Why technical 'analysis' is garbage (explained by a quant developer)

[@CodingJesus]

Do you guys practice Stock Astrology? If so, let me know why down below!

[@fdhadi]

no, I gamble in stock. I place my bets. based on gossips & rumors. tbh I win most of the time, and I let all my market experience out the window. because it is useless to predict it. the truth is ( the market is based on panics and news NOT pattern readings). that's how I work. and it works for me.

[@archjc8873]

do you sell ea?

[@abdullahaleiti8024]

Please have a look at "Technical Analysis Of The Financial Markets" by John Murphy. He neatly answers all common arguments people say against technical analysis.

[@teebuffet8393]

I really don't use technical indicators that much, I think that looking at macroeconomics, current government policy and stats including company fundamentals in the long term have a better chance a success

[@destiny_1on196]

So what do you say we should do then

[@TheRealDyscyples]

I used to think this way, but discovered quickly that I was very wrong. One of the reasons technical analysis works is because people use technical analysis.

[@borntodoit8744]

This "coding Jesus"...is so full of sh*t Just because he hasn't been taught how to trade he believes you can't trade. Anyone can predict the future. With two data points on a straight line trend YOU CAN PREDUCT A THIRD POINT BY EXTRAPOLATION THAT IS LITERALLY PREDICTING A FUTURE PRICE FROM.CURRENT PRICE Experimental results proove it again & again. I can predict the next 1min, next 5mins, 5hrs, 5days, even 5months into the future with 100% confidence ! Treat the market like a black box. It has a regular behaviour...while this Jesus can't explain reality of narjets...he fails other people have successfully modelled price (trend line is a visual model that works). Fckin academics can't do what my 8year old can do...he can trade using simple black box model I give him. It's all about whether you have the right understanding of the markets...THIS JESUS obviously doesn't hence he can't trade. (& Yes I make money from trading the trend, scalping, day trading, swing & position trading)

[@carlhopkinson]

Exactly. Short and Sweet explanation.

[@donleonardestrera6092]

@@borntodoit8744 Thank you for speaking up.

[@bellswhistles-2083]

Never thought about it this way 🤣, but as the dude in the video said, traders would look at the charts differently !

[@MajaroReal]

He starts saying that TA doesn't work because price movement is random, but price movement is literally not random, there are people behind every sell and buy and the future actions of people can be predicted (with various degrees of succes). Its chaotic and you dont control every single bit of information, but you can analyse previous movements and act acordingly. He also says TA people only use 1 indicator??? Thats a clear indicator that he himself does TA wrong as he doesnt understand or know how it's made. The patterns trend analist recognice are not patterns you use in society or evolution or even something you see with your eyes, you have to learn to use them and mean very especific thing, its not monkey brain sees monkey brain does. If you are day trading you don't really care about the long term price of the asset (even though you keep it in mind), what's going to make you money is buying at the lowest point and selling at the highest, and you identify those points with TA.

[@noimnotnice]

"X is random, hence one cannot predict X." This is just categorically wrong, in every aspect. It's what one would expect to hear from somebody who has never seen a distribution function. The weather is random. Y(x)=ax+N, where N is random, normal-distributed noise, is random. A football match played between a professional A-league team and its fan club is random. The number of lottery winners for any given year is random. The introduction of randomness into a system does not render the system entirely opaque to analysis. You ought to know better than to utter such silliness.

[@DavidSoda]

It probably be because his background in CS and not in something like physics or engineering. Markets being 100% random is somewhere between complete bs and a hardly debated topic. And this has been studied too: Mandelbrot, volatility clustering in the markets (can be accomodated in models but clearly not a brownian motion), etc. But beyond that you even have papers finding chaos in the markets which woud imply, for the least, some degree (potentially variable in time) of determinism in them. And then you ended up in the discussion of non markovian, path dependant systems and so on which sound promising but afaik it is mostly uncharted territory for now. Nothing of this has anything to do with technical analysis though but it was indeed lazy thinking.

[@Xerus35]

You are wrong. Price may not be truly random, but price is totally dependent on anticipated future price, which is impossible to know without fundamental analysis. There is absolutely no predictive power in past prices and so technical analysis cannot work. This is why nobody including you makes money from technical analysis outside of luck with a small sample size. This is why technical analysis guys constantly need new strategies. All they are really doing is backtesting different strategies until one of the strategies has a lucky run and then the analyst calls that a working strategy and uses it until the luck runs out. It's pure gambling. It's no different to betting on red because you saw 5 reds in a row.

[@DavidSoda]

@@Xerus35you have to understand first that randomness and memoryless (actually called Markovian property in maths but whatever) are linked properties and therefore all you saying is already within the EMH paradigm and being discussed here. Nonetheless you're not presenting arguments your "may not be truly random" means basically nothing same with your "lucky runs", all these should be defined mathematically before them being valid arguments. Anyways this is not about opinions, we were discussing mathematical paradigms and models here

[@Xerus35]

​@@DavidSoda What I said isn't an opinion. When I say "may not be truly random", what I am saying is it's pseudo random, where the price is a function of a variable set, but that function is so complex and has so many unknowns that it's not possible to predict from price action. When I say 'may', I'm not saying I do or do not know, I'm admitting that it is not true randomness.. When I say 'lucky runs', I am saying people backtest models until they find one through survivorship bias. The equivalent of flipping a coin 10 times and if it doesn't flip heads 60% of the time then they try another coin, and they keep trying coins until they get 60% heads and then select that coin with the assumption that it has a bias towards flipping heads, which it obviously does not. That's why there has never been a single model based on technical analysis that exists that works persistently. If there was one, the owner of it would have taken everyone's money.

[@DavidSoda]

@@Xerus35 the issue with this logic is that you're assuming ideas from the EMH paradigm that require the markets to be random (like prices only discount the future while always perfectly reflecting all info of the past) but then admittedly you don't think markets are truly random. This is really contradictory though as for all these ideas to hold from first principles markets HAVE TO BE RANDOM ! In my view I agree with you in markets not being fully random, and that's why I see "prices only look forward" or "there is absolutely 0 predictive power on past prices ever, regardless of any other condition" as clearly not the full picture and just a simplification given by the efficient market hypothesis in this case.

[@High_Priest_Jonko]

While a certain amount of randomness does exist, it's unrealistic to believe that ALL price movement is random. You can verify that empirically. And logically if prices are random and unpredictable how can trends exist? How can bull and bear markets exist if trends don't exist?

[@axe863]

EMH is a strong justification for low predictability in the log return space.

[@CScott-wh5yk]

ALL models (including quant) are based on previous data, by definition. Anyone who uses a model of any kind is essentially engaged in technical analysis, whether it be a price chart, an income statement, or current order flow.

[@abhinavgopinath5814]

The historical income and cash flow statements do not impact the price of an asset. The drivers of all financial models are predictions of the future. You have it mixed up.

[@CScott-wh5yk]

@@abhinavgopinath5814 and what inputs do you use for your predictions? Seems you have it backwards. Data first, model second, obviously.

[@abhinavgopinath5814]

@@CScott-wh5yk Management’s forward guidance and industry CAGR. Future revenue growth rates in most cases cannot be inferred by historical data especially if it is a young growth company. The only time I would use hard data from the past would be to calculate a discount rate.

[@CScott-wh5yk]

@@abhinavgopinath5814 Industry CAGR is based on past data, so you fail there. Management Guidance is informed by past data, so you fail there too. And any multiples you apply to your forward figures are also based on historical ranges… there is no escape. As humans, all future projections are based on historical models and look-back analyses.

[@abhinavgopinath5814]

@@CScott-wh5yk I would love to see you make a DCF, you seem like an expert on everything.

[@robertosoto8580]

I disagree wirh this. I am a futures trader and TA is critical for my job. If you do not understand TA, it does not mean it does not work. Actually it works but... there are things that some people, even knowing some TA, do not know about. Some people simply do not understand the markets.

[@fred6o]

0:42 so basically he give a fake definition of technical analyzis just to make a garbage video without even knowing that the point of it is to get better entry and not predicting.

[@secullenable]

He's a clown

[@paradigmshift528]

Why focus on a single indicator? I use 200 sma, rsi, macd, volume, & 20/50/100 ema. Psychological support and resistance is real. Price is not truly random in the long term.

