What information does Technical analysis tell you ?

Let's differentiate TA that lags from TA that is predictive.

TA lags the price action normally however if you learn to project the indicators where they are fixed in values and don't move with every new tick, now your on to something.

You would be taking the best of math and converting it to price action application. Just as trend lines, support resistance numbers and numerous static number assistant trading tools.
 
taowave said:
Please point me in the direction of your Situational Analysis thread..
Sounds like a different take on Wyckoff..

FYI,before retiring,I worked at what is now a 38 billion dollar fund...

I was very familiar with the multi strategies employed and the various methodolgies/profitabilty..

You speak in absolute terms,and there were very few absolutes in trading...

Burry said it best..Theres a way to win at everything.It just has to be found
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https://www.elitetrader.com/et/threads/are-we-going-to-run-out-of-shares.298936/
https://www.elitetrader.com/et/threads/trading-is-easy.321831/

didn't mean to sound absolute at all... after all I am just an amateur investor/trader, nowhere near the sophistication of the pros..
 
dozu888 said:
darn OP if you posted this a few months earlier I could have given a better answer..

due to my other businesses I know UL well and actually bot a bunch before KHC wanted to buy... of course I was happy with the lucky windfall profit, but in the following months while KHC quickly faded from the initial pop and went into free fall, UL was jacked up there as if the merger wasn't dead.... I think I sold it at the top tick, but I don't remember some other details related to the story as it was many months ago.

forget TA... in trading you just need to unfold stories, it's more like situational analysis.... of course you need to see the price... but drawing lines and shit is just waste of time.
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Lol I drew some lines yesterday. It wasn’t a waste of time.
 
dozu888 said:
support/resistance is a myth.
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%%
Well that depends do888.
Bull markets [yes] have no resistance; bear markets have NO support."Waste of time'' pretending there is resistance in a bull market uptrend................................................................................................Thanks
 
It appears that you do not have a favorable view on Fundamental analysis,yet I noticed in another thread you look at the forward earnings yield curve of the S and P as a barometer for going long???

And what in the world is conventional fundamental anaysis vs non conventional ???

You should define technical analysis as you have a very narrow focus on what it is....

Are you familair with stat arb,pairs trading ???

Do you trade derivatives?? Long or short vol??


dozu888 said:
the biggest problem is the fundamental approach, that is once you get brain washed by 'technical analysis 101', you look at the market as a mysterious, heartless, soulless beast.

to about the same degree, conventional fundamental analysis has the same problem.

therefore both approaches fail to see what this game truly is - the smart money picking the pockets of the dumb, day after day.

sentiment and manipulation, the 2 biggest factors driving price movement in the intermediate term, a few days/weeks/months, or in conventional terms - the swing trades, are ignored by both camps.

that's why TA's fail rate is so high, because it's always several steps behind... it has to react what the price has done, many periods ago... or if you react too fast you get chopped... you can never tell if a move is true or a head fake, until it's really late;

Situational Analysis (R) however, as illustrated in my thread and numerous posts, look at the pro boys moves (price and media push) in correspondence with the dumb money sentiment, gives you a clearer picture and you are rarely wrong. A true move happens at the ripe moment, just as head fakes happen when the sentiment conditions are not ready yet.

this is why I keep calling TA garbage because once you experience the clarity of SA(R), conventional TA is far too inferior.
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taowave said:
It appears that you do not have a favorable view on Fundamental analysis,yet I noticed in another thread you look at the forward earnings yield curve of the S and P as a barometer for going long???

And what in the world is conventional fundamental anaysis vs non conventional ???

You should define technical analysis as you have a very narrow focus on what it is....

Are you familair with stat arb,pairs trading ???

Do you trade derivatives?? Long or short vol??
More...

conventional being looking at company value metrics in an isolated way;
technical analysis for dummies stuff;
there are of course more fancy methods but they cannot escape the fate of self-defeat.

I don't trade fancy... straight buy and sell.
 
For futures, TA when used correctly shows the current trend. Think of it this way, you are driving your car on the freeway. Eventually all freeways end. Your GPS will tell you when you need to get off of the freeway to get to your location.

TA will tell you if you should even get on the freeway, when to get off, or if you should get on the freeway that is going in the opposite direction.

Remember TA is not 100% correct. So you need Trade Management to let you to get off the freeway right now since you took the wrong freeway.

Assuming you don't automate the system and trade manually like I do, by taking a "limitless" pill, you will remember how to use your TA correctly.
 
Ok. On a serious note. From a non-technician who nonetheless always incorporated TA into his decision tree.

I always thought it healthy, on major breakouts of significant support and resistance that after the breakout, it is retested. So looking at a long term chart, I see the major-major resistance that was 1600 spx, and recognize that after the breakout it was never retested and would now be a 50% replacement from current levels.

Sounds nuts but I remember in '07 saying to someone something similar about the upward sloping trendline and how the market could go back to 800 and still be holding the major uptrend.

Just thoughts from a non TA'er at a 10,000 ft perspective.
 
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