Does Technical Analysis Really Work?

[South Park]

I am seeking the opinion of the experienced and voicing my opinion.

I think if a training is 100% for learning, 1% of it is technical analysis and the rest 99% is psychological games..Because I have been learning and trading technical analysis for a long time but mostly I lose. I am still learning after that. I've noticed lately that big investors can handle trading as they please. Because they have a lot of funds, if they take a small amount, they take big trades and destroy it. In which case technical analysis is not enough. And I think psychological analysis plays a big role along with technical analysis.


But I don't have any psychological knowledge about trading. Looking for expert opinion on psychological mind set.

What have you done to learn TA? Because if you keep losing then it is obvious you are doing something wrong, have you really took your time to learn TA? Because this is easy to say but hardly anyone actually does it, have you done this for months, read several books about it, paper trade your strategy and use demo accounts? If you have not then this could easily explain why you keep losing, now if you took the time to do this then it is possible the explanation for your losses comes not from the level of your skills, but your inability to deal with the movements of the market, and in that case learning more about the market psychology could help you.

[Easteregg69]

I think the RSI can be manipulated with high frequency order distribution.

[Zaguru12]

I am seeking the opinion of the experienced and voicing my opinion.

I think if a training is 100% for learning, 1% of it is technical analysis and the rest 99% is psychological games..Because I have been learning and trading technical analysis for a long time but mostly I lose. I am still learning after that. I've noticed lately that big investors can handle trading as they please. Because they have a lot of funds, if they take a small amount, they take big trades and destroy it. In which case technical analysis is not enough. And I think psychological analysis plays a big role along with technical analysis.


But I don't have any psychological knowledge about trading. Looking for expert opinion on psychological mind set.

I think the psychological mind set actually shapes who you are In the trading market. There are many great technical analysts there they can predict the market from chart very well but to have that psychology to stay in the market is a problem. A clear example is people that do easily come out of their winning trades just because they are afraid to allow the trade to run and later they regret it because the trade yields a good return. Another people suffering for psychological problems is traders that easily close a losing position easily most of this trade bounce back and goes their way.

The best way to handle your psychology is to trade with an amount you feel you can lose. Using this will allow you to stay without panic as this is the reason why most close there trades. Calculate your position well to check how much you’re going to lose when your trade hits stop loss and then see if you can afford to lose that or change the size. As you progress your psychology will improve with little wins and smaller losses

[Russlenat]

If you want a market that investors are not manipulating, go for high marketcap coins like bitcoin. You are trading low marketcap coin is the reason you are seeing manipulation.

Technical analysis is still very important in trading.

Trading is very risky generally, even including trading bitcoin.

There is nothing like psychological analysis. The third type of analysis is sentimental.

Trade with amount of money that you can afford to lose.

Look for more strategies to win. You can try averaging.

As much as fundamental analysis is vital, technical analysis also creates high importance most particularly if you are in day trading. Knowing the history of price movements is very essential so you’ll be able to predict the future price of the coins.

However, talking about psychological analysis, which I think is more known as sentiment analysis, the real challenge there is how to keep being optimistic despite of the unpredictable market. By sticking to what you can only afford to lose, that is an effective way to get rid of greed and control your emotions as much as possible, and because trading requires separation from our emotions.

[Monarch B]

I understand it really depends on the individual. How my skills are depends on me. Skills must be acquired over time.

Skills acquired along the way if we continue to trade and learn. Indeed, losses are not the thing we want to happen but it is been said that it is a helping situation for us to learn how trading works and it also helps us to find ways/strategies that will work in a certain condition. We lose money but we gain knowledge. But this never says that it remains like this as we find ways how to improve our trading skills and using tools such as Technical Analysis brings huge changes to the results. If many traders have seen it was helpful to them, that was impossible it never be helpful to you as well. Maybe it has never been applied right or your analysis needs to improve.

Thanks, That's why I still trying to mastery in TA. Hope I success in the future.