[@utica2burn]

The deep irony is that this guy is apparently serious and hasn't understood that quant trading IS technical analysis.

[@kushalkatkar2523]

why would this guy be on you tube asking people the pay him to subscribe if you can earn so much. Wouldn't he be busy doing the stuff that gives you so much money.he just sound like a noob who has read a little bout coding and quants and just blabbers.

[@kushalkatkar2523]

And he look poor for all the Supposedly great knowledge he has

[@kushalkatkar2523]

I think he always gets stopped out, noob.

[@RapCityco]

@@kushalkatkar2523 how much have you made from trading?

[@MrPushupp]

@@RapCityco lmao 🤣

[@ysbys]

am not trader but i can say In technical analysis, you are taught certain strategies, but many people doing the same thing may create a volume spike, and algorithms might end up taking your money."

[@ThreeLeftOverCrest]

1:10 if prices are indeed random, then there's no edge you can possibly have, whatever other data you're using as a quant would be equally as worthless

[@robertschwenkler8105]

Adding on that… if prices were completely random, then anybody who participated in the market would, over time always end up at breakeven. This is clearly not true in the real world. Interesting video, but it falls extremely flat, and neither does he present any evidence to support his case, beyond one hyper-specific scenario. He said he’d prove his opening statement, but he didn’t.

[@user-fk3do1fe8q]

@@robertschwenkler8105 true. At least quote some statical maths and prove his points like a REAL* Quant Trader.

[@friend2194]

​​@@robertschwenkler8105you seems to mistake price appreciation with yield, which also includes dividend. Also there are economic reason behind upward bias of the market. Still the guy has complete faith in random walk theory and market efficient hypothesis, which is just the same as blind faith of the ta crowd lol

[@arashsheikh65]

I don't know what your background is so I don't know how rigorous of a rebuttal you need to see but prices being random does not mean that you don't know anything about them. Even a gaussian random process still has a mean and variance. There are different classes of randomness and you can indeed have an edge if you understand the underlying processes and have a deep grasp of statistics or stochastic differential equations. What you mistakenly assume is that random means uniformly random where every prrice is equally possible. That indeed is not the case.

[@ThreeLeftOverCrest]

@@arashsheikh65 my background is CS and Ive been trading for a couple years now. The principle is still the same. What he said is, theres nothing you can look at historically that will give you an indication of whats going to happen in the future, because prices are random and randomness cannot be predicted (or it is not random). The idea behind trading (quant, discrete, etc) is to be able to profit from the difference in price between your entry and exit, regardless of the complexity of the methods you might use or the instruments you might trade, you still rely on something (indicators, models, less complex, more complex, etc) to know when and how to execute a trade. The methods you mentioned still use historical data, they would be still disqualified by our boy jesus.

[@christsciple]

I don't know what kind of experience you have as a quant, but you really couldn't be further from the truth. Just some background for you, I've been working as a quant for nearly a decade and have experience across a broad swath of Wall Street banks and boutiques. Furthermore, I currently run a consulting firm. Many others have already stated many truths, but on top of that, tech analysis is used as part of a stack for advisors, traders, and analysts. That stack is comprised of chart reading, fundamentals, and all the fun quanty stuff that's involved with designing, backtesting, and possibly implementing of specific algos. It's not a perfect science with respect to accuracy and linear predictability, then again, no system is. If you were worth your salt in your field you would already know this. Technical Analysis is an entirely separate field from HFT, especially if you have worked at a prop firm, this is common sense. I really hope that if anyone is to gain anything from this video, it's that you have no actual idea what you're talking about and you're not worth a subscription nor additional views for spreading misinformation. Literally every major bank and firm I've worked at leverages TA to some degree for various reasons.

[@Vlad-ke4ge]

Exactly, on another video I cant remember exactly but I'm sure he said he worked at a firm for a year as a quant, now he thinks he knows everything

[@chidianyanwu889]

Ummm sir, start your own KZbin channel. I’ve already subscribed to u. Make videos pls 😂. Would love to learn more from u 💯

[@W1LdnKai]

Even the largest hedge funds have a better return from long term holding then they do with their complex algorithms and bots etc.. they only continue use them because it's what customers like to see

[@123-f6j8h]

🤣🤣🤣

[@prashanthb6521]

Even I came to the same conclusion, he doesnt have much experience with the daily grind the market puts a trader thru and the learning it offers.

[@andresvallelisboa5511]

09:00 the head and shoulders pattern is a pattern that indicates a potential reversal zone, that does not mean that the price will necesary change its direction, it is usually used as a filter to avoid trading in those situations.

[@adnantamimi7026]

The kind of technical analysis which does work to a certain extent and is used by hedge funds and asset management firms is completely different from what retail traders do. One of popular class of methods is statistical arbitrage. A lot of asset management companies use price volume data to mine alphas and feed them to machine learning models which in turn generate signals for trade. These are the methods which work (but not 100% of the time of course) so far as "technical analysis" is concerned. All other stuff that retail traders do is considered a joke in academia. But that doesn't mean it will never work. If a lot of people are following the same method/signal to trade, regardless of whether it makes sense or not, some will surely make some profit at some times.

[@DJHypnovibe]

I've been using alphas based on sentiment

[@ChrisosIDK]

That is exactly what I do as a retail trading quant. Find statistical alphas using TA indicators, code bots to take advantages of them. Profit.

[@robertmazurowski5974]

If you do not understand something doesn't mean it doesn't work. Technicals and fundamentals are different things, they are part of a whole. Best traders don't only look at a chart only but they study the sentiment, news, fundamentals, psychology of the market, indicators, long term market regime and then the chart. This cannot be quantified. It is so easy to create a MACD based algo strategy that makes money, once you understand how the markets work, the risk and randomness of the markets. Prices cannot be predicted but you can control your bets and position sizes. Patterns exist, the market is so full of trading algos right now that they often repeat patterns in the market, when they apear they can be traded for a short period of time.

[@unfilteredminds-zd4ig]

there are not many good traders. You don't know what a good trader does. You are just pretending, the same as every other commenter.

[@kiwizor9962]

how much % have you made over the last 5 years lollll

[@robertmazurowski5974]

@@kiwizor9962 I don't trade, but I know poeple who made a lot of money trading, using Technical analysis. What the guy above does not understand that nobody makes trades based on technical analysis. Technical analysis is only for entries. Deciding whether to trade or not to trade takes big knowledge of the market.

[@codingandstuffs]

@@robertmazurowski5974if you don't trade you have no business dropping this comment lmfao

[@Xerus35]

@@robertmazurowski5974 They are lying to you. Nobody has ever made a penny off technical analysis outside of luck because it doesn't work. Markets literally could not exist if techincal analysis worked.

[@tomyao7884]

The most important counterexample to your position is the performance of james simons' medallion fund. But I agree that most retail traders should not be trying to use technical analysis to try to beat actual quant funds at their own game. In fact, if people stopped trading stocks at all and just bought and held the index, even the medallion fund wouldn't be able to make money.

[@sanguinor5609]

The medallion fund was built upon quantitative and mathematical models incorporating vast amounts of data sets not technical analysis.

[@Dan-uf2vh]

After a lot more experience, I would say that today the main reason technical analysis doesn't work is that it is too accessible and the only thing to come of it for the average guy will be paying commissions, at the best, and losing even more at worst. Meanwhile, quant trading is technical analysis but it does any technical parameter that hasn't even been conceived of and seeks to optimize. There is no way for a human to compete with that, especially on a daily basis. Long term you could argue that markets have a tendency to go up, so just going for more volatile elements might make the more money. That's all you as a human could do.

[@arashsheikh65]

You think mathematicians trade on technicals? 🤣🤡

[@Eurodollartrader]

@@Dan-uf2vh Stop spamming this same post fucker

[@kayunrtd3514]

What data sets are those?😅​@@sanguinor5609

[@MFM90786]

This guy ain’t got a clue what he’s talking about. He wants us to die for his sins.

