Formal Studies in Technical Analysis

omkarmango · #11 10th July 2008, 01:29 AM

Quote:

Originally Posted by oxusmorouz

Interesting but true. A lot of these "analysts" can't differentiate between random data and real stock data.

When I showed them this chart: (price is multiplied by 1000)

8/10 people started analyzing it by giving supports, resistances, fibo retracements, even trendlines and EW counts. Worse, one even inferred that it is a textile stock and started talking about how bad fundas look for textile cos. It in fact is purely random data.

Stationary throughout, lacks fat tails and is bluntly simulated (not even as complex as the one mentioned in the paper). Unlike the real one:

Oxy,

I dont know how you simulate this.
But I still think this is either a real chart of some trading instrument or derived from it.

I dont believe this as entirely random data.

Omkar

uasish · #12 10th July 2008, 09:50 AM

Omkar,

Metastock reads .csv files of Excell,if you simulate (using RANDOM for O,H,L,C) in excell & save as .csv & later on with Downloader change to Metastock format,that will look like this.

Asish

omkarmango · #13 10th July 2008, 09:50 PM

Asish,

Thanx for the info. (I never used simulators OR random number generators.)

I dont have the particular data series also. but when overlayed the image file on my AB, strangely I found some essential elements of a real chart in it.

Too much of a coincidence...

either oxy genearated it taking the elements in to account (a possibility as he renamed the file initiating with zz.. coincidently I have the same habit)
OR its real data.

Omkar

trader111 · #14 10th July 2008, 09:51 PM

Which elements of a real chart have you found, please explicate.

Have uploaded a XL sheet which generates random chart:
http://www. 4 shared .com/file/54643162/65afeeac/random_chart.html
(copy-paste link but remove spaces before hitting enter)

oxusmorouz · #15 12th July 2008, 12:21 PM

Quote:

Originally Posted by omkarmango

Asish,

Thanx for the info. (I never used simulators OR random number generators.)

I dont have the particular data series also. but when overlayed the image file on my AB, strangely I found some essential elements of a real chart in it.

Too much of a coincidence...

either oxy genearated it taking the elements in to account (a possibility as he renamed the file initiating with zz.. coincidently I have the same habit)
OR its real data.

Omkar

No sir, it is entirely random with 0 memory.

sudoku1 · #16 12th July 2008, 12:32 PM

Quote:

Originally Posted by omkarmango

Oxy,

I dont know how you simulate this.
But I still think this is either a real chart of some trading instrument or derived from it.

I dont believe this as entirely random data.

Omkar

even if it is a random one....its in a med term uptrend if the last 6 months r taken in consideration..

exact supports can b found if the graph would had been on jawa ...

oxusmorouz · #17 12th July 2008, 12:41 PM

Quote:

Originally Posted by sudoku1

even if it is a random one....its in a med term uptrend if the last 6 months r taken in consideration..

exact supports can b found if the graph would had been on jawa ...

Yes, a coin toss game with 3 heads in a row is in a short term uptrend, 6heads in a row is in a medium term uptrend and 10heads makes it a long term uptrend. I guess for a short term uptrend, the support is at 3 heads? And if it breaks 3 heads, I guess it is headed for 6heads where it will find a strong resistance? I also guess it goes to 6heads from 3heads, it will find support at 4 heads because of 61.8% fibo retracement from 3-6 is near 4? The trading world survives on people like you.

sudoku1 · #18 12th July 2008, 01:03 PM

Quote:

Originally Posted by oxusmorouz

Yes, a coin toss game with 3 heads in a row is in a short term uptrend, 6heads in a row is in a medium term uptrend and 10heads makes it a long term uptrend. I guess for a short term uptrend, the support is at 3 heads? And if it breaks 3 heads, I guess it is headed for 6heads where it will find a strong resistance? I also guess it goes to 6heads from 3heads, it will find support at 4 heads because of 61.8% fibo retracement from 3-6 is near 4? The trading world survives on people like you.

Cheat & love but don't love & cheat.

Think & love but dont love & think.

Break the heart & love
but don't Ever love & break the heart..

trader111 · #19 12th July 2008, 02:28 PM

Quote:

Originally Posted by sudoku1

Cheat & love but don't love & cheat.

Think & love but dont love & think.

Break the heart & love
but don't Ever love & break the heart..

What exactly oxusmorouz did was pour a bucket full of cold water on your head full of bias and opinions. Cmm'on dude, you can thank him.

trader111 · #20 12th July 2008, 02:40 PM

Quote:

Originally Posted by ijredart

Yes, this is why it is not quite easy to explain why/ how technical analysis works?

Actually many people here have taken the pains to explain in detail why TA works to utter n00bs. But those are not willing to work out, or expect to be spoon fed will always complain.

Ahh CV... now I can understand why you were talking about private forum. I concur.