[Monarch B]

I think the RSI can be manipulated with high frequency order distribution.

I have worked with RSI but it is wrong in my case. Maybe not yet aware of its proper use. I basically want to master Moving average..

It seems simple to me that there are many mistakes in RSI. If you want you can tell me the correct usage of RSI.

[LogitechMouse]

Re: Does Technical Analysis Really Work?

Yes, it works, but don't look at it like a crystal ball where it can predict anything with 100% accuracy because it will never happen.
TA is what the analysts are using aside from the Fundamentals, but even the expert analysts are still making wrong predictions that's why some analysts are sharing their predictions on both sides (downward, and upward).

Now the question is "Does TA work in bull run?" because we know that during the bull run, nothing is going down, but it's all going up. I'm not an expert in TA, but I don't think that it's necessary if you want to invest. What I mean is that, when we are in a bull run, you can still make an analysis, but it doesn't matter because coins are going up at a fast pace.

TA works, but relying on it alone isn't enough. You need to know the sentiment of the investors and the fundamentals.

[stomachgrowls]

Re: Does Technical Analysis Really Work?

Yes, it works, but don't look at it like a crystal ball where it can predict anything with 100% accuracy because it will never happen.
TA is what the analysts are using aside from the Fundamentals, but even the expert analysts are still making wrong predictions that's why some analysts are sharing their predictions on both sides (downward, and upward).

Now the question is "Does TA work in bull run?" because we know that during the bull run, nothing is going down, but it's all going up. I'm not an expert in TA, but I don't think that it's necessary if you want to invest. What I mean is that, when we are in a bull run, you can still make an analysis, but it doesn't matter because coins are going up at a fast pace.

TA works, but relying on it alone isn't enough. You need to know the sentiment of the investors and the fundamentals.

You would really be finding its relevance on the time that you would really be stepping your foot into this market. You would really be able to realize that you would really be mainly needing it because there's no other
way that you could be able to read up charts and candlesticks but by just through it. This is why it is really that important that you should really be knowing the basics. As you do go far ahead and gaining up sufficient experience then the more you do be able to learn up further advanced TA's on which it is something that would really be beneficial for you.

There are really just those people who cant really be just be able to spend up some time on trying out to learn those things but rather they do make out some speculations out of thin air or
having no basis or simply they are really taking up that gambling method on which its never been that recommendable in the first place.
People who do able to survive and sustain this market are the ones who are really that trying out to earn and have a good grasps.

[pinggoki]

No one knows how the crypto market will move so that means that technical analysis will only work about 50% of the time and I think that's the most generous percentage of it's effectivity, some have said that it's not going to work at some point and I do agree that it can happen because sometimes things are just so volatile that it's difficult to follow by the book.

[crwth]

From what I have read from your post, it's about the psychological mindset that is set on the "market psychology" not with your personal or self mind when it comes to disciplining and managing your assets/resources. Mindset is one of the things that you would consider if you ever are interested in being successful in trading.

So you need to understand both stances.

• Market Psychology
• Self Psychology

I think there are more technical terms but I can't think of it right now. You really need just to understand how the market would lean or go to and with the self psychology, it would be the controlling of your emotions.

It plays with the technical analysis. It has roles that you need to consider as well.

[bettercrypto]

I am seeking the opinion of the experienced and voicing my opinion.

I think if a training is 100% for learning, 1% of it is technical analysis and the rest 99% is psychological games..Because I have been learning and trading technical analysis for a long time but mostly I lose. I am still learning after that. I've noticed lately that big investors can handle trading as they please. Because they have a lot of funds, if they take a small amount, they take big trades and destroy it. In which case technical analysis is not enough. And I think psychological analysis plays a big role along with technical analysis.


But I don't have any psychological knowledge about trading. Looking for expert opinion on psychological mind set.

I can't say that TA is not able to help us get profit from the trading activity that we do or do every time we are inside an exchange platform. But this is only if you have extensive knowledge of trading. Because TA is useless if you have no idea about trading.