[@drippinwet774]

He's riding on the controversy. They can be *forecasted* screw this guy for not going into risk simulation & random chance. Don't let him pull your guys' leg

[@kodiakgriz2296]

@@drippinwet774 guess TSLA never on his radar with those T-Rex DCF projections..lol He learned coding in 3 months and he is Steve Cohen

[@victoriacarmazan1951]

Die for his sins 🤣🤣🤣 I like this expression. Will borrow it from you 😂

[@80amnesia]

totally agree

[@qx-jd9mh]

@@drippinwet774 Anything can be forecasted. It doesn't mean your forecast and risk models have any power in the real world.

[@wesleyh7945]

My lazy ass would love a video where you go over the empirical evidence.

[@ydh1997]

Underrated comment.

[@CodingJesus]

If you weren’t so lazy you’d see studies I’ve referenced in the description of this video.

[@ramsesp5009]

​@@CodingJesus When you say "TA is garbage" you need to clarify exactly what you mean. If you mean candlesticks & Indicators correlations, sure i agree. But if you mean Price action & short term momentum plays, i'm betting you 10k & willing to trade futures live in front of everyone to call you on your bullshit. We all know prices are random. That sole purpose of TA, at least for me, is to bet on the odds a particular system will work if i do it thousands of times, which has been obviously forward tested before hand. Essentially, you're trying to be the casino, if there's enough edge in whatever method you're executing, especially during unstable instances (Gap down, News catalysts) But on the other hand, i have to agree with you, on the fact that most courses out there are absolute garbage. Always looking for shortcuts in life, with those "Holy grail" indicators, nonsense.

[@aleksandarpesic1412]

@@ramsesp5009 100% agree. A very small part of technical analysis works better than random

[@JP-wq6sb]

Great video. I was surprised to read that the NY Fed did a study re: head & shouldersn and determined that they determine direction about 50% of the time (coin toss). Sullivan, Timmerman & White did a very extensive study of TA and determined that TA offers no long term or results (profitability). A 7 year old can learn how to read a chart, but the real stat (imo) is that 98% of traders are not profitable and probably 99% of them rely on charts. Only proof in the form of P&L could cause me to think otherwise.

[@veramonique1724]

Let’s not forget that the biggest payouts in the markets don’t come from great performances but rather it’s great promotions. Stay invested, diversification for streams of incomes is very important

[@veramonique1724]

Leaving it in investments rather than my bank accounts is one decision I’ll never regret, over the years I’ve accumulated tons of wealth from proper investments in Bitcoin, non-fungible tokens (NFTs) and stocks. Currently I plan on maximizing my gains and growing my portfolio even bigger

[@paulharold6721]

Be it a crash or rise the financial markets will always have lucrative means for folks to earn decent payouts. I’m just being inquisitive? how are you yielding gains

[@devdaniel3225]

I’ll take investments in stocks any day they’re very remunerative only problem I’m having is I really don’t know how to go about it, I do get lost and overwhelmed by the markets. any solid pointers would be helpful, I’d appreciate if I got a reply

[@veramonique1724]

In general knowledge without experience, in the markets indeed can become very inundating, since the pandemic till today I don’t rely on full time jobs for money cause my expert Vivian Klaine Morgan actually pay off and I’m passively earning incomes. system has kept my portfolio elevated and healthy.

[@devdaniel3225]

How do I reach her ,you got any possible means of getting more info on her services?

[@savanthuman8809]

technical analysis is not used to predict the future, but to read the present market.

[@BuscandoYEvitando]

And why do you want to understand the present market. Could it be to make bets on what the future will look like?

[@fakeasfluff6842]

@@BuscandoYEvitando its just psychological game. if you're feeling fucked in the butt, others will probably be feeling the same. that is just in the short term though. The long term, who the hell knows, I just invest in boomer stonk

[@KrishnaGain]

Human psychology also

[@splint3048]

It can provide some clue as to how far price may move up or down by use of support and resistance, or that it may indicate a new trend is forming if the price is breaking out of a trading range with good volume. It is pretty hit and miss though. A lot of pump and dump scams can create false signals. TA will provide only the slightest advantage if any at all but I think whatever your approach, the most important thing to know is that around 95% of people who start trading will steadily loose money to the point they either financially or emotionally cannot continue trading. My advice is if you must trade, get as much historical data as you can and do simulate trading and see how well you went. If you were profitable in simulated trading you may have some hope of being profitable in real trading.

[@priceactionsetups9057]

@@BuscandoYEvitando Do tennis players read the future every time they successfully connect their racquet the ball :)

[@90deltaderivatives35]

This guy is extremely ignorant, tell that to all of the consistently profitable traders that use patterns constantly, including me. Of course we use multiple forms of confirmation but to think you need to focus on some “investing” thesis is just plain stupid.

[@davidduries9112]

totally agree with you.

[@MrAlb3rtazzo]

he got zero clues about basic statistics and very basic undergrad quantitative finanace.

[@90deltaderivatives35]

@@MrAlb3rtazzo that’s what I was thinking. So many people want to put others on a pedestal just because they say they work for someone reputable or because they have a lot of views on KZbin & then they equate that with how much one should believe that individual or not. Technical analysis 1000% works, & unfortunately this dude just convinced a shitload of people who don’t think for themselves into thinking technical analysis is irrelevant because HE doesn’t know how to apply it, which is fine because it’s his opinion, but he should clarify he has zero clue what he’s talking about. 💔 Cheers.

[@90deltaderivatives35]

@@davidduries9112 🙏🏽

[@MrAlb3rtazzo]

@@90deltaderivatives35 regardless of what he said on TA, what he is telling people or replied on comments is full of basic math mistakes, i really think that either he works as something else, or is the worst quant in the world.

[@jaywhoisit4863]

When there are thousands of people involved there is most definitely a trend! TA is basically learning what the pack is about to do. TA works really well if you can see patterns in creature habits. The reason we have resistance and support lines is because we have thousands of people thinking the same thing and drawing their lines on the same chart. Sorry bro but I used to think like you! It’s not about price at all. It’s about human nature.

[@oentrepreneur]

So how much money have you made from technical analysis? Do you really believe you can turn $1000 into $1 million with day trading?

[@biyodahi]

@@oentrepreneur yep

[@venkatavineel]

@@biyodahi where do i get started, any groups you know?

[@oentrepreneur]

@biyodahi lmao,two years later,you couldn't make a million dollars from technical analysis. And you still believe in it? You're delusional, and you'll continue to lose money.

[@oentrepreneur]

@biyodahi two years later you couldn't turn $1000 into $1 million and you still believe you can become a million with technical analysis? Lmao

[@fuu812]

"Quant Lead" gives me "Tech Lead" vibes, shivers

[@bennigan88]

omg I get the same vibes! (as a millionaire)

[@retrogaminghd3300]

This might be a very different comment from the vid. But i study economics, and trade. Once a person understands how to relate macroeconomic concepts like FDI, CRR , SLR , GDP and study the budget of the government then trades in stocks that are affected by government decisions. Such as banks , real estate and other sectors like defence, one can make good predictions. Example , if a government is trying to help a certain sector , pouring in money and developing it , it's easy to just park the money in the index or pick a few top dogs. Yes mathematics makes perfect sense but the numbers are generated by Economic movements , so if you just know why and what moved, you make money irrespective of moving averages and bla bla.

[@MARKCRASTO]

Markerts are predictive leading indicators. Economic reports are lagging indicators. Markets look foward and try to price in future movement. Furthermore Economic activity too ebs and flows in trends called business cycles, that occur due to boom and busts led by human desires of greed and fear . So Why would u assume these trends woulf exist in capital markets?

[@arjunisme]

Maybe you haven't looked hard enough or your definition of technical analysis is different.. For me TA is to be able to find a risk defined entry point that gives me twice the reward and has a strike rate of 5/6 on 10...it's good enough to build a career.. It's a lot of work but it possible.. And yes pattern recognition helps.. Doesn't work everytime.. But it doesn't have to. Just enough so you're striking 5 on 10... Took me 4 years to figure out a system... But it works now....week after week.. Same boring process but effective.. Just manage risk, that's the only thing we can control. Trade outcome is random.

[@jessymwepele9486]

Maybe you can share please ?

