I typically laugh out loud when I hear a pundit refer to technical analysis
as voodoo. Am I offended because it's one of the tools in my approach?
Certainly not.
I really could not be bothered, as long as I am on the right side of the market.
If I didn't use TA, there's no way that I could be consistently profitable
in a market such as this. When you think about it - broadly speaking, the
way I approach technical or relationship analysis is no different than the
fundamental guys philosophy. We both contrast current data to past performance
to make an estimation about future expectations.
It's just in this circumstance their PEG Ratio is my U.S Treasury/Equity Ratio
- and in my experience I can't predict with any probability where the market
will trade next week, month or year based on PEG ratio's.
Maybe it's just me.
Judging by this chart, we are very close to a short-term low - which will
likely be SPX 1125-1135 over the course of the next several sessions.
With that said, have a wonderful and warm Thanksgiving for those American's
here and abroad.
For everyone else, stay frosty - this market is very dangerous.
Although I am an active trader, I have always taken a broad perspective when
approaching the markets. I respect the Big Picture and attempt to place each
piece of information within its appropriate context and timeframe. I have found
that without this approach, there is very little understanding of ones expectations
in the market and an endless potential for risk.
I am not a stock picker - but trade the broader market itself in varying timeframes.
I want to know which way the prevailing wind is blowing, where the doldrums
can be expected and where the shoals will likely rise. I will not claim to
know which vessel is the fastest or most comfortable for passage - but I can
read the charts and know the risks.
I am not a salesperson for the market and its many wares. I observe it, contextualize
its moving parts - both visible and discrete - and interpret.
I practice Market Anthropology - Welcome to my notes.
Erik Swarts is not a registered investment advisor. Under no circumstances
should any content be used or interpreted as a recommendation for any investment,
trade or approach to the markets. Trading and investing can be hazardous to
your wealth. Any investment decisions must in all cases be made by the reader
or by his or her registered investment advisor. This is strictly for educational
and informational purposes only. All opinions expressed by Mr. Swarts are subject
to change without notice, and the reader should always obtain current information
and perform their own due diligence before making any investment or trading
decision.
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