The S&P 500 will top at 3250
- Thread starter volente_00
- Start date
Well, not quite that cut and cry. If TA is an after-the-fact, then how can you explain why the price reversed exactly at the trendline as shown below?
Because you are drawing what fits your narrative, after-the-fact.
Cognitive bias type of thing?
Yeah, something like that.
For example, here's a trendline drawn on a large NQ chart...
Draw at a higher-high and higher low...
Looks good so far...
K, looks good for a redraw as it seems to be establishing a new range upwards? Hmm!
Let's wait a bit...
Ouch, nope, trend channel re-established! K, NOW it looks GREAT for a long back into the middle of the channel. Go long with abandon at 9193!
Ooops! So much for that idea. So in looking at your charts, what are your TA indicators telling you to do for tomorrow? Long, short, or stay out? Well, we know the market is going to move, but we do not know which way. Only the news will direct the movement, which will then lead to the market painting it's picture of it in these patterns, after the fact.
The only leading indicator of the markets is being a bedfellow of Powell and Trump, literally. And the thought of that is just disgusting, lol!
So if you are a large speculator with massive size to move do you just flip flop your position every time a new tweet comes out or when new headlines hit the wires? Is this logical?
I would not know, since I am not a large speculator. But as to the flip-flop idea? You betcha, if you are a specerlator!
You would flip flop positions with no concern for liquidity?
Personally I believe that Price behavior tends to precede news because informed speculators position for things in advance. Just a theory.. obviously I have no proof for any of this.
You're simply wrong. Not with today's headline-driven market.
See May 2019 and Aug 2019. I remember watching the charts in early May on his new tariff missive, and in early August when Trump tweeted his Nazi directive that all companies must cease doing business with China. That was messed up, and the markets thought the same thing, and TANKED on those days, HARD. And kept tanking for some weeks.
TA cannot prepare one for that. But reacting to the news is what the algos did, and they did it hard. Look at your chart history for details. They were 10% corrections on the NQ.
This new corona virus looks to be more of a slow burn, and the only thing we have going for us now will be the big earnings, and the Fed decision on Wednesday.
These will not be "technical moves", they will be fundamental ones.