Reading Assignment: Reading Assignment: Does Technical Analysis Work?


#1

Time for the first reading assignment of this course. This is an interesting one, especially if you are new to technical analysis. Read this blog post (https://medium.com/@cryptocreddy/does-technical-analysis-work-fa90413a8328) and answer the following questions in this forum thread.

  1. How does the writer define technical analysis?
  2. What are technical analysts looking to identify in the market?
  3. How would you summarize the authors argument that technical analysis works?

#2

I like Cred and his TA videos are good too…

1.TA is defined as a risk management tool used to identify higher probability, actionable and risk defined (entry/exit targets and R) trades

  1. TA analysts are looking to identify an edge to make higher probability trades with risk management.

  2. The article was good and Cred’s videos on TA are good too. TA works… it takes understanding, continuous study, patience and risk management to be profitable. TA is not a price prediction or market prediction crystal ball, it is a tool set used by traders to build a set of rules (market edge) used to identify higher probability trade setups along with risk management.


#3
  1. Technical analysis is a risk management tool that can be used to derive probabilistic, actionable, and risk-defined trading setups on an instrument

  2. identify a strategic edge with increasing the probability of success whilst managing the risk.

  3. TA - G00D.
    TA - N0T price prediction but to give a market edge to reach own set goals.
    TA - is higher probability trades along with better risk management.


#4
  1. How does the writer define technical analysis?
    " technical analysis is the practice of analysing the price history of an instrument in order to make actionable, risk-defined forecasts of its future price ."

  2. What are technical analysts looking to identify in the market?
    Probability of bullish or bearish movement

  3. How would you summarize the authors argument that technical analysis works?
    It’s about personal risk management not you vs profession investors.


#5

How does the writer define technical analysis?

Technical analysis is the practice of analysing the price history of an instrument in order to make actionable, risk-defined forecasts of its future price.

What are technical analysts looking to identify in the market?

Technical traders, are looking for better odds and for their setups to render them profitable over enough trades.

How would you summarise the authors argument that technical analysis works?

By not asking whether technical analysis can predict the future but rather if they are able to identify and execute a trade setup offering asymmetric Risk vs. Reward.

Technical analysis works because the requirements it has to meet for that to be true are not unreasonably high. It doesn’t have to predict the future, nor must it outperform better equipped professionals. As long as it helps traders identify and trade asymmetric risk:reward trade setups, then it works.


#6
  1. How does the writer define technical analysis? Technical analysis is a risk management tool that can be used to derive probabilistic, actionable, and risk-defined trading setups on an instrument.

  2. What are technical analysts looking to identify in the market? Asymmetric risk/reward trade setups

  3. How would you summarize the authors argument that technical analysis works? Technical analysis works because the requirements it has to meet for that to be true aren’t to predict the future or that it must outperform better-equipped professionals. As long as it helps traders identify and trade asymmetric risk/reward trade setups, then it works.


#7

How does the writer define technical analysis?

The writer sums up technical analysis as a tool used to manage and mitigate risks associated with investing on a given instrument.

What are technical analysts looking to identify in the market?

They are looking at maximising their odds of predicting a profitable situation for them.

How would you summarise the authors argument that technical analysis works?

The author puts greats emphasis on the fact that technical analysis works only if you are willing to be a dedicated practitioner.

Not all technical analysis is equal — it’s much more likely to work for someone who takes it seriously (disciplined, systematic, etc.) than someone who just takes a punt


#8

How does the writer define technical analysis?
Ans: Technical analysis is the practice of analysing the price history of an instrument in order to make actionable, risk-defined forecasts of its future price.

What are technical analysts looking to identify in the market?
Ans: TA is done to find conditions which will maximize the profit for technical analysts.

How would you summarise the authors argument that technical analysis works?
Ans: Technical analysis ‘works’ because the requirements it has to meet for that to be true are not unreasonably high. It doesn’t have to predict the future, nor must it outperform better-equipped professionals. As long as it helps traders identify and trade asymmetric risk:reward trade setups, then it works.