[@OfficialGoldenboy]

We should create a group session? Inbox me

[@bignastytiger4174]

Very well said

[@gabriela.3276]

I love the fact that you talk about risk management and steady growth

[@Moedow]

“For me TA means - Doesn’t explain TA. Trade outcome is random, but not the exit”… Literally the same 2 things.

[@m4ryou5h]

These kind of videos help me to keep my price action trading edge forever. Thank you. I love them people who didn’t put enough work in technical analysis try to convince others that TA doesn’t work. Just because you didn’t manage to make it work, it doesn’t mean that it doesn’t work. Anyway, you do you, I will keep using my garbage TA :-)

[@boogaloobomber9889]

And he even has the audacity to claim that he "knows the truth". What a poor, ignorant men he is...

[@angelbenitez8035]

I agree w you. VPA (Volume Price Action) has given me an edge like no other. I respect this guy’s opinion, but I do not think technical analysis is worthless

[@JayTakeProfits]

Big facts. Let’s keep making our TA money 💰😎💰 With TA you have to have discipline in following your set of rules. You’ll develop an edge and just stick with it no matter how boring it gets.

[@SuperlativeCG]

For real! This guy gives off a vibe of arrogant naivety.

[@alvinmugambi6084]

He's a textbook trader.. just some nerd that listened to the lecturer and believes it's the word of God.. this is why formal education is such garbage😂😂😂

[@w7x742]

one of the rawest and most enlighting youtube video I've seen this years (see decade). Thanks !

[@magicsaint]

By calling the entire TA garbage just to prove a point about scammers selling it is ignorant. TA is simply a statistical tool (MATH) to get odds in your favor. Any good TAnalyst will tell you that it is no holy grail. TA also respects the random walk theory and also any other theories out there. TA is not just about historical price movements to predict future movements, pattern recognition, etc like this guy claiming. It is understanding what other investors/traders are also doing currently. It is also a measurement of exuberance, fear, and greed in the market. There is a reason why this guy is a KZbinr(no different than others selling TA services) and successful traders are simply traders. Skilled traders do not need any services; these services are made for the lazy ones. Think! TA works, Quant works, Fundamental works, Buy-n-hold works, etc. You will find everyone in a different school of thought that has been successful based on their individual personality and lifestyle. Do not be ignorant like this guy.

[@paduraruovidiu201]

I agree, he is really talking shit :))

[@panamahub]

he's not even mentioning probability.

[@ThaRealiestJEDI]

Did you ever calculate odds to smth happen based on TA indicator? If you claim that's just statistical tool, did you prove it anyhow?

[@magicsaint]

@@ThaRealiestJEDI can you repeat this question in proper English so I can respond appropriately?

[@ThaRealiestJEDI]

@@magicsaint yes sure. Did you prove that any technical analysis indicator is statistically significant in terms of price predictions?

[@KungFuChess]

Agree TA can't predict future prices however it can be used effectively to manage trade positions.

[@treyquattro]

only because a bunch of other people and algos believe the same things. Historical data is almost useless outside of fundamental and macro contexts. If something behaves in a particular way because of a chart indication, it's because someone has sold that indication as a reliable signal to all the other chartists

[@tradehut2782]

@@treyquattro don't speak of things you don't fully understand

[@treyquattro]

@@tradehut2782 stay in your lane, in your hut

[@WillyWooly]

@@treyquattro Then you are just saying it works then according to you because everyone follows etc.

[@thomasj7506]

Trey is actually right but again isn't that what price is? Whatever anyone is willing to pay is the the price at x time. Whether the price is the fundamental price, or altered due to trading activity is irrelevant. Trading is a game, legalized gambling. Some win, some lose, prices fluctuate, and while they are certainly random, the trend is not

[@ΗλιαςΣκ]

Exactly . It goes like this and I know it from my teacher in Uni who is a trader . "If you trying to find a pattern , you will.. eventually"

[@baumann9551]

Can I ask you what his name is or where you’re from? I know a uni teacher that is a trader as well

[@richardhp77]

What I find interesting about TA, is that in the short term if everyone concludes that a stock has a particular trend (like up), then that will create buying pressure and momentum. So it's not entirely true to say that past price has no effect, because if enough people believe it does they will trade off that and it becomes a self fulfilling prophecy. Having said that, it can turn on a dime so maybe there is an element of randomness too. My hunch is that Ito calculus is a better mathematical model for price movements that something purely stochastic

[@bennya2846]

U don’t know what r saying….do u????

[@ConsciousnessExplored]

@@bennya2846 enlighten

[@LucaPizzoplus]

Isn't Ito calculus part of the stochastic differential equations field? I'm studying math now but I'm not at that point yet

[@ralphralpherson9441]

The "establishment" is moving away from strictly Gausian distribution in their calculus and starting to look at price action as a power law distribution. The Gaussian distribution assumption is 'good enough to cut the mustard' most of the time, but its most serious flaw is it underestimates risk.

[@crazydog3307]

the trick is identifying how big the dime that it turns on will be, so you can recognize it when its happening

[@utoobmann9083]

1) Work on discipline, risk management, and trade stop hunts paired with higher time frame analysis. 2) Laugh your way to the bank while watching this vid

[@akaykenan9387]

What do you mean trade stop hunts?

[@cernabonati7022]

@@akaykenan9387 I think it’s a contrarian style of buying when everyone is selling and vice versa, at the established price levels but it’s just MY OPINION

[@akaykenan9387]

@@cernabonati7022 how do you determine those price levels? Do you suggest any materials to study?

[@venkatavineel]

where do I get started.

[@dangerous_shoe_1224]

Just because you can't understand TA, doesn't mean that it doesn't work. Just because you had a bad experience, doesn't make TA useless. I think you don't truly understand the complexity of 'real' TA. And by the way, it's not about patterns, indicators, or whatsoever, it's far from those things. Real technical analysis is all about understanding the underlying asset through price action and charts. If you really dive in deep (not support and resistance, indicators, etc.) It is actually really complex and you can make lots of stories and hypothesis just by looking at the price movement. Once again, just because something didn't work out for you, doesn't mean that it is useless. And oh, it's actually.. Not.. Random.. At all.. My 2 cents.

[@jamesonalexander5410]

Unfortunately for your viewers, there is a lot of misinformation in this video, and also a lot of assumptions on your behalf about people you dont know, including a ton of generalities that are dangerous if you actually believe these things. Technical analysis is so much more than the things you mention and works for reasons you didnt even address. I was actually hoping this was going to be a good watch.

[@777jones]

Have you published your research in any finance journals? They would definitely publish your article, if you are able to write down your way of using technical analysis to predict future stock prices. If not, maybe you don’t know about the subject?

[@jamesonalexander5410]

@@777jones I haven't personally but I can point you to 100 years of statistics, research, and backtesting if you'd like. Technical analysis isn't predicting, it's mathematics, cyclic behavior and pattern recognition. I'm not talking silly shapes, but actual signatures left from high frequency trading devices, accumulation stradegys and fibonacci based harmonic levels

[@777jones]

@@jamesonalexander5410 If it can't be used for prediction (or trading), what would be the point of doing that? Hobbies, artwork?

[@jamesonalexander5410]

@@777jones absolutely can be used for trading. The market makers and HFTs leave their signature in the charts. If you identify where they are going long and short, where they are accumulating, and historical data, you'll have a better understanding of where they are going. Understanding wave structure is very useful too. Wave structure is beyond trading, it exists in nature and abides by certain rules. These things combined with position sizing give you a statistical, repeatable, and profitable edge in any market. I'm not talking your typical youtube TA. I'm talking studies from the likes of Wyckoff, Bukowski, Gartley, Carney, and Elliot wave with fibonacci. There is decades of research, backtesting and data to support it.

[@777jones]

@@jamesonalexander5410 You just finished saying it doesn't predict. You already had the right answer. Technical analysis casts a spell on people, and it is hard to break. If it does not predict anything about the future, it means it is not useful to make trading decisions. If it were, you could leverage your trades, and you soon would be a billionaire. James Simons did this, but he is smarter than you or me. He and others then deployed staff and infrastructure you will never be able to compete with in your life. At best, maybe you rolled some dice and got lucky. Hats off to you for that. I mean that with respect.