Well, according to my observation, when we are at the height of the bull run, I think it is difficult to apply the TA because, of course, the market is unpredictable. And what we're going to see is bullying, and most people know that it's hard to keep up with that, to be honest.

[mindrust]

TA is just another tool in the toolbox. Let’s say you are a carpenter. Does a carpenter only use a hammer? No, he has many other tools to shape/fix furniture. TA is just like that. It gives you an idea of where the markets are but it is not the only tool you should depend on. If you only use TA to make your decisions then it won’t do you any good. Does TA work? It works if you are able to see the big picture. In the hands of a blind man, no tool can work.

[Monarch B]

TA is just another tool in the toolbox. Let’s say you are a carpenter. Does a carpenter only use a hammer? No, he has many other tools to shape/fix furniture. TA is just like that. It gives you an idea of where the markets are but it is not the only tool you should depend on. If you only use TA to make your decisions then it won’t do you any good. Does TA work? It works if you are able to see the big picture. In the hands of a blind man, no tool can work.

I think, By big picture you mean the psychology behind the trading. You have explained well but I am convinced that technical analysis does not work 100%. It basically depends on the individual and how they look at it.

[Monarch B]

From what I have read from your post, it's about the psychological mindset that is set on the "market psychology" not with your personal or self mind when it comes to disciplining and managing your assets/resources. Mindset is one of the things that you would consider if you ever are interested in being successful in trading.

So you need to understand both stances.

• Market Psychology
• Self Psychology

I think there are more technical terms but I can't think of it right now. You really need just to understand how the market would lean or go to and with the self psychology, it would be the controlling of your emotions.

It plays with the technical analysis. It has roles that you need to consider as well.

Market Psychology: What is the way to understand it? Or market psychology can be understood through technical analysis.

In fact I have been lagging behind for the past six months. Trying to understand know it is not possible to learn or master it in such a short time. But of course I need a better way.

[mindrust]

TA is just another tool in the toolbox. Let’s say you are a carpenter. Does a carpenter only use a hammer? No, he has many other tools to shape/fix furniture. TA is just like that. It gives you an idea of where the markets are but it is not the only tool you should depend on. If you only use TA to make your decisions then it won’t do you any good. Does TA work? It works if you are able to see the big picture. In the hands of a blind man, no tool can work.

I think, By big picture you mean the psychology behind the trading. You have explained well but I am convinced that technical analysis does not work 100%. It basically depends on the individual and how they look at it.

By big picture, I mean your ability to use other tools, bring them together, make an art/product out of them. Like a carpenter or a painter does. Let's say there are 2 different traders. One of them only use TA/indicators and nothing else. The other one can use TA if he wants to but he is also able to make sense out of the major market events and world news. He understands human psychology, he read lots of books about it. He has good education, can understand multiple foreign languages, good at math even though he doesn't really need it for trading... Also he runs a business and knows how to value a business. That means he understands fundamental analysis too.

Imo, the second trader's chances of winning in the long run is like 90% while the first trader who only uses TA has like 10% chances to win. (by "winning", I mean making considerable amount of money. Like doubling or tripling the initial investment)

That doesn't mean that the educated trader can't fail. He very well may turn into a major loser.

Imagine these traders both are chess players. The first one is playing blindfolded because he only has access to one tool. (only his hands lol) The other one has all the advantages. That's the difference between them. Can the first dude win? He can if a lightning bolt strikes the same spot twice.

[Monarch B]

TA is just another tool in the toolbox. Let’s say you are a carpenter. Does a carpenter only use a hammer? No, he has many other tools to shape/fix furniture. TA is just like that. It gives you an idea of where the markets are but it is not the only tool you should depend on. If you only use TA to make your decisions then it won’t do you any good. Does TA work? It works if you are able to see the big picture. In the hands of a blind man, no tool can work.

I think, By big picture you mean the psychology behind the trading. You have explained well but I am convinced that technical analysis does not work 100%. It basically depends on the individual and how they look at it.

