I Stopped Using Technical Analysis. Here's What Happened

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35 thoughts on “I Stopped Using Technical Analysis. Here's What Happened”

  1. Good interview. Funny that mathemeticians and many engineers that trade have vehemently argued with me that TA is nonsense, but yet programmers are building TA AI models. I agree, I only use TA for fear and greed of people and bots. For me, it shows patterns. I have done so for the past 20 years. The same with the back studies that I do. I am just looking at past patterns. Peel the layers away and it's all based on fear, greed, and a stocks price action. Options are a little different to where it is using use the Black-Scholes model and you have to pay attention to the greeks . The charts are comfort food for me. Flip a coin.

  2. Crossovers (5 EMA with a 10 EMA) always works and trading options is not trading = options are a PURE gamble…if you wanna trade; then trade the e-mini's (@ $500 per contract) that have a "TON" of leverage = trade the e-mini Dow Futures and when the 5 min and the 1 min charts are headed in the same direction, at the exact second of the crossover, go in and grab $25 – $40 per contract (trade no more than two contracts in your MAIN/CONTROL ACCOUNT and also open a "linked" subaccount where you trade "X" number of desired contracts in that separate account)…..rinse and repeat with crossovers that naturally occur every two or three times per hour (depending upon market conditions) and make a ton of $$$$ VERY EASILY! And with HARDLY any stress!

  3. Clickbait title, garbage content. Take away = Be comfortable. It doesn’t matter. And oh by the way you totally left out the here’s what happened.

  4. I know of a "youtuber" who invests in zombie companies and crypto and This person uses NOTHING except TA. they pull out a trend line or Fib and start calling out "golden zones" where "the liquidity is at". It's safe to say this person is losing a lot of money along with his audience who follows his terrible advice. TA is a great tool, but it's a small piece of the puzzle depending on the overall strategy you're using.

  5. absolutely love it, more than 1 way to Rome, i was the same way first TA, now I mostly look at the chain, implied vol and Expected move then put that baby on and move on to the next trade!

  6. You mentioned you were looking for a certain credit for the delta between .20 and .30. What are you usually looking for?

  7. Great video. The only charts I look at have standard deviations & linear. When you look at charts on different time frames, I always find it interesting how the mean changes when calculated on different time frames.

  8. If you can be consistently profitable without looking at a chart kudos. I’m not sure how great someone can be doing that though. There’s patterns using a chart that happen over and over again and I’m not talking about simple flag and cup and handle patterns. IMO that’s lazy if that’s all someone is looking for to be profitable.

  9. Try trading futures with this "you can't reliably predict direction" nonsense. You guys haven't looked at a chart closely enough. Lazy AF.

  10. The only technicals I look for are volume levels near the edge of the expected move. I feel like it helps me see if the premiums are worth the risk of that certain level. But IV is the first thing I look at. Then I try to look for any skew on the Put and Call side. That helps me choose a direction. More bang for your buck

  11. most tech studies (patterns, moving averages, etc) tell you WERE you have been, not where you are GOING !!

  12. For investors in stocks Fundamental analysis is for selecting stock, Technical analysis is for good timing. The shorter time frame the less important is Fundamental A. As far as options, at least 50% of strategies are directional one way or the other so Tech.A. definitely helps. There are people who say that Technical Analysis is BS, but those are people who don't understand it…??

  13. Great discussion! Personally, I never look at charts and I've been fairly successful over that past decade or so trading options.

  14. Tech analysis are the same as the deltas. IMHO Deltas are past price data and are just doing the math behind the technical lines.

  15. Great Video Errol!! I am about 2 years into seriously trading options and I am with Jermal on using Technical Analysis. I like to use it as a tool! I feel that you have to get real comfortable with support and resistance of the certain stock or ETF . Tasty is great ! Always pumping out great knowledge!

  16. Personally I place my positions on the historical supply/ demand areas to at least have a small directional bias. That and the big events like JPow and CPI announcements recently. Other than that I try to stay tastytrade mechanical, open trades at ~45 days and manage at 50% or 21 DTE.

  17. Here is the best argument why you should use technical analysis: I don’t believe in it, but everyone’s else does. Learning how other ppl would react to trends, support/resistance etc gives you an edge. My 2022 yield: 27%. 2023 YTD: 17%

  18. Given the number of technical and fundamental analysis that have to rely on selling their information instead of trading on it, I don’t think any of it works.

    This was true along time ago, too and is the reason Benjamin Graham and his student Warren Buffett simply look for value or should I say, undervalued securities. Their assumption being that eventually the market will recognize that securities value and fully price it there by beating the averages.

  19. of course you need to look at charts if you are putting a directional trade, tasty ppl usually focus more on delta neutral and volatility and theta plays so no need for charts

  20. Just my opinion, so take it with the block of salt it deserves… Some people are gifted at pattern recognition and technical analysis allows them to quantify and profit from it. For others, myself included, it is like looking at the clouds to find dragons and other creatures.

  21. TA has been proven to not work. It has worked, but those occurrences were simply outliers. In other words, when it has worked, it was just luck. You wouldn’t do something that doesn’t work 99% of the time just because it works 1% of the time, hoping that you get lucky. If you’re gonna get lucky with your trades/investments, you will regardless of why you made that trade. Whether you used TA or not, the success of your trade ultimately does come down to luck. The markets are extremely efficient, and as a result unpredictable. If you guessed right, no matter how educated or uneducated your guess was, you just guessed and got lucky.

  22. Getting the point was to keep it simple, but in this particular example is IVR kinda low, any suggestion?

  23. I used to use so many patterns and studies that my charts looked like abstract art. Nothing worked consistently. Every win was basically a lucky shot, and too few to make a difference. I finally stopped relying on them for any sort of tell in the market.

  24. The only technical signal that's the most consistent is macd and it is very slow to change, so directionally it works. Oscillators will kill you unless you and tend to invalidate at peaks and troughs. Fibonacci and moving averages are great for determining price magnets but basically tasty is great in teaching you to find the value and trade on value. Volume flows are great to watch if you can decipher but it only tells the past.

  25. thats not a flag, flag is parallel channel in design sloping downwards if bullish with a impulse move. Yours was symmetrical triangle.

  26. "Psychology painted on a chart." Exactly the point. Shows you group behavior and suggests where the "pockets" may be that Jermal talked about. I'll take a look after I've identified tasty mechanics in a spread.

  27. Simplicity is the best. if you were to disappear for 5 years and open up your charts would you be able to understand all of your indicators & use them efficient as if you're on top of your game?
    I just use moving averages lines, and a "multiple deviation VWAP" study to draw lines with labels on the side of the chart that tell me how much money I would lose/gain if the candles were to approach the various vwap lines.

    The market bots & day traders all follow moving average lines.

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