Caution regarding Technical Analysis

Bulliontrader · #1 17th April 2006, 10:21 AM

Hi all,

Many people here talk on providing market forecasts on Techinical Analysis(TA). Many new traders also trying to learn all technical fundas.

I am an expereinced trader, and One point I can surely say that Techinical analysis wont take u anywhere in commodites market.

Many technical analysts have failed in recent Bull run in Gold, Silver. Actually this market doesnt move on charts and levels. All charts are drawn as per market movement, and then all Support and resistance levels are drawn.

Commodites move on Fundamentals and its also a news driven market. People should learn basic principles of economics first and should have a good source of market to market information.

Techinicals work only in a range bound market. But its people who trade on fundamentals, who really profit in this volatile market.

Current volatility has made it more risky for techinical analysts. All people who follow TA, should better, consult a fundamental analyst with a proven track record, for better results

Mareeche · #2 18th April 2006, 11:16 PM

Quote:

Originally Posted by Bulliontrader

Hi all,

Many people here talk on providing market forecasts on Techinical Analysis(TA). Many new traders also trying to learn all technical fundas.

[b]People offering market forcasts on TA is a different matter and is best left to the moderator.
I am an expereinced trader, and One point I can surely say that Techinical analysis wont take u anywhere in commodites market.

your premise that TA wont take you anywhere in commodities markets is flawed least to say. TA originally became popular in the west in the commodity markets and not equity markets. I dont think markets are any different except that our markets are highly manipulated and operated as they are still in the nascent stage. This does not make TA any less relevant.

Many technical analysts have failed in recent Bull run in Gold, Silver. Actually this market doesnt move on charts and levels. All charts are drawn as per market movement, and then all Support and resistance levels are drawn.

The second premise that many technical analyists have failed in the recent bull run of gold and silver is also flawed. Both were in a super trend and a trend is in force until there is a clear indication of a reversal in trend. if people blindly assume that a correction is due just because a stock or commodity has gone up so much is harakiri.

Commodites move on Fundamentals and its also a news driven market. People should learn basic principles of economics first and should have a good source of market to market information.

Agree that Commodities move on fundamentals and its mainly deliverey based and good market information and understanding of weather patterns, crop cycles etc should complement TA to forecast the markets even better.

Techinicals work only in a range bound market. But its people who trade on fundamentals, who really profit in this volatile market.

Current volatility has made it more risky for techinical analysts. All people who follow TA, should better, consult a fundamental analyst with a proven track record, for better results

Technicals only work in a range bound market. Well this is something new to me. About People who trade on fundamentals really profit in this market..its the people who are privy to inside information who are successful. fundamentals and inside information are enitrely two different things.

cheers to all

amarnath · #3 20th April 2006, 06:50 PM

Quote:

Originally Posted by Bulliontrader

Hi all,

Many people here talk on providing market forecasts on Techinical Analysis(TA). Many new traders also trying to learn all technical fundas.

I am an expereinced trader, and One point I can surely say that Techinical analysis wont take u anywhere in commodites market.

Many technical analysts have failed in recent Bull run in Gold, Silver. Actually this market doesnt move on charts and levels. All charts are drawn as per market movement, and then all Support and resistance levels are drawn.

Commodites move on Fundamentals and its also a news driven market. People should learn basic principles of economics first and should have a good source of market to market information.

Techinicals work only in a range bound market. But its people who trade on fundamentals, who really profit in this volatile market.

Current volatility has made it more risky for techinical analysts. All people who follow TA, should better, consult a fundamental analyst with a proven track record, for better results

I am rolling on the floor . It seems you have least understanding on price following techniques and TA aspects of trading may be you are experinced in watching market for more time and reading news . May be many failed but i dont know how you know how many failed and how many made pips isnt its just your assumption that many failed bcoz they followed TA i think you misunderstood TA from fancy TA analyst .

Its a true fact 90% ppls loose in speculation either they follow TA or FA or both or none wining all depends on % of edge they hold over market and their style

TA dont work as it as it is trader's job to know how to make it to work for him its just a tool like brick to build building similarly just news cant work as FA its the collection of market sentiment , News its long term and short term outlook from traders prespective , Techincal are the force behind market moves .

IMO its more or less market sentiment that drives market rather than just news what you call FA based trading say for eg if mkt sentiment is bullish even a -ve news can be easily discarded and even slightly +ve news can be appreciated too much but no one can exactly explain how market sentiment develops change over time what a TA analyst see on his charts as ebbs and flow of in secondary form i.e price .

Bulliontrader · #4 24th April 2006, 10:54 AM

I think both u guys are using your Techinial tools a lot and dont have any knowledge on fundamental analysis.

Kindly lt me know how much u earn on your investments per month, so that I can guide u better how to trade.

