Is technical analysis getting the recognition it deserves in university studies?

[marketsurfer]

Quote from NoWorries:

Here's a study that appeared in the Journal of Finance in 2000
http://web.mit.edu/alo/www/Papers/techanal.html

thanks for that well known paper. i have spoken with its creator at length on several occasions, he is brilliant but this paper is not any kind of proof for TA. however, it is one of the first efforts to quantify TA ( something that cant be done).

it's bandied about by TA enthusiasts as some sort of proof, making it clear that most never even read the synopsis. the conclusions reached are very dubious and uncertain. in addition to data issues, et al

surf

 

[marketsurfer]

Quote from optioncoach:

LOL yeah we got Thinkorswim to donate their platforms so students can have paper accounts to trade stocks, options and futures.

I dont care if TA is testable by academics.

I can certainly put together my own technical analysis approach and backtest it with data as does many technicians with fancy computers and access to data. Of course they are trading to make money, not to put out papers in Journals or prove anything to academics.

Most academics test simply moving average crossovers and basic crap like that. No one I know or have read about trades using one indicator or with such a basic approach. No one who makes money at least.

thats awesome, very very cool gesture by TOS. i no issue with TA being used intuitively as an artform( i look at charts) however, i have never seen a TA system that worked with profitable results over any reasonable amount of time. its soooo subjective rendering it far from a science.

best, surf

 

[El OchoCinco]

Well there are so many TA practitioners making money just like there are Fundies as well. If you are looking at price charts and trading off of price and volume and support and resistance and trend it is TA.

TA working is not the issue since TA is just an indicator or value derived from the prices in the charts. The question is whether a person can use TA to make money and the answer is yes.

I think the problem is that most ask the wrong question.

 

[marketsurfer]

Quote from optioncoach:

Well there are so many TA practitioners making money just like there are Fundies as well. If you are looking at price charts and trading off of price and volume and support and resistance and trend it is TA.

TA working is not the issue since TA is just an indicator or value derived from the prices in the charts. The question is whether a person can use TA to make money and the answer is yes.

I think the problem is that most ask the wrong question.

well, there are far more not making money using it. there are also people making money using astro and random entries--this proves nothing. im not interested in anything without a quantifiable edge and TA has no quantifiable edge. just so you know, im a former member of MTA and have studied TA for years--these are the conclusions i have reached by trial and error and research. its where im at right now in my market evolution.... if i can be shown to be wrong, im open to learn.

do you teach TA at george washington, and if so, what text do you use?

thanks,
surf


ps. perhaps you can answer how many time frames in one direction increases the odds of the next time frame being in the same direction or opposite direction. is this not what TA proports to do at the most basic level??

furthermore --does 10 heads in a row in a coin flip indicate a "heads trend"? if it doesn't, why does 10 levels of increased stock price, indicate an uptrend??

 

[ByLoSellHi]

How can TA be of any use if even its strongest advocates admit that you can't standardize it, and teach people how to utilize it to forecast future events accurately?

What's with the hedging and talk of "well, it's a tool and will differ in utility depending on whose hands it's in"??

In science, something only has merit if it's reliable, repeatable, reproducable, etc.

 

[El OchoCinco]

There is no text for TA and it is not a full semester of TA. Murphy's book is good to learn all the tools but I am not trying to teach people how to use the tools specifically to trade to make money because I have no incentive to teach people the way I make money. the point is to teach them what the tools are and let them work on deciding which combinations or what analysis best matches their trading style and timeframes.

here is an anology. I teach options. I cannot teach how to make money specifically with options. I can teach them all the strategies and different situations where they work best in general but how can I teach them to make money when each of them will have different trading styles, trading time frames, different securities they will specialize in, different risk aversions, etc...

And as far as your P.S. I dont see that is what TA does at all. If you beg for a God to come down and prove to that TA is a science with specific examples of profit making steps you need to follow exactly, then we both know that does not exist.

I chart the trends and price channels and look for breakouts of support and resistance. I am not predicting if it will rise or fall, I play the odds that a breakout of resistance is more likely than not to continue higher and break down through support is more likely to continue lower and trade off of that. Trading is about probabilities.

Where does science fit in and who ever called investing or trading a science?

Thre are 100s of ways to trade using TA and I cannot speak for all of them so I do not know how I can answer your questions realistically. I am just one person. I have no incentive to prove you right or wrong because this is meaningless. All that matters is that yo make money. If you looked for a black box system in TA and nothing worked for you and you do not use price charts at all to trade and make money then why should I ask you to change a thing. I am not here to prove to anyone anything, especially if the person feels they are making money without this tool. If Nomar Garciaparra looks like a freak when he enters the batting box but hits .300, why should anyone tell him he is not using a traditional stance.

Quote from marketsurfer:

well, there are far more not making money using it. there are also people making money using astro and random entries--this proves nothing. im not interested in anything without a quantifiable edge and TA has no quantifiable edge. just so you know, im a former member of MTA and have studied TA for years--these are the conclusions i have reached by trial and error and research. its where im at right now in my market evolution.... if i can be shown to be wrong, im open to learn.

do you teach TA at george washington, and if so, what text do you use?

thanks,
surf


ps. perhaps you can answer how many time frames in one direction increases the odds of the next time frame being in the same direction or opposite direction. is this not what TA proports to do at the most basic level??

 

[dandxg]

Quote from NihabaAshi:

It's been posted before a few times here at ET with a list of universities by students of the university.

Off the top of my head without using ET search menu to find those old discussions...

University of Texas in on the list and its taught as a specific class to undergrads and a graduate level class.

However, I don't know what aspect of Technical Analysis is taught.

After all, it is a fairly big field of study that can involve just about anything from math to subjective stuff.

P.S. May be easier to google it and find PhD students doing their papers on TA especially when the PhD student is teaching a undergrad class on the topic.

Mark

San Francisco State teaches Wykcoff, but I can't find the link.

 

[El OchoCinco]

Calling trading a science is laughable.

TA is just a tool. Just like a long call and a long put is just a strategy. It does nothing but sit there and it is up to the individual to see the tool and decide if he or she can use it or not. There is no science, this is not proving something in the natural world.

If you are looking for someone to hand you something that is reliable, repeatedale and reproducable, I know why you are dissapointed in trading.

I laid out word for word and stirke for strike how I trade SPX credit spreads in my thread with thousands of views. You think I can find more than a handful that traded exactly like I did? I doubt it.

Quote from ByLoSellHi:

How can TA be of any use if even its strongest advocates admit that you can't standardize it, and teach people how to utilize it to forecast future events accurately?

What's with the hedging and talk of "well, it's a tool and will differ in utility depending on whose hands it's in"??

In science, something only has merit if it's reliable, repeatable, reproducable, etc.

 

[marketsurfer]

Quote from optioncoach:



I chart the trends and price channels and look for breakouts of support and resistance. I am not predicting if it will rise or fall, I play the odds that a breakout of resistance is more likely than not to continue higher and break down through support is more likely to continue lower and trade off of that. Trading is about probabilities.



.

thank you for your kind response. however, if TA does in fact, increase the odds--this could be easily shown using basic statistical tests-- when such tests are applied the results are not any better than random.

i stand by my conclusion that TA is intuitive and an artform that is very far from science.

surf

 

[El OchoCinco]

Nice conclusion, but who in their right mind calls it a science???

I never heard of anything related to trading equated with science.

And just because you call it an artform does not mean people use it to make money. that is all that really matters in the end though isn't it? That is academic papers are pretty much useless. Whether they are looking to prove or disprove something in trading they are all flawed for the most part.