Rambings:
I am a anti trendline and classic patterns man. Before the information age, we had to try to use patterns as a means of analyzing charts. we were blessed with $5 calculators and computers conducting analysis in seconds. Now I wish no one was ever told about H&S, flags, triangles, etc. Why?
They bring in the subjective too much and are often slow and wrong. The eyeball is often fooled. Any time we start drawing lines or looking for patterns, subjectivity takes over. Let your measures be objective ones, especially if you are new to TA. When I see someone speaking to this or that pattern being formed and I look at chart. I can call up 10s of indicators that detected weakness or direction before the pattern emerged.
If you think a pattern is in place, check the weekly, it should confirm it. Like trend lines? use an objective channel measurement. Trend lines often are good after 90% of the run is in place. But channels drawn by set rules would capture the same information.
Try to have objective measures, use the subjective ones for confirmation, if you don't trust them.
Now I have put on cycle lines and cardinal numbers recently. Did anyone look at them? Is anyone using them? they are a form of prediction. You keep them in mind in your trading. But you system shouldn't be built on them. The same for self drawn lines and patterns.
The Japanese seem to famous for candlesticks, but those who have taken the time knows KAGI, RENKO, and 3 step are the real power. Candlesticks are good visual tools, they can sometimes be used for confirmation. |
