Technical Analysis Is Nothing More Than Reading Tea Leaves
This one gets me every time, probably because I just love it when charting is compared to psychic or supernatural activities. It’s ludicrous! There’s quite a bit of upper level math that goes into various methods of charting and trading. Also, when back testing is conducted on technical trading methods, the statistical measures used are similar to those used to check for errors in other hard sciences.
Not convinced of the seriousness of technical analysis? Tell that to the members of the Market Technicians Association (MTA). The MTA is a professional society with a professional designation called a Chartered Market Technician (CMT) that requires hours of study and the successful completion of three levels of tests to obtain. There are loads of extremely smart people that make a living using technical analysis who belong to this organization, and they all argue vehemently against the idea that technical analysis isn’t a hard science. And you’d be hard pressed to find a tarot card or crystal ball owner anywhere in the group. For more information on the organization and the designation, you can visit its Web site at www.mta.org.
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