Zignals blog: Technical Analysis: is it worth anything?Trading Signals

Zignals blog: Technical Analysis: is it worth anything?Trading Signals

Nicely put, especially the previous comment sums it up: "it does reflect the way that many people see the market". We can argue ad nauseam about the lack of statistical proof that technical analysis works but, you know what, what people believe is what ultimately matters and moves markets. Academia has long despised technicians but trading based on such beliefs is outright dangerous, "the market can remain irrational much longer than you can remain solvent", to put it with John Maynard Keynes. Possibly, this either-or technical-versus-fundamental perspective reflects a binary perspective of past times. Technology has turned our times from the age of "or's" to the age of "and's"and greater complexity in the investment approach - featuring a blend of technicals AND fundamentals may be the way to go. Recently, some less dogmatic and market-smart fellows such as MIT Professor Andrew Lo, have published an interesting book called "The Heretics of Finance", featuring interviews with leading market technicians. Such humility is one of the key traits of virtually anybody who wants to work hard and reconsider their own views of the world in order to be successful. I'd urge any aspiring trader or investor to be very, very prudent in dismissing the "other" approach as total hogwash.