Headlines:
1. Wall Street’s Ubiquitous Snake Oil.
2. Imperfect Predictors Of The Past.
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Price Charts = Exceptionally Beneficial Pictures To Both Investor/Trader…
Reflecting Both Current Expectations + Historical Price Performance.
However…The Hundreds Of Associated/Layered Derivative Technical Indicators Such As =
1. Moving Average +
2. MACD +
3. RSI
Measuring =
1. Momentum +
2. Relative Performance +
3. Thrust
= 100% Waste Of Time…
As No Matter How Infinitely…
1. Configured +
2. Prioritized +
3. Shuffled
Their Ability To Even Moderately Assess/Predict Future Price Performance = At Best = 50/50
…Especially When Reviewed/Tested Over Multi Cycle/Year Periods…
Versus Recency Biased + Truncated Time Frames.
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The Primary Flaw/“Head-Fake” With Derivative Technicals =
Trending Markets/Securities =
Higher Highs/Higher Lows & Vice-Versa For Shorts…
As Derivative Technicals Appear To Be Relatively Reliable…
But They Are Just Mirroring Price…Which = Nothing Heroic.
However…When The Trending
1. Breaks +
2. Concludes +
3. Devolves
…Derivative Technical Signals Are Unreliable + Fail To Produce Acute Execution Triggers.
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Furthermore…A Frequently Under-Appreciated Factor Regarding Derivative Technical Measures =
100% Price + Regression Based.
Thus…A Great Paradox With Derivative Technical Application =
Backward Looking Derivative Technicals Are Applied To Forwardly Discounting Equity Securities =
Which Might Also Explain Why Derivative Technicals = No More Reliable Than A Coin Toss.
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Attempts To Structure Decision Making In Chaotic Financial Markets = Makes Good Sense.
However…Markets = Not If/Then Science That Can Be Precisely Mapped + Measured.
Rather…More Often…
Markets =
1. Adaptive +
2. Emotional +
3. Exuberant +
4. Vindictive
Not Surprisingly…Like The Humans Behind The Market’s Curtain.
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