[@tjipke95]

Hey CJ, I get your points. A lot of quant trading is overfitting on past data and finding patterns in randomness. Just one question, if price is 100% random, then why can it still be statistically differentiated from a random walk? Think about the ADF test, Hurst exponent and variance ratio test. I am fairly new to the world of quant finance.

[@thomasscoville1148]

There ya go. Takedown in one move. You should have a channel, not CJ.

[@SuperBayara]

@@thomasscoville1148 ONE MOVE MATE!! lol

[@michaeljankowski4627]

ADF has low power

[@tjipke95]

@@michaeljankowski4627 Im honestly still very new to it and still wondering. It wasn't my intention to "takedown" anyone.

[@Drew_DZ]

It’s because it’s not 100% random and TA has its place in trading

[@GS-md3hr]

One thing you'll see alot with TA "analysts" is saying things like "it needs to break through resistance to go higher" or "it if breaks support here it will go lower". In other words "it might go up or down" and there's no scenario where they are wrong.

[@Happymz]

Its all about picking the options with highest probability of occurring. Theres always a chance your wrong, and you meed to be able to recognize it, and exit

[@pierreclifton1865]

The point of of technical analysis to have a idea of where traders/institutions/etc believe a product is oversold or overbought. No system is fool proof. But technical analysis, with good understanding of fundamentals, a proper outlook and experience increases a trader's edge. Thank you for you post, Happy trading.

[@rainerrain9689]

Yes , while technical analysis doesn't work , but most traders use it (T/A). So me as a trader I keep my fingers on the pulse of these traders (who use TA) by watching the TA on charts to see what the masses (traders) are thinking, and I act before they do , because I know what they're thinking when they're watching their charts. Trading is psychological , put yourself in the minds of traders and know their move(buy or sell) before they even come to their own conclusion and act before they do.PS: always put your mind into what the masses are thinking /seeing while ignoring your own thoughts . Its like "ask the audience "on that game show, and you'll be right more often than not . Also , prices are random , but people aren't , humans are creatures of habit. This is the end of the lesson .

[@PositronQ]

I think you have not understood the meaning of video. Humans are not predictable, nothing is predictable if you know some statistics, both random movements, Brownians, determinists (without being conditional) or Monte Carlo properties, you can know that nothing is predictable, so if predicting something were possible then we would be millionaires, especially predicting humans.

[@djimbrong]

@@PositronQ on the contrary, people nowadays can be easily predicted just watch their socmed posting, in twitter, fb, ig, tele, wa, how they choose the goods they buy on amazon, how, when and what they click the news, how, when, why they click the YT videos. If people are not predictable why there are bunch of data science topics in internet and why a lot of companies nowadays aggressively looking for data scientists

[@gtry2303]

@@djimbrong people are looking for data scientists to mainly extract useful information that can help them generate profit to keep the company going. The End

[@gtry2303]

movements in market can be predicted not 100% , cuz no one is the algo

[@dlozza2000]

@@highpofly at least you tried

[@CJRyan716]

This was so satisfying to hear someone say it. Everyone professional financial advisor always has the same disclosure "past returns do not predict future returns" and its like everyone ignors it or doesnt believe it.

[@andreamassacci7942]

Bro I study artificial intelligente for about 3 years, I have a firm, and I can absolutely tell it does work. Even if you plug in an artificial intelligence to the chart it soon finds out the same exact pattern found from other human analyst. You are saying algo trading does not exist, this is crazy.

[@barreltitor1419]

I doubt it

[@c5quared626]

i have only been trading with charts for 2 months. i am a professional engineer, very good with graphs and numbers. TA onlywith drawing lines and triangles, gives me approximately 50% advantage over just fundamentals and actual viability research. TA is like hacking human frailty, and it FUCKING WORKS, you dont know how to do it, you are not good enough with numbers and geometry, if you think it's COMPLETELY random

[@scorch9736]

@@c5quared626 have you considered having a KZbin channel? Would definitely help the Crypto community.

[@c5quared626]

@@scorch9736 just trolling, lol actually haven't done too well in crypto, lost a bit gained back and learned a lot.

[@SpectatingSpeculator]

@@c5quared626So you're saying this comment was BS? Lol

[@mikolobabz]

I once heard Jim Simon in an interview say future prices (to some extent) can be predicted from past prices and that absolutely makes sense to me. You can't expect prices to respect every S&R level every time - else every trader will become a billionaire. But the fact that you still see prices respect these past levels many times is enough to know that TA does actually work to that degree. A simple observation of price trending along the RIGHT moving average alone shows a pattern of movement - either downward or upward. If there's such a defined pattern of movement, then I wouldn't say prices are random since you now have some degree of confidence interval.

[@Kochos]

Amen! It's all about stacking the odds for a further positive Expected Value!

[@Gindaman999]

Nah, "A simple observation" of something that already happened is vastly different to using it to predict the future (which you can't). Not saying TA is garbage, it does allow trader to perform certain strategy in order to manage risks, and helps investors understand sentiments and historical data. But TA does NOT really give retail traders any edge, real edge always comes in order flow and psychology, as studies have shown.

[@Kochos]

@@Gindaman999 yet your account is in the red

[@Gindaman999]

@@Kochos don't be silly, either you join the discussion or thinking trolling enhances your argument, it's your call, lol

[@Kochos]

@@Gindaman999 so let's say you go long when the price crosses above the MA. After 200 tests you're in net profit. This is TA working my friend. Psychology at least, leaves PATTERN marks on the chart that can be captured with TA. I take in account that you do understand that we dont need to have 100% to prove that TA works but a good enough EV

[@aliasalin2]

I never liked and understood technical analysis. Except few years ago, I had a class for risk management at university, taught by two professors that are phd in mathematics and worked in the industry for many years. I was surprised to find out that they never looked at the chart, and all the TA was done using mathematical formulas in excel and were backtested again and again using small adjustments, and those "patterns" are actually betting on statistical chances. I see your point and I agree, but you assume that the efficient market hypothesis is true, while technical analysis is created on the basis that the markets are not efficient and there is no point on in trying to understand the market since information is not accessible to everyone.

[@Ratatouille.00762]

Hi, do you mind telling me your major and what was called the class? I would loke to search info on this subject. Thanks very much 😊

[@N-xi2zh]

Probably Economics or Mathematical Finance or a Finance major. Maybe Financial Engineering...@@Ratatouille.00762 The exact class, I finished econ years ago, I have no idea what it may be called. Check out syllabuses at your fav colleges/college of choice.

[@TradingMastermind]

It is always satisfying and amusing to hear when people say this. Every day I can see the next trade and it is obvious in many cases using a form of technical analysis. (reading charts) Often people who are not able to see what is obvious and learn to trade, will say that it is not possible and that makes my work even more valuable. Best of success and happiness in this approach!

[@erictuffelmire6826]

If that were the case you would be a billionaire

[@ontraccapp]

I totally agree with you. TA works

[@laudatosiadastra1218]

I used to be pure fundamental but now pure technicals which I find much better. It filters out all the noise. I always used to wonder why stocks with ´amazing` fundamentals would take forever to do what I thought it would. By using technicals, it´s possible to find very many good setups in the strongest sectors based on the chart and volume characteristics. It´s not a science but a craft. It takes discipline and skill to master but it´s far easier to pinpoint good opportunities.

[@nepik1980]

As a trader, your statement "...prices follow a trend if you believe prices are not random, prices are indeed random." is a yes and no. Prices are indeed random, its the individuals who partake in the markets that make it "not random". We as traders look in the past to identify places where more people agreed that prices are a good price. We as humans implement fear and greed onto the charts in other words supply and demand. As a trader, I identify those areas and assume based on past history that these areas will play a role in the future. That's all it is. Yes prices are random, but the people trading the markets have patterns that we can clearly take advantage of.

[@shuang7877]

I am a researcher and a trader - I agree price is mostly random, most of the time. We use ML method to squeeze out potential profits, holding many positions and let the statistics play out. Technical analysis works IF a trader is exceptionally good (like you said, different traders will read different patterns). The tool is like a pencil and not everyone is an artist. One can say the same for any ML methods (which mostly don't work if all they do is throwing data at it)

[@jonfibonacci]

Prices are not random. I call trades almost every single week.

