Reading Assignment: Reading Assignment: Does Technical Analysis Work?

TA & Algo Trading Course
#281

  1. Technical analysis is a risk management tool. It can be used to find trading setups that are more likely to work in our favor. Of course, with the use of risk management.

  2. Technical analysts are looking for better chances to make their trading settings profitable in a large enough number of trades.

  3. The author emphasizes the fact that technical analysis only works if you are willing to be a dedicated practitioner. He also concludes that technical analysis cannot read the future, but it will help you find a higher probability of a good setup and reduce the risk of trading.

2 Likes
#282

  1. "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. Technical analysis is a risk management tool used to derive probabilistic, actionable, and risk-defined trade setups.

  3. Technical analysis works if it can help a trader gain an edge on the market and secure positive returns.

1 Like
#283

TA is the practice of analyzing the price history of a coin in order to make actionable, risk-defined forecasts of its future price.

Using tools to minimize risks and maximize their odds of predicting a profitable trade.

TA works only if you take it seriously and that you are doing it to manage personal risk and not competing with professional investors.

#284

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.
#285

1.just a probabilistic tool for actionable trade.
2.looking for a bullish and bearish trend.
3.for higher probability of trade and better risk management.

1 Like
#286
  1. TA is a risk management tool that can be used to derive probalistic, actionable, and risk-defined trading setups on an instrument.
  2. Identify a strategic edge with increasing the probability of success while managing the risk
  3. TA-G00D
    TA-N0T price predition but a market edge to reach own set goals
    TA-is higher probability trades along with better risk managment
1 Like
#287
  1. Is a tool to be used as a source, to try and set out trading set ups to try and manage the probability in risk so you can implement an action based on your findings
  2. Price History, forecasts of future price, Asymmetric set ups
  3. I would summarise the authors argument as trying to make as understand that if we are systematic, discipline and very selective, it becomes a risk management tool that could generate new ideas. By also using technicals vs fundamentals we can use both analysis to convert our findings into actionable trades to whatever reasonable goals we have outlined for ourselves. Furthermore he also is arguing the comparison of the retail traders (like myself) vs professionals and the assumption that neither either is secure and are definitive in their predictions. Technical analysis is not equally based just because we use it for the sake of using it, rather its on the premise that analysis is a tool and it’s only as good as its user.
1 Like
#288

  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 trade setups on an instrument. Technical analysis is not a method to logically deduce the future price of an instrument.

  2. What are technical analysts looking to identify in the market?

They are looking to identify and execute a trade setup offering asymmetric Risk:Reward.

  1. How would you summarize the authors argument that technical analysis works?

The author says that technical analysis might work or not, depending on who is using the technical analysis. He says that is not a magical crystal ball to see what the prices are going to be tomorrow, but one can use it to identify and execute a trade setup with asymmetric Risk/Reward ratio, but it is up to the one who uses technical analysis to do it. He also says that fundamental analysis is key , and cannot be left out of the equation when trading, specially if you are a guy alone trading from your desktop (which I am).

1 Like
#289
  1. How does the writer define technical analysis?
  • He defines it as 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.
  1. What are technical analysts looking to identify in the market?
  • Technical analysts are looking for asymmetric opportunities that they can use their probabilistic trading strategies to capitalize on.
  1. How would you summarize the authors argument that technical analysis works?
  • He argues that it works by saying that the requirements in order to state that it works is quite low and therefore very achievable.
1 Like
#290
  1. How does the writer define technical analysis?
  • Technical analysis is a probabilistic risk management tool that can generate new trade ideas and convert price forecasts into actionable trades.
  • The writer emphasizes that TA is not about trying to predict the future, but setting and adjusting probabilities.
  1. What are technical analysts looking to identify in the market?
  • A trade that would offer asymmetric risk-reward ratio.
  1. How would you summarize the authors argument that technical analysis works?
  • As long as it allows a trader to identify the trades with asymmetric risk-reward, so that the trader overall makes some profit, TA works.
1 Like
#291

  1. How does the writer define technical analysis?
    The writer defines humbly technical analysis is the practice of analyzing the price history of an instrument in order to make actionable, risk-defined forecasts of its future price. Going further he combines the principles, and believes the utility of technical analysis is best summarised as follows: technical analysis is a probabilistic risk management tool that can i) generate new trade ideas ii) convert price forecasts into actionable trades .

  2. What are technical analysts looking to identify in the market?
    Technical Analysts are looking to identify better odds and for their setups to render them profitable over enough trades.

  3. How would you summarize the authors argument that technical analysis works?
    Technical analysis is a good, risk management tool that can be used to derive probabilistic, actionable, and risk-defined trading setups on an instrument. However, technical analysis is not “telling the future” but to provide a forecast based on historical numbers to where the most probable scenario can present itself.

3 Likes
#292

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 analysts are looking for patterns and signs on current and previous data that helps give them an edge and a positive expectancy in the market(s) they trade through forecasting.

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

It works because it doesn’t have to meet high requirements in order for it to be successful. It doesn’t have to predict the future or outperform professionals it just has to help traders balance Risk vs. Reward

1 Like
#293
  1. Technical analysis is the practice of analyzing the price history of an instrument in order to make actionable, risk-defined forecasts of its future price;
  2. Identify a setup offering asymmetric Risk:Reward;
  3. TA works because generate risk-defined trade setups.
1 Like
#294

  1. Technical is the practice of analysing the price history of an investment in order to make actionable risk defined forecasts of its future price.

  2. Technical analysts are looking to carve out an edge and a positive expectancy in the markets they trade.

  3. I would summarise them as, technical analysis can’t read the future but will help you find pasterns and reduce your risks of trading in an asset.

1 Like
#295

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

  2. identify and execute a trade setup offering a good Risk:Reward ratio.

  3. It does work if you put in the work. It doesn’t really matter how the ‘competition’ is doing relative to you as long as you’re meeting whatever reasonable goals you’ve outlined then it works. If it helps with managing risk, and helps with identifying trade setups it works

2 Likes
#296
  1. 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. New profitable trade ideas using risk management as a tool.
  3. Personal risk management to improve trading experience, balance between technical and fundamental analyses.
1 Like
#297

1: Not about predicting the future but using statistical data and observation to make better decisions and increase likelyhood of having good trades

  1. paterns seen in the past that have a likelyhood of happening in a similar maner

#298

Hey @Von, hope you are ok.

3. How would you summarize the authors argument that technical analysis works?

Have you forget to type your answer to the 3rd question?

If you have any more questions, please let us know so we can help you! :slight_smile:

Carlos Z.

1 Like
#299
  1. technical analysis is a probabilistic risk management tool that can i) generate new trade ideas ii) convert price forecasts into actionable trades .
  2. identify and execute a trade setup, offering asymmetric Risk:Reward.
  3. In my view he shows that whatever strategy you choose and tools it helps you to implement a strategy with your own personal determined risks and rewards.
1 Like
#300

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 trade setups on an instrument

What are technical analysts looking to identify in the market?

Subsequently, using technical analysis, you can look for an actionable, risk-defined trade setup in line with your bullish/bearish forecast.

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

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

1 Like