By big picture, I mean your ability to use other tools, bring them together, make an art/product out of them. Like a carpenter or a painter does. Let's say there are 2 different traders. One of them only use TA/indicators and nothing else. The other one can use TA if he wants to but he is also able to make sense out of the major market events and world news. He understands human psychology, he read lots of books about it. He has good education, can understand multiple foreign languages, good at math even though he doesn't really need it for trading... Also he runs a business and knows how to value a business. That means he understands fundamental analysis too.

Imo, the second trader's chances of winning in the long run is like 90% while the first trader who only uses TA has like 10% chances to win. (by "winning", I mean making considerable amount of money. Like doubling or tripling the initial investment)

That doesn't mean that the educated trader can't fail. He very well may turn into a major loser.

Imagine these traders both are chess players. The first one is playing blindfolded because he only has access to one tool. (only his hands lol) The other one has all the advantages. That's the difference between them. Can the first dude win? He can if a lightning bolt strikes the same spot twice.

 That's Cool Men, Thanks. I have to think of different ways and bring something good out of it.

[Questat]

No one knows how the crypto market will move so that means that technical analysis will only work about 50% of the time and I think that's the most generous percentage of it's effectivity, some have said that it's not going to work at some point and I do agree that it can happen because sometimes things are just so volatile that it's difficult to follow by the book.

50% is just an assumption, it is even lower or higher than that. Not because people did not know or know about TA but also due to the unpredictable market trend. That is why trading is risky and hard as we can't make a perfect call even if we are trading for a long period. This means that using TA or any trading tools never assures a secured profit, we can be wrong and we possibly lose because of the market volatility. If OP is suffering and having difficulties in making analysis, it may be he is not yet good, he possibly needs more time and experience.

[Queentoshi]

In which case technical analysis is not enough.

Technical analysis works but knowledge of technical analysis is not what is only needed before you can start trading. You need understanding of trends, market structure, moving average etc and then master the psychological side of trading. If a trader master 99% of psychological side of trading and does not understand the 1% of technical analysis, they will still not be successful traders. As a new trader you have to understand all angles and sides of trading is important and generally necessary for your success as a trader, we do not have to pay less attention to one side of trading and expect to become very successful. if you must be very successful as a trader you must pay attention to all aspects of trading both psychologically and technically.

[Unbunplease]

In my opinion, technical analysis works as long as the manipulator allows it to. The manipulator knows very well how to manipulate charts and crowd sentiment. That is why you cannot blindly trust technical analysis. You should treat it as a kind of auxiliary tool, which shows with a certain probability the further price movement (but you should always lay a straw).

[Assface16678]

From what I have read from your post, it's about the psychological mindset that is set on the "market psychology" not with your personal or self mind when it comes to disciplining and managing your assets/resources. Mindset is one of the things that you would consider if you ever are interested in being successful in trading.

So you need to understand both stances.

• Market Psychology
• Self Psychology

I think there are more technical terms but I can't think of it right now. You really need just to understand how the market would lean or go to and with the self psychology, it would be the controlling of your emotions.

It plays with the technical analysis. It has roles that you need to consider as well.

Market Psychology: What is the way to understand it? Or market psychology can be understood through technical analysis.

In fact I have been lagging behind for the past six months. Trying to understand know it is not possible to learn or master it in such a short time. But of course I need a better way.

The answer is no. Let's put it this way: even experienced and expert traders are still having a hard time doing TA or technical analysis because the market is volatile, so they need a series of analyses and also adding more indicators to the market analysis, and they need to take into consideration the recent movements of a certain currency. In short, doing or coming up with a technical analysis will not be easy either, so you need very consistent learning and also a lot of patience because that's where you will be challenged and may give up through it. But if you are a constant learner, then I think you will come up with a TA that has the potential to earn, but remember that every technical analysis has its margin of error, so your TA should be able to cover that margin of mistakes. Well, anyway, there's no perfect trade; it's up to the trader to decide how good he is or how good his decision-making is.