U are senior here,but newbies in market.Please restrain from posting rubbish and half baked knowledge, if u have no idea how the market moves.

All those TA guys, can u tell me reason for current Bull run and sudden steep fall on Thursday 20th april and again rise, as per your TA.

Please get your facts right before replying.

amarnath · #5 24th April 2006, 02:07 PM

Quote:

Originally Posted by Bulliontrader

I think both u guys are using your Techinial tools a lot and dont have any knowledge on fundamental analysis.

Kindly lt me know how much u earn on your investments per month, so that I can guide u better how to trade.

U are senior here,but newbies in market.Please restrain from posting rubbish and half baked knowledge, if u have no idea how the market moves.

All those TA guys, can u tell me reason for current Bull run and sudden steep fall on Thursday 20th april and again rise, as per your TA.

Please get your facts right before replying.

Yes i can explain these case and show a system that made profit just using TA

but you cant understand as it seems you even dont know to read english

. Pls re read wat is meaning of market sentiment

. Dont waste readers precious time and bandwidth .

It seem you prefer forecasting with FA aspects which is certainly not necesary to make profits or to remain profitable it just your assumption

vince · #6 24th April 2006, 02:52 PM

Bulliontrader,

Most of the traders, seniors or juniors on this forum who use TA are only trying to help others to trade better, by sharing their knowledge.

If you have some knowledge FA or otherwise,which you think others are not aware of lets hear it.

We are all here to learn.

Bulliontrader · #7 24th April 2006, 03:17 PM

Dear Vince,

Many people go for TA, but any experienced trader, can tell u that all those charts, candle bars are drwan as per market movements.Can any computerised system tell u why market is moving up or down? No

Many option traders use charts to determine levels, for placing bets. But trading options is entilrey a diff. game

Gold market or any commodity market, moves on fundamentals on medium and long term basis. lt is also a news driven market, more of rumour based too. If u want to trade, speculativley,then think from a specualotrs mindset.

Basic knowledge of fundamentals, micro and macro economics, demand supply ratio is rquired. Also good source of all economic events is required.

I know both FA and TA,and have seen that TA sometimes can be very risky in this market.Current bull run in gold, when it went above 9300 in mcx, many analysts started giving calls of selling gold.Imagine a guy with small equity or day trader, who can easily incur loss in his position in a single day and will exit in loss.

I also use TA, but very limitedly and it is not suited for a new trader, to trade entirely on TA basis.

My point is to prevent peopel from trading using TA only or giving calls on TA basis.

If u want to learn more about this market, I am suring willing to discuss detailed trading fundas.

Regards

Traderji · #8 24th April 2006, 03:22 PM

Bulliontrader,

Appreciate your concern, but we all use different methods to achieve the same goal.

If you are willing to share your fundamental methods with the members here then please do so. I am sure many of us will be enlightened. You can start by posting in the Fundamental Analysis forum.

AJAY · #9 24th April 2006, 09:14 PM

Hi Bullion Trader,
According to me one important and basic point is missing here. It is neither Fundamental Analysis nor Technical Analysis that gives money to the trader or investor in any markets. It is the psychology of that particular individual, which makes him stick to the principle of Trading or Investing what he follows,whether it is a derivative of TA or FA, that gives money in the form of profits.

Is FA an art or science or TA an art or science? According to me nothing is a science or art. Here only the principle that each individual adopts, either from FA or from TA, is a science. And keeping the mindset of sticking to that principle in trading or investing is art.

So, I request you to stop pointing out that TA doesn't work and FA works.

And I also request you to share whatever the knowledge you want to share and share it while taking the pleasure of sharing and we are all here to receive it with all positive minds, as we are all open to listen, understand and accept, if we find it's making a lot of sense as described by you.

Thanks in Advance.

Eagerly waiting to hear from you.

AJAY

Bulliontrader · #10 24th April 2006, 10:29 PM

Quote:

Originally Posted by amarnath

Yes i can explain these case and show a system that made profit just using TA

but you cant understand as it seems you even dont know to read english

. Pls re read wat is meaning of market sentiment

. Dont waste readers precious time and bandwidth .

It seem you prefer forecasting with FA aspects which is certainly not necesary to make profits or to remain profitable it just your assumption

Daer TA guy,

If I doesnt know english, do u know.What is market sentiment, if u use TA??
Any answer. No
If u see market sentiment then, its not TA. U are trading on news, both fundamental and rumours.Where is your TA comes in to picture.Did your TA told u that Iran issue will come and gold and crude will rise.

Actully u didnt like my reporting your pseudo marekting signal service.I dont knwo waht your education or experience is. But I am sure u not a good trader.

Better get your facts right sweetie

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