Not a review as:

  1. I haven't finished the book yet
  2. I can't do it justice
  3. In the sceptical spirit it encourages, I'm seeking contrary views

This post then describes why I'm finding a particular TA book useful, in case anyone else might find it, the free course or podcast useful too. Be warned that if you think you have a working system you might find the material challenges your current perceptions. If this makes you uncomfortable, quickly move on.

This year I've spent some time investigating technical strategies with the goal of finessing entry and exit. I've been trying to develop a breakout strategy and managed to lose money slowly (~150 trades with an overall 1.5% loss - so at least discipline and money management worked). During the same time period my (mostly neglected) joke Fantasy portfolio, which initially held near the maximum amount of cash allowed, went up 19%. A useful experience, this points the way forward for me (technical investigations off-line, while mainly pursuing a NAPS like system in real life).

During the year I'd sought evidence for, amongst other things, common moving averages strategies, pattern strategies and % based stops. Back testing, while it may have its flaws, can tell you what hasn't worked recently. I didn't find much evidence to support the more common assertions, but I did enjoy the programming challenges!

I did come to the conclusion (after thinking about them since reading Bulkowskis Encyclopedia in 2000 and revisiting updates this year) that all patterns were just variants on a theme; consolidations by any other name, they represent a loss of momentum and a potential change of direction. With no need to classify them as Table Top, Batman or 'Paint-pot Leaking' they can be analysed with far less effort. Moving averages, as popularly promoted (crossovers, order, slope etc..), don't work for me (I've still a few ideas to test, now focusing on distance from the average and direction). Others may have evidence that these popular strategies work. If so what else do you use them with? With stops I need to think this through further but my direction is towards volatility based.

During the year a popular thread came to my attention. This was demonstrating a methodology called 'Wyckoff' and is worth reviewing if you've managed to ignore it. After 30+ years investing on and off, I…

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