There’s something uncanny about technical analysis.
More often than not, just before an apparent market turning point, technical analysis tends to position the trader appropriately.
Now that’s saying a lot.
Why could this be so?
At the base of every big move in the market, there are always “insiders”. These are people “in the know”, i.e. the smart money. These people pre-empt a market move with their smart money, because they possess certain market-moving information that most others don’t have.
Fortunately for us, their market behaviour registers on our charts. Today our data-feed is as good as any institution’s data-feed, and with that the face of this whole game has changed. I would go on to say that today our personal data-feed with all its paraphernalia (including social-networking sites) is so fine-tuned to the individual it is servicing, that it is better for that individual than any institution’s data-feed.
And that’s saying everything. When a big trend starts out, its seeds first register on a Twitter timeline. Simultaneously, its initial behaviour registers on one’s laptop in the form of charts. This enables one to position oneself as per the move. Also, even the potential intensity of an upcoming move can be indicated in the charts, so that one can decide the trade size based upon this if one wishes.
Thus, by the time the public latches on to the information, the technical analyst has already entered the trend.
Same goes for exits. As smart-money exits, technicals push one to enter exit orders that are to be triggered by a falling market. If the market then actually falls, the trading platform pushes one out of the market automatically.
In a choppy market, technicals stop you out a couple of times, and then you need to read the cue and take a break. Go on a holiday or read a book. Yes, technicals are telling you here to lay off the market for a while.
The bottom-line here is that a serious market player cannot afford to ignore technicals.
So give it a shot. Learn technicals. All resources are available on the web, and most of them are free of cost.