Stock Markets: The $64000 Question: Does Technical Analysis Work?
The question whether technical analysis [TA] [or 'charting' as referred to by the less initiated] works has been asked many, many times. Countless studies have been done, some of which show that TA does make a significant difference, and some show that TA does not make any difference to investment performance. For more details of such studies, see: http://en.wikipedia.org/wiki/Technical_analysis . I will use this short article just to recollect my personal experience with TA. For more than a decade, I studied TA, and tried to apply it. I studied all manner of TA from classical charting, to Candlesticks, to the hundreds of Indicators from Moving Averages, to RSI, MACD and the more esoteric ones ones that are constantly being invented. I read about Elliot Waves and Gann Charts, and how some even used astrology to analyse the markets. I delved into Neural Networks, Genetic Algorithms and all manner of pattern recognition, classification and forecasting techniques to feed the Pric...