Continue reading...Remember the article called Our Jack – the trader who should be a loser, but wasn’t and who should have been more profitable, but didn’t care a jot? Well, I bumped into Jack the other day which was a happy coincidence because I’d been reading a fierce argument on Trade2Win about whether Technical Analysis (TA) ‘worked’ or not. I knew Jack used TA, so I was anxious to hear his views.
“Works”, laughed Jack, “It’s just a tool, you know, which just as much ‘works’ as Alexandros’s hammer and chisel did in sculpting the Venus de Milo. No, dear boy, it’s you and me that ‘works’ not the tool.”
I thought that sounded somewhat fanciful so I asked Jack how he used TA as a tool. “I use it to make assumptions about what price might do,” he said, “but it’s how I manage the assumptions and the money that determines whether my account increases or decreases over time. Let me explain.
First, some obvious stuff, but bear with me. Price moves in mysterious ways, but...
Last edited by a moderator: