in my opinion TA is a bunch of bull s h it...
however on the other hand, TA only work when the bunch of fools believes in TA.
Let me give u all an example:
Lets say in a room of 10people. and got a stockA...
ANd i propose to u a TA theory... i call it the fiboCCB_LJ theory. according to limbeh's theory i say, if stockA goes above $1, then it will break resistance n chiong up.
Then all 10fools inside the room believes the theory.
Oneday, the stockA goes > $1,. Person1 saw it, buyyy... price hit 1.01. Person2 saw it... buyyy up, hit 1.02... person 3 saw it , he buyyyy 1.03... etc etc etc...
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Now, if u analyse the above, stockA chiong up is bcos the bunch of fools believe in my socalled fiboCCB_LJ theory. and it did not chiong just because my fiboCCB_LJ theory is true.
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Now come to the real world, u imagine, one day, nobody believes in MACD, bollinger, ur fiboCCB retracement, idi0t wave analysis anymore. What will happen?
--> ALL YOUR TA fails!
But fortunately, there are many fools in this world believing in something with no scientific evidence. TA is a belief, not a theory.
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Now come back to sg stocks. i m very surprise some people uses TA in local stocks. locally it is like this: imagine a room of 10 people. 8 of them are retailers. only 2 of them is a BB, he holds HUGGEEE amount of cash.
as long as the BBs buyyyyy, stocks goes up..
as long as the BBs selllllll, stocks goes down..
NOT BECAUSE OF YOUR ILLUSIONIED TA!
U just imagine, your TA reads say for example China Milk, BUYYY due to a combination of TA...
But the substantial shareholders (holding huge amount of shares) all wants to sell, because they somewhat know the insider news is very bad. Something very wrong which u dunno of.
Hence, u buy, u die pain pain..
--> the above is an arbitrary example.
Forget your TA, it don't work in sg market.
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4 comments:
Sorry but i disagree with your belief that TA does not work. TA works by analysing the price and volume data. Even if no one believes in it, people, including insiders, will still have to buy and sell at some price, thus generating new data for technical analysts to use. Prices rise when there are more buyers than sellers, and basic TA can be used to measure the buying power vs. the selling power. I understand that people tend to fear and shun what they do not fully understand, so I hope that you have mastered TA before choosing to condemn it as such.
Cheers
Spencer
hi spencer,
i have been using TA for the past 3years, and i do try and claim that i have mastered TA, even though some people say i m using the wrong indicators.
One day, and same as WB, i find that TA DON'T WORK at all.
Even if it works it is not due to TA.
I give u another example. A primary6 year old kid. he got A A A A A for the past primary 1-5... now he PSLE, u based on his PAST PERFORMANCE just like TA (looking at past charts), then u predict his PSLE is A... But, there is a BB, an insider, who already know that this kid will get a F because he fall sick on that day.
--> Now no matter how powerful your reading of the A A A A A whatever head and shoulder shampoo or whatever, u r just reading a past chart of something that has already happened, u can never beat somebody who knows insider news which he knows for sure what will happen.
in summary, TA will not work
Another example: Rallyartist from CNA forum claimed his H&S already hitted Dubai default. I told him: You read your Head n shoulders shampoo, u see huge selldown or buyup, watever... there could be 100001reasons... either bad news or good news.. or fed going up rate, or China going to lower tax, or US bank going to collapse soon. Or it could be a faked selldown/rally tricks by BBs.. got infinity combination can be intepreted by looking at the chart, candlelight dinners sticks or watever chart u using.
Your H&S DID NOT TELL YOU STRAIGHT ONTO YOUR FACE got Dubai default..
Hi ZKL,
"Even if it works it is not due to TA"
Hmm, based on your reasoning that there are many reasons for something to happen, how can you be so sure that TA doesn't work but must be due to some other specific causes?
If rallyartist's Head and shoulders tell them to sell and save him the sorrows of enduring the dubai crisis, I think TA would have served his causes already.
Treat TA, FA or both as guidebooks and not as Holy Grail. There is no Holy Grail in trading/investing.
TA/FA can only help to guide us into believing that we are not making stupid mistakes when we lose money; use them as excuses to comfort our sorrows/angers; use them as learning platform to further improve our trading/investing skills.
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