Hey. I have been deeply interested in technical analysis for a while, and have spent countless hours trying to find the right combination of indicators to predict the future. However, when you look at it from a legitimate economic standpoint, there is absolutely no reason for technical analysis to work.
The market is absolutely not random, and it operates on a simple basis of cause and effect (e.g. Bad thing happens -> prices go down.) When you forget about all the indicators and just try to understand "why is it that the dow went down today?" you will start to see much more on a chart. I can not begin to comprehend how someone can expect to make a profit without taking into consideration economic and political fluctuations. To add to this point, it is largely impossible to trade solely on price and volume analysis. You will get blindsided too often by unexpected news reports and the like. The markets are not so complex that anyone will need more than two charts open. All technical analysis will ever do is re-illustrate the existing data. If, for example, I take a simple intraday candle chart and convert it to point-and-figure format, nothing changes. No amazing new views will be unlocked, because its the exact same thing. The market simply relies on speculators and investors reacting to the constant changes of the economy.
This brings me to my next point. I have also been trying to figure out how to scalp, with little success. People say that scalping is worthwhile because you are less exposed to large economic movements. This is true. However, the orders coming in the market at such a micro scale can not be predicted. Even in a large downtrend, if you look at a one-minute or less chart, there will be multiple short up moves. I will state again that the market is absolutely not random, but it is almost random at such a short time scale.
Many people, including myself, jump into day trading with hopes of easy profits working from home. it is almost like one of those "work from home" scams on late-night television. Yes, it is completely possible to become very rich trading from home. However, this requires the prospective trader to step away from the magical, colorful charts and look at the market like a seasoned economic professional.
Thanks for your time.
The market is absolutely not random, and it operates on a simple basis of cause and effect (e.g. Bad thing happens -> prices go down.) When you forget about all the indicators and just try to understand "why is it that the dow went down today?" you will start to see much more on a chart. I can not begin to comprehend how someone can expect to make a profit without taking into consideration economic and political fluctuations. To add to this point, it is largely impossible to trade solely on price and volume analysis. You will get blindsided too often by unexpected news reports and the like. The markets are not so complex that anyone will need more than two charts open. All technical analysis will ever do is re-illustrate the existing data. If, for example, I take a simple intraday candle chart and convert it to point-and-figure format, nothing changes. No amazing new views will be unlocked, because its the exact same thing. The market simply relies on speculators and investors reacting to the constant changes of the economy.
This brings me to my next point. I have also been trying to figure out how to scalp, with little success. People say that scalping is worthwhile because you are less exposed to large economic movements. This is true. However, the orders coming in the market at such a micro scale can not be predicted. Even in a large downtrend, if you look at a one-minute or less chart, there will be multiple short up moves. I will state again that the market is absolutely not random, but it is almost random at such a short time scale.
Many people, including myself, jump into day trading with hopes of easy profits working from home. it is almost like one of those "work from home" scams on late-night television. Yes, it is completely possible to become very rich trading from home. However, this requires the prospective trader to step away from the magical, colorful charts and look at the market like a seasoned economic professional.
Thanks for your time.
