Replies to post #274493 on Zeev's Turnips Patch-No Politics (ZEEV)

[jeffsaxx]

IMO channel lines drawn on chart patterns can be highly misleading. The activities of MM's and specialists to move stocks to accommodate block trading pressures of institutional clients can create artificial lows or highs which define a channel line unrelated to the trading activity in the stock. The channel line drawn from top to top or bottom to bottom creates a RATE of ascent or descent so to speak dependant upon the extremes of MM or specialist activity. For example, why should the channel line for a given stock show a steep decline just beacause a fund liquidated on Friday and the stock was down 1 1/2 points at the intraday low when otherwise it would have been down only 1/2 point which was the close at day end? Or vice versa on a day when a fund loads up? I think to some extent drawing channel lines does work because of the "crowd" efect of chartists who are following the channel lines as a general rule of thumb regardless of the aberrations.
I am not a technician like several others on this board, but I do believe there are other technical indicators which are far more reliable than simple channel lines. But in the end I think day trading and swing trading comes down to experience and "feel" (not voodoo) which somewhat like an exquisite art form is successfully practiced by Zeev and a very few select others.
That is entirely apart from my option trading (lately very spotty) which is a different form of speculation based on high reward to risk ratios.

[Hacktheripper]

The 10 day moving average does not apply to all types of trades.

The 10 DMA is trading basics 101. A simple rule to follow for the
unexperienced chartists. If the stock stays above the 10 DMA its a hold
if it falls below its a sell. This works a good percentage of the time

Bounce plays are a prime example where the 10 DMA may not be a factor...
A stock falls rapidly... ultimately plunging way below the 10 DMA, then you
have to know support levels to play the bounces.

Bottom feeders play by a different strategy, they look for a stock
that has been under accumulation at its lowest PPS levels, hoping for
a big turn around. This is HIGH RISK/HIGH REWARD trading... stocks
at their lows are there for a reason. Additionally, you may have to hold
for years to experience any profit or total loss of initial investment.

There are so many other techniques no one person can explain them in
a post. It can only be learned through years of experience (school of
hard knocks) or private extended training by a professional trader.

Thanks