[@CodingJesus]

Alright, Jon. Decades of empirical research are now null and void because you said so.

[@jonfibonacci]

@@CodingJesus I call trades all the time. Research is subjective. You can find whatever you want with enough data if you look at it hard enough. Why do you think banks consistently make money in a "random" environmetn? lol explain that one...

[@TahaNasser]

@@CodingJesus researched by who? Take a look at the pnl of traders like Swang, Shark, Steven Dux or even a pleb like myself and you need to ask yourself are we all just forging our results or maybe, just maybe, do we know something you don't?

[@taypangshiang7935]

Why aren't you the richest person in the world yet? Call a trade, put all your assets in that trade, if you get it right every week you would be richer than elon musk by april

[@jonfibonacci]

@@taypangshiang7935 lmao funny!

[@IlluminatiSilver]

We tend to agree. however there are certain patterns which most technical analysts agree on and this in itself creates short term moves in predictable directions. Admittedly longer term they do not necessarily play out but if all analysts believe that a price is going to rise off say the 20 day EMA then they will all take similar positions causing the price to rise - for day or hour traders that is all they need. That said we are great fans of DCF valuations - but this is more difficult in the crypto markets for example where currently its almost impossible to assess future earnings for most if not all cryptos.

[@hadyboustany7222]

Technical analysis does not try to predict future price but the probability of the price to go up or go down because of course, no one can predict the future. Even with the buy and hold strategy, investors are not predicting the future price but rather betting on the probability that price will appreciate in the future, they believe that price has a higher probability to go up. As there are economic and political metrics that give hints about the probability of price direction long term, there are technical analysis metrics that indicate the probability of price direction short term, and people are using them and making money. technical analysis and investing, both use probability as their metric.

[@joshfoster9832]

Sat here listening him talk about fundamentals whilst trading crypto... huh

[@boogaloobomber9889]

Better watch them Bitcoin fundamentals ;)

[@JuniorSantiago3x]

I agree 100% with this video, let us ignore that millions of people are doing technical analysis and trading based on it let us ignore accumulation and distribution, supply and demand, support and resistance let's ignore what market structure is, LET'S IGNORE ALL OF THAT

[@TheRealDyscyples]

Yes

[@Quantiimo]

Lets believe what 10% of 'day traders' are using and gamble all our money away 🤡🤡 Go and read what financial signal processing is and come back and comment. Instead of commenting dumb sh*t.

[@findofamin]

I agree with almost everything you say, but the biggest problem with disproving TA is that TA is too wide, it is chart patterns, price action, support resistance. Also the same can arguably be said for algo trading, most algo trading is just MA crossover crap. Even if it makes money it rarely outperforms.

[@seph8265]

I agree with you on the "only using a single indicator" part. Something that you have to know though is that people can actually create an idea on where price is heading to if they do it correctly. Technical analysis isn't only about chart patterns too. There are different techniques that I use (Not only indicators, my trading plan doesn't use many) in my trading strategy that can earn me profit if done correctly. Obviously, Price action alone isn't very effective, but if added with fundamentals, I think if the person knows what they are doing, and isn't just using one simple indicator they can earn profit.

[@ralphralpherson9441]

YES, you cannot look at TA one-dimensionally. It is there to inform you once you have done the research and reviewed the fundamentals.

[@rickyrelease9665]

@@ralphralpherson9441 exactly

[@olivierhayat4465]

Good Morning, what's according to you the most important indicators to look at?

[@rickyrelease9665]

@@olivierhayat4465 TTM Squeeze, RSI, MACD, and Stochastic Crossover are useful when used in conjunction with one another on Longer time frames. Everything of course should come secondary to the fundamental analysis of a business and it's potential for earnings, and free cashflow growth

[@MrSupernova111]

I think a common form of TA that gets overlooked is dollar cost averaging. It works. Its not some groundbreaking strategy but its purely based on TA. I think monitoring a few indicators for securities that we're already interested in could yield additional returns. But I think Coding Jesus is talking about algorithmic trading which is a whole other ballgame.

[@0824kenchan]

Data produced by a stochastic proccess of predefined rules can be plotted in a certain distributions, yet it's not purely random.

[@karamokobarranco9986]

what are you talking about?

[@0824kenchan]

@@karamokobarranco9986 that means data looks random, but if you decode well, you might find regularity.

[@90deltaderivatives35]

@@0824kenchan bingo.

[@_harrysingh]

@@0824kenchan true. And TA is not BS

[@cgb1394]

Thanks man I'm glad someone made a video about this. and you did a good job. the technical analysis gurus use "barnum" language sometimes. liked and subscribed!

[@rafkelly2841]

I dont know what people smoke to see hammers, tea cups, head & shoulders in the price movement.

[@fox_den]

I think I see the big dipper

[@singaporeghostclub]

🤣🤣🤣

[@ayashdwibedy4183]

Ever heard of Al Brooks. Go check it out. You will understand why hammers , tea cups and head & shoulders matter and why it doesn't matter. Technical analysis is but a small component of successful discretionary day-trading. If it was such a big factor, everyone would be shitting money and experience wouldn't matter. Yes, there are cringe content creators packaging pattern recognition as a course, but you would be naive at best to believe it is the holy grail for success in day-trading industry.

[@Rahulbajaj561]

Cup and handle work wonders, I used it in 3 of my trades this week, All of them turned out to be successful. My mentor sometime uses head & shoulder at 1min timeframe in Future indexs. He makes roughly around $500 per trade. His monthly accuracy is roughly around 85%.

[@Rahulbajaj561]

Just bc you dont know how to use these patterns doesnt mean it's rubbish

[@CriollismoPeruano]

Crypto investor here. I can tell you some of these tech analysts do look at several indicators at once, not just one. They also look at many other factors at play outside of the charts, the market dynamics, macro economics, business fundamentals, and even the psychology behind investing trends. Not saying I would pay $700 for a Tech analysis course, but if someone has made 10 to 20 times more money than me investing, I sit back and listen.

[@HAGA7793]

It’s all probability and when they get it right, it’s a confirmation bias.

[@CriollismoPeruano]

@@HAGA7793 It's all about predicting the most likely scenario of course.

[@DeadlineProof]

Any extreme and polarizing opinion is the kind of bias that will hurt yourself long term in any field but especially in finance. Your strong belief are just your own bias and it is not more true or worthy than any other bias out there.

[@usercos187]

we can say the same thing for people believing in candles patterns...

[@DeadlineProof]

@@usercos187 for sure , in markets if something is used extensively it stop to work due to market efficiency. And also no "one fit" strategy could work at scale. What really makes the difference is a good framework to properly test any belief.So you can only believe in what you tested and as far as you can believe your test methodology.and keep testing to confirm that your findings are still relevant over time.

[@prodcdebeatz7205]

After watching this guy I’m thinking I might actually be smart enough in finance to make a algo. Thanks for the confidence!!

[@user-fk3do1fe8q]

1:10 Undoubtedly, Statistics and data analysis is the KEY* to Quant trading. If one thing is going random, this is "USELESS" for doing statistical or data analysis. In every introductory level of Statistics Textbooks will mention this concept. If the market is random, you are saying the Quant Trading is useless as well.

[@friend2194]

In long term it is, and you can make profit from these momentary price inefficiency, then in the process making the market efficient again. Still, it is just a hypothesis, not definitive truth

[@MI-qj6xr]

You make Dunning and Kruger really proud

[@matheusxavier2709]

I started with TA even after having an MBA in Economics, but soon I realized I was spending too much time trying to read charts and was getting stuck. Since I started learning fundamental analysis and buying and holding, the profits came, with less time in front of a screen.

[@sakarikaristo4976]

It’s funny that both opportunities and problems lie in that although something has value in it, not all people recognize it. Somebody has written about TSE:2221 on a Wikipedia page and on forums etc. but the stock has not moved that much.

[@TheRealDyscyples]

Basically you don’t trade

[@DrBluefox]

the less you trade the more you earn@@TheRealDyscyples

[@arsenalmanic]

How about the head and shoulders , the cup & sauce pan ? The focaccia bread signal ? The double top triangle suplex ? surely these are legit ways to $$$s. No ?

