When I started trading, I thought that using RSI or MACD would help me predict the times to buy and sell the FTSE. One morning, I woke up and realised that the index is just the sum of movements of individual shares - how could it be manipulated by traders. Surely, the FTSE or the DOW are simply a matter of randomness and cannot be predicted with any certainty.
If I make gains every day for one month, then surely I will make losses to offset those gains in future trading.
Is it therefore inherently safer to bet on the movements of shares or currencies where traders chart and may actually manipulate (unwittingly) its price?
It really depends on the logic you're coming to this from. It seems you're looking to out-chart other chartists, so you're directly competing on skill at technical analysis. On the other hand, I see technical analysis as a tool for analysing trader psychology.
Lets say a share dives down fast. A lot of people are likely to think "Hey, it's a good price now, lets buy", and it will probably bounce. That's not because they're doing technical analysis, that's just the nature of the market. Lets say then that the UK as a whole is seen to be doing poorly. Suddenly the entire FTSE 100 is mostly going down, and so it mostly underpriced, and the index will therefore dip and then bounce.
Personally I think neither fundamental or technical analysis works well alone. I've got an automated trader that's pure technical because it has to be, but doing this by hand I'd recommend that you use fundamental analysis to determine the direction the market will go in next, and technical to decide entry/exit points and confirm trades. I wouldn't use it as a decision maker for direction, for manual trading.
Oh, and random walk... utter drivel. Random walk would be truly random, while the market fairly clearly has trends. I've frequently heard of referred to as "Random walk around the currect price" - even more drivel. You can't randomly walk around a point, it makes no sense, it's not random if you're tethered! It may not be obvious that there's a pattern, and the non-randomness may be small enough to be unprofitable, but trust me when I say the market looks NOTHING like truly random.
