Showing posts with label d. CHART ANALYSIS. Show all posts
Showing posts with label d. CHART ANALYSIS. Show all posts

A Chart Is My Map Of The Market

I'm not a big fan of technical analysis.

I do however study charts.

What’s the difference?

Plenty I say!

To me, technical analysis involves making decisions under the influence of indicators. Indicators like the MACD, the Stochastic, the RSI.

I don't like indicators much!

They confuse the hell outta me!

Charts on the other hand give me clarity.

A chart on its own reveals to me the price action without the distortion.
Charts show me the peaks and troughs, the highs and the lows, the periods of excitement and the periods of boredom.

All of this is represented in diagrammatical form.

A chart is my map of the market. 

A chart helps me plan my trip.


Analysing Charts: Is Chart Analysis Meant To Be Subjective?

I like to flick through stock market magazines.

There’s usually a section where some highly respected expert brings up a chart of an index or stock then gives their expert analysis of what might happen next.

The expert might draw in a few trendlines, chuck in a couple of support and resistance lines, and sometimes even throw in a triangle or two.

This is all done to explain their view on the market.

When I read other people's chart analysis I always end up thinking the same thing.

Why on earth would you place your trendline there?

Let me tell you what I’ve come to realise about chart analysis.

One person’s support is another person’s resistance.

One person’s uptrend is another person’s downtrend.

Chart analysis is by nature SUBJECTIVE.



I like to look at charts to determine where to place my stop and profit target.

My decisions are based on my understanding of the chart in front of me.

They are based on my gut feel about where I feel the market is heading at the time. 

I believe that Chart Analysis is subjective and it's meant to be.

If you want other TRADING IDEAS, all you have to do is Click Here!
Subscribe to: Posts (Atom)