[@DrBluefox]

@@arsenalmanic to be fair trading can be profitable, just not TA

[@evanscritchfield2663]

Here’s my TA. Buy low, sell high.

[@afrioneacademy2488]

That's what I am talking about

[@chenli1066]

Technical is something that if everyone or nobody believes in it, it won't work. if many believe in it, it works.

[@batyok2611]

How to tell you're not a quant without telling you're not a quant

[@crazydog3307]

i'd argue that sure prices can be random, however they will generally follow a pattern of randomness, within a given range of randomness, which can be predicted, so although you cant predict exactly what price will be reached by a given time, it's entirely possible, at least theoretically, to predict the range in which that price will be

[@svenbardos6637]

old comment, I know. But: It's even worse, if you look at a random brownian motion there is a range where the particle can be within the next second. It doesn't beam. Well, prices do beam from time to time. There can be huge gaps. One "black swan" event and the prices beam to the south :-D

[@kaganozdemir4332]

randomness doesn't mean it can't be predicted though. you cannot precisely forecast maybe, but surely you will have a quite good estimate.

[@user-ps7rr1no6n]

Fair analysis'.. but I can't help but wonder what systems traders like Tepper used.

[@3poli]

TA works because most people are trading according to it.

[@TheInsaneBrother]

But given that many people trade based on technical analysis, isn't that creating its predictive value? The head and shoulders example isn't a good prediction for a price, but it seems to confidently predict a thiker order book which in turn could be used to get a better price for a high volume order or something. I mean in essence, isn't a big chunk of the market just human psychology?

[@navinasd]

Price is also a function of views people are having over a time period. Charts are a view showcasing machinery. On patterns, fundamental analysis is also a pattern recognition exercise over the fundamental functioning of the company. The financial ratios do the same work as that of a technical chart over long term basis.

[@razerfx8186]

No because the value of a security today has no bearing on its value tomorrow.

[@OnlyTrader69]

If you develop a specific strategy with clear rules and parameters, test it across numerous scenarios for a particular asset, and gather enough data, you can derive meaningful statistics. Based on these statistics, you'll understand the probabilities behind the strategy's success. Only then can you determine whether it's a good strategy. Attention to micro-level details is crucial in creating a reliable approach. TA is one way to gather this data, but does a strategy work all the time? Of course not. We must rely on probabilities and statistics, which, in my view, is a more scientific approach than buy-and-hold.

[@Kenneth_the_Philosopher]

One of the best definition of price that is perfectly consistent with main stream modern finance that I ever heard!

[@esyn4582]

One of the worst actually. Incomplete and in some occasions wrong.

[@nilomartinezjr8005]

@@esyn4582 I would say it's not even bad alone, but naive, narcissistic and shallow.

[@MrArtless1]

A simple challenge. A trading competition between my TA trading and your quant algo. I'll give you 2x my starting balance. Whoever makes the most in a period of time wins.

[@DivineAtheistWannabe]

Classic TA ego. You made the money cos you're smarter than everyone at reading a chart not cos you get lucky

[@bignastytiger4174]

@@DivineAtheistWannabe not really. He probably knows how to find key Supply & Demand areas, which is a proven, successful TA strategy.

[@pabloa6855]

@@DivineAtheistWannabeif he wins he wins

[@thomashammerheart3915]

“The random price is pricing in all of the news from the future immediately” got it 👍

[@macfiona4545]

I respect your advice but I have a question: aren’t you bound by Disclosure Agreements not to share your experience on Public Platforms?

[@hansen370]

@@thomasscoville1148 Oh man, good one!

[@potentwater2260]

Good question

[@macfiona4545]

@Michael Bolton , is this yours Spam account?

[@potentwater2260]

@Michael Bolton not everyone has the same experience as you.

[@potentwater2260]

@dev stuff birds of a feather flock together.

[@hichamlamsaouri]

I completely agree with you in everything you have just said, thanks for the effort you are making to popularize the quant trading.

[@mindin2941]

The debate about whether the market is random or not. That debate is not over. And its way deeper than this simplistic take. Appreciate this guys perspective and its not to say he is wrong. But there is a lot more to it

[@KenSemerkant]

The only reason the technical analysis works is because it is self fulfilling prophecy. As a programmer generate a random walk price simulation and with one participant in the closed market do all pattern recognition your heart desires and until cows come home; it would not impact the pattern; however add few other simulated participants to your simulation and augment the random walk with expected price reactions outlined in the pattern book and the close system will start to fulfill the prophecies. I would love to see you put this simulation together and post it on your channel. With that said since we operate in a market where we have many participants TA works for all engaged.

[@unfilteredminds-zd4ig]

but it doesn't work because 95% of traders are losing all their money. That is the result of TA. If you use TA and you are making money, then it is only because of luck. One day, TA will fail you.

[@firstconsul001]

Served !!!@@unfilteredminds-zd4ig

[@leftphilange69]

The very fact that people believe in chart analysis is enough to prove it has value - if we know people are buying based on patterns, all we have to do is look for those patterns and we know that other people are buying and selling based upon that pattern. If we know that a bunch of people are going to see a pattern and act a certain way that impacts price, that’s just another catalyst for our decision making. Think about it - if people believe a pattern is a bullish indicator, they’re more likely to buy which makes it a self fulfilling prophecy. All you have to do is see this pattern before others catch on and front run them.

[@joeygarza9550]

So basically, using TA is nothing more than _agreeing_ to "play the game" of investing while "making up the rules" collectively with others, which enables the "players" who've studied the "rules" (TA) and who abide by them, to profit by them.

[@BigWickEnergy_]

@@joeygarza9550 “So basically” is what you typically use to simplify something.

[@RapCityco]

For every bullish pattern there is a bearish pattern. And even if ta did work. Bots would be able to predict those patterns soo fast that youd always be too late.

[@BigWickEnergy_]

@@RapCityco This is goofy and not always true.. Dumb money and liquidity pools generally fuel the success rate of patterns.. not always people seeing an opposite pattern. But even if it were true you’d have a 50% chance of success on select patters. If your money management and R&R are in order you will have a VERY lucrative career with a 50-60% win rate.

[@RapCityco]

@@BigWickEnergy_ dumb money are the ones who use them lol. These trends happen on covid charts, car crash charts. Do you really think covid deaths will outperform black death if it has a bullish pattern?

[@josephwehby9313]

How are you defining TA? Like using indicators? Also, would you consider this TA or a quantitative approach. For example, lets say you back-test a strategy on historical data and find that 70% of the time when a stock gaps up 50% pre-market, there is a dip at the open and then a 10% spike, so every time you see this you buy the dip and catch that 10% move. Just curious if you would consider this quant or TA

[@remkoehrhardt5879]

indicatitors are def not TA

[@humanyoda]

@@remkoehrhardt5879 Using indicators is not using TA? What is TA then, in your mind?

[@jamesflames6987]

That's not "quant" or "TA", it's a story you made up in your head. There are no such patterns and mathematically they cannot exist.

[@ethan_martin]

You said that the price of a stock is based on the prediction of future cashflow. However, how do sentient people (in the short term) predict a commodity's future cashflow? It might not be entirely based on the previous prices of the stock, but it seems unlikely that it has nothing to do with it.

[@wizard7314]

But when all the market follows technical analysis it becomes a self-fulfilling prophecy. There are also psychological elements to price action, such as resistance levels, which technical analysis is based on.

[@RapCityco]

For every bullish pattern there is a bearish pattern

[@theamazingbagman2492]

Great content! But I have to disagree at one point - price is not random. Technical analysis is indeed bullshit, that is heavy exploited by professionals in the process of liquidity engineering. That's why the markets are predictable - if they weren't heavy manipulated, that would probably prove your point and price would remain "random". The only things that matter are order flow and volume, because if there is a heavier hand in the market that is manipulating the price, the only thing you can do is follow it. Nobody can spot big money using technical analysis, yet it is doable with order flow tools.

[@drek273]

What are some order flow and volume tools that you reccomend

[@martinbeyst8834]

@@drek273 Personally I use jigsaw and am getting great results.

