I'm fairly new to technical analysis and hope that someone might be able to assist me. I have read about price patterns, their probabilities and how to interpret them, yet I'm not sure how and when to trade it or jump in. Any help will be appreciated.
erick,
I moved this to the Fearless Forecaster board since more folks will see it. If we get some good responses, I'll move it back to the IU board.
Thanks for asking!
Mark
I moved this to the Fearless Forecaster board since more folks will see it. If we get some good responses, I'll move it back to the IU board.
Thanks for asking!
Mark
Well you'll get a hundred different opinions here.
You might want to read the Tactical Review section in the Edwards and Magee book as a starting point. This link has a summary of portions of the book.
http://www.ttrader.com/dirttime.php
Technical Analysis of Stock Trends by Robert Edwards and John Magee
http://www.ttrader.com/dirttime.php
Technical Analysis of Stock Trends by Robert Edwards and John Magee
Article on accumulation, markup, distribution and markdown, 10 pages.
http://f6.grp.yahoofs.com/v1/MB1TQZnPT5GtG.../DemandR14r.pdf
http://f6.grp.yahoofs.com/v1/MB1TQZnPT5GtG.../DemandR14r.pdf
Head over to StockCharts School and spend a few weeks on the basics. You will see those charts used by members here, many will be "tweaked" by the members. (nuggets IMO) 
Once you have a grasp on the basics you will see a lot of charts here that will get you on board. Ask questions of the posters, folks are willing to assist.
Once you have a grasp on the basics you will see a lot of charts here that will get you on board. Ask questions of the posters, folks are willing to assist.
At the most basic level, 2 things have proven to be most helpful
1. Take a straightedge and draw trendlines on any chart. Let the trendlines guide you.
2. Ask any kid if the chart is going up or down. Follow his/her advice.
If these 2 aren't working for you, study the chart and decide what you think you should do. Then take a small amount of capital and do the opposite. If it works out for you, slowly apply more and more capital till you become comfortable being a contrarian.
Now if you really want to get deeper than that into technical analysis, it can get very murky quickly as you'll have indicators telling you opposite things and you'll have to figure out which ones to listen to at any given time and which ones to ignor.
The answer to that typically depends on determining if you are in a trending market or a sideways rangebound market. In the end, numbers 1 and 2 above might be the simplest answer to that anyway.
Good Luck,
Echo
1. Take a straightedge and draw trendlines on any chart. Let the trendlines guide you.
2. Ask any kid if the chart is going up or down. Follow his/her advice.
If these 2 aren't working for you, study the chart and decide what you think you should do. Then take a small amount of capital and do the opposite. If it works out for you, slowly apply more and more capital till you become comfortable being a contrarian.
Now if you really want to get deeper than that into technical analysis, it can get very murky quickly as you'll have indicators telling you opposite things and you'll have to figure out which ones to listen to at any given time and which ones to ignor.
The answer to that typically depends on determining if you are in a trending market or a sideways rangebound market. In the end, numbers 1 and 2 above might be the simplest answer to that anyway.
Good Luck,
Echo
Your statement about using a straight edge is a good one, and it reminded me of a similar activity. You can easily draw Hurst channels freehand like Jim Curry does, and they seem to me to be as good as any fancy software could do. As you widen the channel, shorter trends one direction can slowly become fine detail in a longer trend in the other direction.
It was a great discovery to me when I saw a post on a yahoo forum asking Jim how he drew his Hurst channels and he answered freehand. Try it. It is fun and works better than you might think.
This will give you a sample of what they look like: Jim Curry
It was a great discovery to me when I saw a post on a yahoo forum asking Jim how he drew his Hurst channels and he answered freehand. Try it. It is fun and works better than you might think.
This will give you a sample of what they look like: Jim Curry