Tag Archives: chart patterns
Why do some chartists turn ad hominen when their practice is challenged? The plausible answer is that they are frustrated by continuous failures and are acting under the influence of backfire effect cognitive bias. In essence, there are people who … Continue reading
A recent failure of an island reversal pattern in the chart of the 10-Year Note yield adds to a long list of failed chart patterns in the last few years and reinforces claims that they are random formations. In the … Continue reading
Even some academic researchers have fallen into the trap of trying to quantify the performance of patterns used by visual chart traders, such as for example triangles, head and shoulders, support and resistance and trendlines. Quantification of such patterns requires … Continue reading
Classical technical analysis has contributed to the largest non-violent wealth-redistribution in the history of mankind. Modern technical analysis is not doing any better.
Hopes of a double top in XLU were shuttered yesterday after a violent squeeze that took ambitious shorts by surprise. A gain of 2.27% in just one day should be enough to convince all chart traders that obvious formations fail more often … Continue reading
I am saying the obvious but I know some will deny it: Anyone who makes bets in a game of chance without having a measure of the expectation is a naive gambler. This is what many traders do when they … Continue reading