[@bin4ry_d3struct0r]

I'm not sure if I correctly understood the point about current price being a subjective valuation of future cash flow. If I pay $100 for a share of stock, I'm expecting the share will generate more than $100 in the future. I'm not paying $100 now in expectation that the share will be worth only $100 in the future because my money's current worth will have been devalued by inflation.

[@SS-km1xz]

You are right but upto a certain extent. Technical analysis is a very broad term. There are traders who are very good at it and make good money entirely on the basis of Technical analysis. Quant trading is real thing & fairly new concept but TA is the based on real human emotions, fear & greed, demand & supply etc which is a part if real technical analysis you cannot underestimate it

[@MrSupernova111]

I think Coding Jesus failed to properly define what he considers TA and how it differs from a proper trading strategy. I agree with him but clearly some TA is necessary to determine entry and exit points.

[@cbs1730]

At the very least, TA is excellent for revealing where the herd mentality of the markets are! Because so many market participants are believers in TA, it is a self-fulfilling prophecy and can absolutely be used as a predictive measure of markets. I personally have multiple strategies that seek to capitalize on the sheep trading solely from technical patterns and they've been working well!

[@briangallardo3246]

Yes their stops are definitely targeted

[@criptochango9472]

You wrote this 1 year ago, where are you now? Working in McDonalds?

[@millenialmusings8451]

@@criptochango9472😂😂😂

[@energyclown58]

There is actually a bot which is really profitable in the long run and relies on technical analysis with a hard stop loss and take profit and no risky system like martingale or hedging. So this kinda proofs this video wrong

[@alexiseric5210]

Don't you think small prices movements can be predicted with trade flow imbalance and order flow imbalances ?

[@onicelaux7756]

Well, i do know thats a fact

[@avi1enkin]

How is the technical analyst saying when bitcoins weekly trend turns up statistically speaking it is a good time to ladder into a position,(or for that matter ladder into positions on the weekly up trend in Bitcoin when the 3-day stochastic crosses up) different from a quant coming up with a model?

[@nilomartinezjr8005]

Good point. Unless the quant model is bases on star charts, instead of price charts. Which would make it divination instead of science?

[@jimmyhumuhumunukunukuapua]

'Price is random' man i have to disagree fully here. a thing is random because you don't have all the information. that is why you might look at other indicators such as volume, inventory, etc. Randomness does not exist. a thing is percieved as being random only because you don't have all the information.

[@gianni50725]

If you say this you are utterly ignorant of what random means. Prices in the short term are indistinguishable from random noise. You can find this is the case time and time again. Whether it is “truly random”, whatever that even means to you, is irrelevant to the trader.

[@karlbooklover]

TA patterns are part of the same subset of patterns quants use, so defining them as garbage basically defines quantitative analysis as garbage. If prices are completely random there is no point of trying to quantify them and basically your job is a joke. You must be kind of not have an intuition about math to not realize this basic principle. Quants have their own kind of astrology, for instance defining volatility as risk, not because it's true but because they don't have any other way to quantify it. As Warren Buffett explains here: kzbin.info/www/bejne/f5a7Y4Cflp53gas

[@pipsrus8760]

perfectly said

[@alogahjames9490]

I feel a deep sense of regret for ever watching this video.

[@TheCuratorIsHere]

Quant is garbage.

[@jain9134]

the traditional way of looking at the prices with indicators doesn't really work. But the point is to have some probability at start and then adjust the portfolio as the prices move. it is wrong to say everything about technical analysis is crap. Best strategies are always simple but what makes the whole thing complicated is how you move your position given the large sum of money. buying a stock because of a MA cross over may not make money. But quite honestly, prices are not that random. At least to me, if you pick 5 good mangoes out of 10 from a basket, it is safe to assume that the 6th one would be good as well. of course you can go wrong. but with that probability, given the large set of trades you make, you have a more than average probability to win.

[@alexanderfournier7292]

It's really impressive how smart you are. Your depth of knowledge in multiple areas is wild.

[@jag5798]

Price comes from what the insiders know before you do. Case closed.

[@Dimatrixone]

If you still blindly believe in pure technical analysis, I would recommend you to write a program (if you can of course) simulating trading support and resistance levels. And what you will find is that there is no statistically significant patterns to make money from. It will be eyes opening moment for you.

[@kair.7532]

Ok so tell us what we are supposed to use to make money and base our trading decisions on since technical analysis doesn’t work

[@blazkowicz666]

@@kair.7532 That's proprietary lol

[@norseman1140]

@@kair.7532 Here's a tip. Stochastic calculus and markov.

[@joaofernandes2827]

@@kair.7532 Technical analysis work , anyone can easily see it in the charts , repetative patterns.

[@sked555]

Quant trading uses traditional indicators such as mean reversion, RSI, MACD etc..

[@CodingJesus]

Wrong. So wrong.

[@kaloyanhristov6336]

Hey, man! Great video! So, do you believe in fundamental analysis?

[@CodingJesus]

Thanks! And no I don't.

[@kaloyanhristov6336]

@@CodingJesus Maybe you can make a video with its flaws?

[@barshalen99]

Lol why do all young beginner Quants think they are gods gift to earth? Lmao. This guy is overreaching on alot of points here.

[@rhythmbabbar257]

The guys says that the definition of price is the present value of its future benifits/cash flows/returns and technical analysis is the inverse of it. But future cash flows/returns itself are predicted/calculated on the basis of past data.

[@sographix9521]

I watched this video and another one called "why i dont day trade" and I have come to the conclusion that you have absolutely no idea what you are talking about. Sad Case

[@ThePunishedLeaf]

Do you make money daytrading every day?

[@chillbeach7322]

Three "trading guru" advertisements during this awesome video✏️

[@magma3525]

I spent about 9 thousand intense hours with learning and practicing price action, but I became "consistently" profitable only three months ago. This means, for now, I make a modest 0.5% - 1% profit each day. *Profit consistency would be impossible if the market were random.* Also, your theory that TA takes the least amount of work is dead wrong. I use *no indicators, except moving averages for support/resistance, gaps, trend direction/momentum,* and ATR for exits occasionally. Main tools I use are trendlines and support/resistance zones. *The market is NOT random (**1:00**). When I realized that price behaves certain way it became obvious that price follows certain habits* (1:09). Traders enter the market at certain place/time or the most affordable price - this makes it logical and predictable. If you can predict the market at least with 40% accuracy, as a swing trader, you’ll be profitable. *Contrary to your claim, technical analysts don't expect the past to predict the future (**0:43**).* However, price does remember where it was in the past and responds to it, which is a valuable information. Whether there is a higher probability in taking long trades instead of shorts will depend on the patterns price develops during its response to the past. It is this response that a TA takes advantage of. You're also saying that TA is stressful, but if you are doing it properly, it is not (at 2:08 mark). *If you follow a rational strategy you trade like an algorithm - you trade without stress.* Day trading becomes stressful only when you trade what you feel, not what you see. *There is no difference between the M1 chart and the yearly chart (**4:11**).* If they were side by side you wouldn't be able to tell the difference. *Also, indicators and fundamentals are useless to me- I don't need anyone/anything telling me what price is doing on the chart or when to enter.* Everything that moves price - inflation, earnings, deals, scams, crash, war, contracts, mood, news, computers - expressed on chart as *market dynamics,* therefore, the only thing I need to know is price action. The chart is the end result of whatever preceded it. *Finally, about patterns (**2:41**, **6:28**).* A good TA trader doesn't see a Head And Shoulders pattern as "bullish" or anything (6:50). He thinks in terms of probability. When he sees a HS the question in his mind is "what's the probability of the price moving up/down?" He looks for tendencies or inclinations and bets accordingly.

[@VSlip]

9000 hours man how do you even count them? Can I see some of your trades?

[@magma3525]

@@VSlip I counted the first 5000 hours to the exact hour. After, I had some problems, so I could only approximate the other half - that's why I said "about." My current win% is 85% and the Profit Factor is 1.41. My Win% is up from 67%, but the Profit Factor is down from 2.03. Whether I'll be able to keep this up or not or improve on it will depend on discipline in my case. Mind you, consistency is a relative term. I've never been profitable for three months straight. My goal is to extend this to a year.