T/A won't make sense to me until I understand this:

[kut2k2]

Quote from lilduckling:

here is how the impact of chart patterns have changed.

strengh of having that edge in:


1920 = .44 magnum

2008 = fishser price water gun


truth is, today it matters very little.... everyone is looking at it in a way like..... say... spy vs spy mentality.

If a chart set up looks picture perfect BUY set-up.... than way too many money movers will be getting ready to sell into it or to short it ..... trying to catch trapped bulls.

but all others also understand this ... and will try to make a move to trap the bears in case they fail..... it goes on and on.

its like a 4 way tug of war.

But the kicker is.... while all the chart pattern heroes are at war,
the real market movers are in another level altogether.... they take advantage of news items that can slap the markets in any dirrection.....before anyone else.

and even if you spent $2000 a month in news feed srvices.... you would still loose.... because for the most part, NONE of us here know how the market will react to news ..... sometimes bad news is good news, good news is bad news. all we can due is wait and see how the market reacts to it... then make our move..... if its economic news, we stay out alltogether... wait.... then buy or sell depending on what our complex multi-computer screens burp out.

point is..... when it comes to news.... we dont have the edge on the big dogs..... news are instant through out the globe.... this is where having a degree makes a diffrence..... knowing how the news will impact the markets.

begining of the century all we had was telephone.... news was not instant..... chart patterns knowledge was akin to being a guru... it made millionares......today not the same..

so we stick to out trendlines, patterns and indicators.... and
hope we can nibble off a few inefficencies ....

i say again:
chart patterns 1920 = hot 19 yr blonde
chart patterns 2008 = 85 yr lady with boobs sagging to her knees

Best TA post of 2008 (so far)!

 

[Bootsie]

Quote from AutoMate:


P.S. the TEMPORAL aspect of trading applies to risk analysis and money management decisions as well. [/B]

Truer words were never spoken...

 

[YoungOne]

The longer the timeframe the more important the pattern or S/R.

 

[4DTrader]

Quote from jonbig04:

What was confusing was in the book I was reading they kept mentioning specific performances of certain patterns e.g. "the head and shoulders pattern appeared 431 times and resulted in 406 reversals. The average length of the pattern is 62 days". The almost always mention the stats in the context of days and months.

jonbig04,



Would you please tell me the name of the book you referred to?


Thanks!

I seldom read books, I bought some books months ago, never finished them. All my trading books don't exceed 10. I am surprised some people have dozens of books.

 

[ammo]

Quote from jonbig04:

I look forward to getting to that point! If you know of any good books in particular please let me know...i know not all books are created equal. The post you quoted me saying though was meant to be satirical. He was implying that we are ALL following the same patterns and trendlines, thus making TA obsolete because everyone is doing it. What I meant was that if that were true then he would see the patterns, KNOW what everyone else is going to do and act accordingly. Not that that would work, but that was kind of my point. Thanks for the advice again.

there is a book "Swing Trading" John D Markham, well written,short and to the point, explains methods of 5 different successful traders and one uses about 7 or 8 chart patterns with trendlines, some chartist somewhere said use trendlines like they were drawn with a crayon,which would support previous comments about waiting for confirmation when your stock touches a trendline

 

[ammo]

trendlines work,in this particular time in history,there is a lot of liquidation going on due to a crime yet be revealed in the hedgefund industry,for those having a hard time seeing the forest thru the trees,the money being moved is akin to the recent spring rain in the midwest,it always rains in the spring,it rains this much only once in every 7-10 yrs causing floods. It's hard to do but if your not comfy in this mrket sit on your hands, if you are in, trade with bigger timeframes because the amount of cash being moved won't stay within the closer trendlines

 

[Mup]

Quote from Landis82
Quite often a market will make an upmove (A) with a counter-move retracement down (B), and then another upmove (C).
This is called an A-B-C.
And quite frequently, one can figure out the price objective of "C" by taking the length of "A" and adding it to the bottom of "B", with "B" usually being some sort of a fib-ratio retracement of "A".
The same thing can be done in reverse, for a declining market.
When C=A that is called an "equal" measured-move. However, sometimes "C" is simply a fib-ratio of "A", such as .618 or .50, or .382
Nonetheless, such a pattern gives you a pretty neat way of identifying the possible price target of "C".

Some Very useful information being given here.