Unpopular opinion: I think technical analysis works, to the extent that it works, because a lot of market participants believe in it. This belief turns it into a self-fulfilling prophecy. I’m not trying to criticize professionals in the technical analysis field, and I am neither for nor against technical analysis.
But it seems to me that while the market reflects the true value of an asset (fundamental analysis) in the long run, short- to medium-term movements are influenced by other factors, like psychology (behavioral finance) and technical analysis itself.
As practical investors, I believe we need to consider all these elements—whether they are the result of self-fulfilling prophecies or not.
Reminds me of David Aronson's book where he debunked many Technical Analysis themes. While well intentioned and certainly accurate (for the most part) it is not how successful traders use indicators.
"Technical Analysis Breaks Even" .... Yours Truly.
Unpopular opinion: I think technical analysis works, to the extent that it works, because a lot of market participants believe in it. This belief turns it into a self-fulfilling prophecy. I’m not trying to criticize professionals in the technical analysis field, and I am neither for nor against technical analysis.
But it seems to me that while the market reflects the true value of an asset (fundamental analysis) in the long run, short- to medium-term movements are influenced by other factors, like psychology (behavioral finance) and technical analysis itself.
As practical investors, I believe we need to consider all these elements—whether they are the result of self-fulfilling prophecies or not.
Reminds me of David Aronson's book where he debunked many Technical Analysis themes. While well intentioned and certainly accurate (for the most part) it is not how successful traders use indicators.
https://evidencebasedta.com/
I have the book, but haven't read it. It was probably written by a non trader, same with many academic articles