you that anyone that constantly brags on an online forum is LIAR!
Deal Addict
Nov 26, 2005
3214 posts
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Vancouver
cjottawa wrote: If you haven't already, read the book "A Random Walk Down Wall Street" by Burton Malkiel for a critique of both technical and fundamental analysis.
stop promoting that book. real world market is never efficient. all its argument are based in an ideal world which will never happen.
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Jun 26, 2005
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There you go, look at AAPL TA clearly showed one what was going to happen, Same with NFLX
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Dec 11, 2005
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ccyk wrote: stop promoting that book. real world market is never efficient. all its argument are based in an ideal world which will never happen.
???

Random walk down wall street is an excellent book, and everyone should read it, or at least learn the things it is teaching elsewhere.
rfdrfd wrote: There you go, look at AAPL TA clearly showed one what was going to happen, Same with NFLX
I knew this was going to happen with NFLX a year ago, had nothing to do with TA. Look up my old posts.

NFLX is the future of video. Anyone betting against them is an idiot. It's like people betting against Amazon. Yes Amazon is overpriced but anyone who is shorting them or playing against them has rocks in their head. I made 20% on Amazon this year actually, even though I knew it was overpriced. I could actually see Amazon buying Netflix at some point in the near future... they would actually be perfect partners. Netflix would fill out Amazon's prime catalogue and Amazon would fill out the subscriber base even more.

Contrary to your nonsense, NFLX is the perfect example of why FUNDAMENTALS MATTER.
To be nobody but yourself - in a world which is doing its best, night and day, to make you everybody else - means to fight the hardest battle which any human being can fight; and never stop fighting. -- E. E. Cummings
Deal Addict
Jul 20, 2005
1293 posts
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rfdrfd wrote: There you go, look at AAPL TA clearly showed one what was going to happen
So why didn't you say so BEFORE it happened? I'm waiting for an accurate tradeable prediction.

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