Murtaza Hussain on Warpcast

Murtaza Hussain pfp

Murtaza Hussain

One of the most insane things that people seem to take seriously is "technical analysis" of crypto or stock prices. I have never seen any predictive power behind this, its basically akin to astrology and is more like a fun hobby to help with fantasizing about future wealth. Social media has created an entire genre of freelance technical analysts with lots of charts and predictions that never seem to correspond much to reality. Its good fun if you look at it that way but please do not take it too seriously.

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Varun Srinivasan pfp

Varun Srinivasan

It's not entirely fake like astrology - momentum based trading strategies did work once upon a time (c.f. turtle traders) and are still used as short term signals. But the vast majority of charting is just absolute nonsense.

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Thomas pfp

@aviationdoctor.eth

My favorite is the ubiquitous tautology along the lines of, “if it breaks this resistance it will go up, otherwise it will go down” (and vice versa for support lines). In the famous words of Homer Simpson, “d’oh”

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Rando pfp

@chasing-pointers

there is predictive power and it's all voodoo. Both things are simultaneously true. The predictiveness falls in the domain of behavioral finance: enough people believe it, despite it being nonsense, that it creates tradeable opportunities to exploit.

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ionspired pfp

painted it 2 yrs ago and haven’t changed ever since 😁 hedge fund traders were laughing at me in the beginning hah. S&P log scale vs normal. check the other comment i left

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agrimony↑🎩 pfp

agrimony↑🎩

Yeah ta is really trying to read market sentiment. But I'm not surprised that it kinda works https://www.smh.com.au/business/small-business/millionaires-dont-have-astrologers-billionaires-do-20131206-2yuag.html

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sean pfp

it works because it’s a self fulfilling prophecy

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Beninem pfp

My job out of college was to backtest hundreds of technical analysis indicators and pour through dozens of academic studies on various TA indicators to find the rare diamonds. And you're right to a certain extent. 99% of technical analysis is garbage, with Dunning Kruger effect firmly screwing with traders and indicators only spread further because at one time an indicator "worked" and so then salesman/snakeoil folks took it over and the indicators are usually easily frontrunnable or gameable and so the TA indicators stop showing any predictiveness. To say there's no predictive power though is to not have seen the 'right' things. For example take any kind of objectively simple, scientifically testable and historically backtestable plain vanilla Sentiment indicator and you'll find they're usually quite predictive. Human emotions at extreme sentiment points provide excellent contrarian exit/entrance points which can always beat out buy-and-hold strategies on a risk-return basis.

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Brahtoshi 🐸💜🎩 pfp

Brahtoshi 🐸💜🎩

charting is just astrology for men

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frdysk.framedl.eth pfp

frdysk.framedl.eth

It's mostly insider news/trading imo Fcfs

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Future of Radio pfp

Future of Radio

Chart the lows not the highs.

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gill pfp

analyzing patterns on an asset chart is simply analyzing human behavior. some price areas tend to cause specific behaviors. there are fancy names and "technical" and what not but in the end, just human behavior plotted on a chart. and that's why it works well enough to give valuable information, humans are predictable beings.

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Sean pfp

If you’re reading and analyzing charts, you’re too late.

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✿ Gil Alter ✿ pfp

✿ Gil Alter ✿

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silly goose pfp

I think that technical analysis works from the point of view that many people believe in it and trade as if it exists — hence we have all the figures; It doesn't help us to identify whether the price goes up or down, but helps to identify points of interest (potential big movements) - where trading basically makes sense (higher risk - higher reward).. When making the decision itself it’s perfectly fine to use basically any pattern, they all are equal in predictability, — be it technical analysis or a coin toss, or any esoteric practices — if (and until) that actually works for you (call that luck)..

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JestemZero pfp

For those that really use it as intended, it's a great tool. If they are good with it. Most people just dabble and think that those cool lines they draw are using. But TA is supposed to 100% take emotions out of trading and rely on historical data of the collective human psyche. Humans are notoriously repetitive and the psychological effect on profit/loss can be quantified. It's never accurate since it's based on probabilities which are by definition an expectation and not a fact. So you're probably not far off. It's likely worse than astrology for most people. And useful for a fraction of those that actually employ it.

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Alexxa pfp

Yeap 100% Opinions almost never have anything in common with the reality. The simplest example I keep experiencing every time are the sports commentators/expectations/loud headlines that are like 80% of the time happen to be incorrect.

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Mack pfp

Belief becomes reality. If enough people are convinced how a market *should* behave, that inherently changes how it behaves

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Spaceman Spiff 🎩🍖 pfp

Spaceman Spiff 🎩🍖

@spaceman-spiff

So much noise in the TA space. There is one account I follow that has taken a data based approach and doesn't offer advice, but instead creates a thesis. The key difference between this accounts and most is he also provides a negation for the thesis. I have seen him use a data driven approach to predict shifts from bear to bull and back. He isn't always right, but he doesn't pretend to be. I've found his model to be very helpful for investing.

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