VirTra Inc (VTSI)

[dlh29]

charlie bunny,

TA patterns, like head and shoulders, actually are simplified pictorial representations of certain supply and demand patterns. Very few folks who consider themselves TA's understand that volume patterns must correspond to these chart patterns to give them relevance. I feel even fewer appreciate the difference between supply and demand patterns in products that are traded for consumption and products that are not. IMO, this distinction is why TA in stocks is not the best basis to drive one's decisions - particularly over a longer term.

The stock TA crowd has also developed enough different TA triggers to where they can always find one that will explain what happened. This is kind of like economists - there's enough different opinions out there we'll always find someone who was right and this person will tell the others they were simply not giving the appropriate weight to one or more of the variables. This is why I frequently say TA is a wonderful method for predicting the past.

However, this aside, there are certainly times when TA will foretell what is to come. This is especially true now that there are so many people who swear by the read of a chart pattern they don't really understand. In short term swings, these patterns will often lead to self-fulfilling prophecies. This is exactly what I'm hoping will happen with ZRAN. Essentially, I feel TA will lead to and feed over-reactions in both directions.

Regards
doug