Does technical analysis work or not?

Does technical analysis work in your opinion?


  • Total voters
    54
Apr 4, 2016
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#31
So how would your TA-based market entry be any different from a random one?
There is no difference regardless the the chosen entry method. In order for the bank to make a profit, they have to move price against you. The direction and method of entry is irrelevant. Given that the price move is so predictable, maybe someone can take advantage of it. Being able to predict the future must have some value.
 

forker

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Jul 12, 2008
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#32
We all know news events are volatile and it should be expected to violate any form of analysis. That doesn't mean TA is useless all of the time!
 

babyjake1961

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Oct 25, 2012
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#33
There is no difference regardless the the chosen entry method. In order for the bank to make a profit, they have to move price against you. The direction and method of entry is irrelevant. Given that the price move is so predictable, maybe someone can take advantage of it. Being able to predict the future must have some value.
Yet we all make different entries in different directions at different times, based on our individual understanding of technical analysis. So how can banks profit by moving the price against each one of us?
 

babyjake1961

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Oct 25, 2012
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#34
We all know news events are volatile and it should be expected to violate any form of analysis. That doesn't mean TA is useless all of the time!
Sure, but you can't temporarily exit the market with your trades that have reached neither TP nor SL by the news time - which isn't even always known, whereas data is released all the time and you can't tell which bit of it will turn out to be a major market mover.
 

dbphoenix

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Aug 24, 2003
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#36
Indicators or chart patterns or whatever else that you use as a basis in your TA. The economic data released or officials' statements don't care about any of that anyway when they hit the market. The same is with fundamental analysis: not only you need to guess an outcome of an event but also the market's reaction to it. Sure, you can do it sometimes but consistently if you're not privy to insider info?
None of that matters. Indicators lag too much. Patterns are unreliable. But if one is trading shifts between demand and supply, he can trade the shift. These shifts cannot be hidden as they are illustrated by the trades themselves.

Db
 
Likes: Oscar Reed
Apr 4, 2016
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#37
So how can banks profit by moving the price against each one of us?
One common way way is to spike the price to reel the profit in from one direction and lock in the people facing the other direction for later consumption. This is a function of news events.

TA is useless against these type of actions because these are based on the present positions which bear no relation to past patterns (as a consequence of previous positions) that TA might have analysed.
 

forker

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Jul 12, 2008
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#38
One common way way is to spike the price to reel the profit in from one direction and lock in the people facing the other direction for later consumption. This is a function of news events.

TA is useless against these type of actions because these are base on the present positions which bear no relation to past positions that TA had analysed.
This might have been common practice years ago, it isn't today. Liquidity providers make spread and swap. There is too much competition these days for any one to purposely spike prices. The result of them doing this will be less clients doing business with them and they don't want that.
 
Apr 4, 2016
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#39
This might have been common practice years ago, it isn't today. Liquidity providers make spread and swap. There is too much competition these days for any one to purposely spike prices. The result of them doing this will be less clients doing business with them and they don't want that.
Spiking is common occurrence that happens every week. You don't trade, so you might not know.
 

forker

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#40
You are just assuming now.
 

babyjake1961

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Oct 25, 2012
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#41
I don't see it as evil banks/brokers deliberately moving prices against us. They just sit comfortably on the other side of our trades knowing the market is impossible to predict consistently which guarantees their inevitable win and our loss in the long run, making it all just a matter of time.
 
Apr 4, 2016
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#42
I don't see it as evil banks/brokers deliberately moving prices against us. They just sit comfortably on the other side of our trades knowing the market is impossible to predict consistently which guarantees their inevitable win and our loss in the long run, making it all just a matter of time.
Prices are moved by fairies then ? If someone tells you prices in Walmarts are set by fairies, would you believe them ? Perhaps it's quite a normal practice for shops to set their prices ? There's nothing evil about it. The price should be set at a profitable level or what would be the point of running a business ?
 

babyjake1961

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Oct 25, 2012
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#43
Prices are moved by fairies then ? If someone tells you prices in Walmarts are set by fairies, would you believe them ? Perhaps it's quite a normal practice for shops to set their prices ? There's nothing evil about it. The price should be set at a profitable level or what would be the point of running a business ?
Prices are moved by buyers and sellers of one currency for another (in case with Forex) in accordance with their need for a specific currency at a specific point of time and/or their own speculative price projections. As they seldomly trade in unison and there are unpredictable multiple factors impacting their decisions that hit the wires all the time, the price movements are essentially impossible to predict consistently.
 
Apr 4, 2016
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#44
Prices are moved by buyers and sellers
Shop prices are always moved by the seller. This can be demonstrated by your walking into Walmart and demanding the prices to be moved. It won't work. The prices will only move when the seller is good and ready, and for their own purpose alone.
 

babyjake1961

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Oct 25, 2012
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#45
Shop prices are always moved by the seller. This can be demonstrated by your walking into Walmart and demanding the prices to be moved. It won't work. The prices will only move when the seller is good and ready, and for their own purpose alone.
Clearly, I meant transactions, not any verbal demands.