Technical Analysis Tutorial: The Basics

In this video, Stuart McPhee shares his simple yet profoundly effective technical analysis rules. He says that now he is trading medium-term. He had peaks and downs during a three month period that he takes as example. How critical is the timing of this entry? It is not critical at all. If you identify the three peaks and two or three days of drops. Someone could say that one is a previous peak and there must be a continuation of the up-trend and must go to another high peak. Someone could say that when he sees two or three days with an up continuous trend then he is convinced that this is going to go higher.

Stuart McPhee, personally, would wait to arrive to a much higher point to say that is going to go up higher. In most of his trades, within a week he is actually down. He does not care about this. In short, technical analysis is the study of prices and volume, for forecasting of future stock price or financial price movements. Technical analysis does not result in absolute predictions about the future. Instead, technical analysis can help investors anticipate what is "likely" to happen to prices over time.

So Stuart McPhee says that timing is not that critical. The relevance of timing and how critical it is for short-term trading is how much time it takes to go from a down point to a peak point. So timing is absolutely critical. Before, he thought timing was important, critical, timing is everything, but when he adopted a medium-term approach he realised that is not really that important.

Stuart McPhee quotes from this video:

  • In most of my trades, within a week I am actually down
Submitted by YouTube Trader on Fri, 04/09/2010 - 20:59

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