Whats useful and not useful in technical analysis

A

artieboy

Obviously all traders have a bias to what is useful and not.....Now my experience is limited....in the sense that i cant say i have had 10 years + of trading experience

But here is my honest opinion of what seems to work in technical analysis......
-looking at support resistance and drawing trendlines
-fibonacci appears useful
-and yeh even elliot wave

Other than that i am not a fan of stochastics, MACD and moving averages.......the trend can be seen with just a glance of the chart. OK so what about you guys?
 
I don't get how fib is useful . . . .any stock is going to retrace between 38, 50, and 61 . . . if it retraces 54%, which one is that? Good enough for trading stocks?
 
Quote from artieboy:

Obviously all traders have a bias to what is useful and not.....Now my experience is limited....in the sense that i cant say i have had 10 years + of trading experience

But here is my honest opinion of what seems to work in technical analysis......
-looking at support resistance and drawing trendlines
-fibonacci appears useful
-and yeh even elliot wave

Other than that i am not a fan of stochastics, MACD and moving averages.......the trend can be seen with just a glance of the chart. OK so what about you guys?
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I agree with you, I would only add simple moving averages of 20,50,200 day, which seem to be used by alot of poeple (don't forget to many indicators can be analysis paralysis)
 
Quote from billyjoerob:

I don't get how fib is useful . . . .any stock is going to retrace between 38, 50, and 61 . . . if it retraces 54%, which one is that? Good enough for trading stocks?
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I know what you mean its not exact.....
i often use 50%....it doesnt always work, but we all get losses every now and then......
Actually i don't trade stocks, just forex....maybe its more applicable to forex?
 
Quote from artieboy:
----what seems to work in technical analysis......
----not a fan of stochastics, MACD and moving averages.......
More...
1) You may want to include something having to do with volatility breakout and expansion. "Critical" times of the trading day have significance too.
2) Those things you don't like are "backward looking". Therefore, they have no predictive value. :cool:
 
Some indicators or MA have more value than others just from the fact that they are popular and more people use them. Like the 50 or 200 SMA.
 

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IMO you have to define what you are trying to achieve with your analysis and some model of how the market is working to decide what is and isn't useful.

Someone with a different goal (type of profit capture say) and different model will have different preferences. Many things that people say are not useful or are lagging could be useful if they support your model.
 
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