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Gold/Mining/Energy : T.ITE: iTech Capital (TSE) -- Ignore unavailable to you. Want to Upgrade?

To: Nawien Sharma who wrote (1045)	9/29/1999 11:07:00 PM
From: keith massey	Respond to of 5053

Nawien The manner in which stocks are traded is dependent upon several external and internal factors. For example: - is the company under analysis capable of sustainable growth, - is the market in which they conduct business viable and growing, - is the customer base spread out or reliant on a few big customers etc., etc., etc. For short term trading none of these factors matter...the chart almost always tells the whole story. All of the factors you mentioned (fundamentals, investor emotions, politics, wars, etc.) are already built into chart....this is the basis of technical analysis. However other than JDX I am usually in and out of a stock in a couple of hours (day trading) to a couple of days (swing trading) so normally long term factors don't really matter. The futures (Bonds, S&P, Gold, etc.) are the biggest technical game in town.... I'm sure it doesn't hurt to look for trends but will you feel comfortable enough to lay some money on it ? In a heart beat (or faster)....the only way to play the futures short term is using trend and pattern analysis. For day trading the only way to play is using technical signals...there is really no other way. I know in the early 90's, small brokerage houses in New York were reluctant to use neural networking software. They found that the software worked fairly well with currency fluctuations and some forms of derivative trading but they couldn't explain why. I guess it really depends on how you define "neural network". If you are referring to a "neural network" as learning system with numerous inputs than this has never been my game and you are right that most traders don't use this type of learning system. However between 20-30% of the daily volume you see in the future and stock pits is trading computers at work. Some have simple trend following algorithms, some use complex trading system, and a few do use "neural networks"....but I can assure you that they all trade on technical signals alone. Best Regards KEITH