Quote:
Originally Posted by knightofdelta
Ok, I understand your skepticism about technical analysis. I am a core fundamentalist but there are times when you just have to open your mind to some things. Just because you don't understand a concept does not mean it is not simple and just because one or two people have rubbished it does not mean it does not work. I never for once claimed that technical analysis is superior to fundamentals but the truth of the matter is that they go hand in hand.
You cannot use TA to accurately predict the future but you can use use the trend of the past to determine what is going on at the moment. Even you have used TA without knowing it. You were able to buy Oceanic at a low price, why did you wait? Why didn't you buy at around N8? Even at N11 it is undervalued. That wait is a form of technical analysis.
I have been hit by the market and I have decided to make my money back from this same market. I decided to add TA to my arsenal and I have used it several times since late January. And for your information, I have made over 20% returns within that period using TA.
I bought FCMB at N3.40 and sold at N4.35. I bought First Bank at N13.70 and sold at N18.22. I bought IEI at N1.18 and sold at N1.43. I bought Redstar at N2 and I am still in. I bought Flourmills at N11.10 and I am selling tomorrow. This is full disclosure... I have not lost a single kobo so far.
When I buy the next stock, I will let you know. I have my eyes on Bagco and ETI. And I am using TA.
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Its not as if I dont understand technicals, its the ever changing dynamism of the whole thing which will tend to render one system obsolete that tasks my patience. I have leant lots of charting patterns, the candlesticks, etc and have come to regard them as waste of time since they cannot tell me what will happen tomorrow.
What we think will happen tomorrow may change because of changes in the traders buying appetite and till I see trading softwares that can measure investor behaviour before they take action, I will maintain my scepticism.
I dont think TA is simple, something that will make me gaze at my computer for hours crosschecking patterns is def not simple, I like it when I look at the price list and it tells me the whole story.
I was nearly wiped out by the market crash but I am recovering, sold fast before I could take more loss. Not as if I doubt your ability to generate those profits because I was also into FCMB at N3.56, didnt sell and am waiting to buy more around 3.50. I also bought Uhomes at 1.80 and am buying more if it goes below 1.80, but I can handle them on my own without looking at charts, just the pricelist and am okay.