Charting: The Newest Bubble? Part 3
Charting and the followers of the chartist are getting killed. Witch-hunters are out in droves wanting to accuse whoever they can of whatever they can get away with on a regular basis. Because people refuse to take the responsibility for their actions and followings, it will not be long before this bubble bursts.
What I have tired to show is everyone can have equal access to all information and indicators of charting. Regardless of investment style all facets of charting should be part of the investment tools and considerations of anyone putting money in the market. I now use Charting as a reference tool to fundamentals. I am not going to be lazy and not do the due diligence but instead use charting for advantageous entries and exits. However, I do fully realize all long-term market price directions are inevitably determined by supply/demand forces.
All participants would be best served to find the balance between fundamental analysis (to know why they invested) and technicals (to know when to position) is the key for anyone. They will have to become comfortable combining fundamental and technical analysis into a system that attempts to capture the best of both worlds. However, my basis will remain fundamental analysis in order to give me a long-term perspective on the market. Primarily because I am true a believer that economic forces ultimately control the direction of a market. So by doing the fundamentals I will be able to determine what the basic factors are that will affect the longer-term direction of the market. Then once I have established the fundamentals I will use technical analysis for timing of the trades for entry and exit, and how aggressive I want to be with a particular trade or position.
Technical Analysis and charting varies from the very simple to the advanced, as to give an advantage to the bottom line goal of increasing the odds of trading and gainful success. Still, most Chartist will agree the first place to start is with the most basic technical tools, many of which have been time tested to determine both their strengths and their weaknesses. However, do not expect a Charist to give up there indicator set points. Remember that the main reason they chart is to get a clear advantage on the market.
The ultimate and responsible person is not going to follow blindly as a sheep taken in every charting word of an interdomus, but instead set up their own chart. If for no other reason that to verify and confirm the interdomus’ posting.
One key note: The key to charting is volume. The stock must have interest or charting is unreliable. Chartist rarely get involved with stocks that so not have interest.
Hey just my opinion and I could be wrong!
Gary Swancey
