here ya go fm, page-22

TA "has not been proven scientifically"

Rager, I must admit to a chuckle on reading that ... Look, Harlee is dead set right, in that "a little knowledge is dangerous" ... that includes all of us when we start out doing something. Its only after many years of doing something, that we realize how little we knew when we first started.

You see so many charts that feature weird & wonderful lines & patterns that in the end confuse rather than enlighten. I dont follow those theories at all.

The basis of genuine technical analysis is actually just mathematics, and is in fact VERY much scientifically proved. I am sure that you use TA every time you buy a share ... WITHOUT EVEN REALISING IT!!!
Do you check the DEPTH of buyers & sellers? = That's TA
Do you check the VOLUME of sales? = That's TA
Do you check any recent price movement? = That's TA
Do you check to see if brokers are recommending the stock, indicating positive sentiment = That's TA

I like to do all of the above too ... but I find it easy to check all the above INSTANTLY on pre-setup candle charts. So let's assume we get wind of an interesting stock - we read up on the fundamental analysis and now know what it OUGHT to be doing (as Nightstalker brilliantly put it) .... But we need to check what it is doing NOW!! So we check TA via looking at a chart. A well setup live candle chart instantly gives us depth, volume, recent volume, recent price movement, indicates liquidity, and gives good indication of market sentiment toward the stock, AND essentially gives us clear signals from all of this as to whether it is worth buying or not.

The same is true when we come to selling a stock. A quick check of the chart shows a clear support level for the stock, so we can initially put a stop level in place. Then when we are in profit & thinking about selling, using TA will help us maximise our profits by alerting us to changes of sentiment ... this is nothing to do with predictions or reading tea leaves. TA just tells you in a visual chart form what is happening to that stock NOW ... eg: a drop in volume, dip in SP, a break down of buyer sentiment - all can easily be discerned by checking the volume & candles of the last few days.

I honestly cant see how anyone can profitably trade the markets without TA as a tool to assist them! And as I said, even those who laugh at TA and say its nonsense, actualy use TA ... only in another form.

:)

PS ... I dont want to totally dismiss the "predictive" nature of chart PATTERNS. These are generally based on historic precedence and can be quite powerful if confirmed. For example the DOJI has specific criteria, that when fulfilled can clearly reveal the trading sentiment in that stock at that time, and via the closing action will often give strong indications of what that stock will do the next day. There are many other examples .... wisdom says that it would be worthwhile to investigate the value of learning these!!