Originally posted by: LegendKiller
Originally posted by: jjsole
Screaming for "data" isn't going to get you any justification for your ignorance about the markets. TA isn't a 'tool', its an approach, from which people have created tools for (some better than others, lol). And its not an indicator that says 'this gives a statistical advantage therefore its justified'. TA is a very general term that simply refers to a way of looking at movement in the markets to identify opportunities.
For that matter, even fundamental analysis uses 'TA' because any sensible person is going to take the rate of change of a PE over time and take that into consideration. Rate of change is a 'TA' term, and rate of change of the price is 1/2 the equation, so technically that is a form of TA afaic.
Aside from that, you can't suggest that analysis of price over time has no relevance and that the markets are 100% efficient. Buying begets buyers, and selling begets sellers...that's human nature and a great example of how opportunities are formed.
And its the analysis of movement over time that's going to identify this, not PE's (altho PE's can do it too since price is part of the equation). For myself, I've done about 40k trades since I started and it would be bizarre for anyone to call my returns "luck" (which have always been waaay beyond the s&p, except 1 year). If you're into "data", you know that luck wouldn't be a coherent conclusion for consistent results.
And afaic, all it takes is one person making money consistently over time with one or more quantifiable TA 'tools' to prove it works, because it's not the unsuccessful people that use TA which prove it doesn't work, its the ones (no matter how few) who have learned ways to use the approach that prove it can work.
/edit: Another note, all of the professional and institutional trading firms use a form of TA when quantifying their bids and offers within their program trading algorithms. Their supercomputers aren't coded to look at changes in PE's every millisencond, they're doing a sophisticated analysis of price movement over time, down to each tick and each millisecond and so on etc. to generate bazillion trades every day. There are a lot of different objectives in these programs, but if you take the major market makers, they are all electronic driven and based on price movement over time to make their markets. Their algorithms might be rocket science, but the technical approach to it isn't.
lol @ my "ignorance" of TA, sorry chucklehead, but I've read dozens of studies on TA. You and foolio up there STILL have not provided ONE study that has shown TA works.
Then you compare it to the trading strategies the desks at banks use? Even better. They don't sit there looking at resistance points or other bullshit. They take advantage of much more sophisticated analysis on a micro scale. Comparing the two only highlights your inability to understand why TA, in the forms that you guys can practice, is a joke.
Sure, they can take advantage of micro movements in the market, relative price differentials, different types of trading strategies, by instantly analyzing hundreds of equities in a second to find the inefficiencies in the market (it is not a long-term outlook on prices, but a shorter term one, since they buy and sell often within minutes). Sure, that is "technical analysis", but it is a far higher level of it and one that you'll never be able to touch.
TA is a tool, just like different types of scientific tests are tools. They are tools for determining what actions to take next. However, the way you guys use TA is a joke.
At the end of the day, as mentioned before, you STILL have not shown a single piece of information to back up your assertion.
All assertions are meaningless without the data, they are anecdotal and statistically insignificant.