# My Brush with Technical Analysis



## burglar (19 August 2014)

I so enjoyed thinking about something new.
Not to say I'll trade this way, because I am a gambler.


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## burglar (19 August 2014)

Way back in June 2012 I posted this:



burglar said:


> Wow!
> 
> I am not trying to trade on this info.
> Just trying to gain some insight!!




Recently, I tried to read the chart on Azure Minerals (ASX: AZS)

With my limited knowledge, I concluded: 
*a.) perhaps it was running sideways in a channel,
b.) support at $0.028,
c.) resistance at $0.031.

There were many buyers queued on $0.028, so I paid $0.029.
I sold at $0.031, hoping to rinse and repeat.


Then yesterday, out of the blue, an ASX announcement: 

Up from AUD$0.031 in the open, to AUD$0.045 intraday high!

http://www.asx.com.au/asx/statistics...idsId=01543325







*Mr T says "Remember your ABC, Always Be Cool!"


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## tech/a (19 August 2014)

Burglar

Your trying to read a flatline

It has no character.
Not everything has a story to tell.


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## burglar (19 August 2014)

tech/a said:


> Burglar
> 
> Your trying to read a flatline
> 
> ...




Correct!! 
I have reached a turning point.

I tried to read a chart.
I tried to "recognise a face in the crowd".

Don't know yet, if it was a good thing or no.
But I tried to find that story.

I got it wrong, but I did not lose money.
Just foregoing a breakout, not for the first time, I might add.


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## tech/a (19 August 2014)

Burglar

It didn't have a story.
It was dead.
The current bar is the first
bar of any story likely on this page.

Not one Id start learning on.

In fact not one Id ever look at!


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## pixel (19 August 2014)

burglar said:


> Correct!!
> I have reached a turning point.
> 
> I tried to read a chart.
> ...




Congrats, Burglar.
At least you tried. And I wouldn't say you got it wrong. The sideways channel was definitely there, so you snipped a few points. 
Where I agree with tech/a is on the fact that AZS may not be the most rewarding stock for this kind of trades. But you'll only find other more promising ones by either browsing through lots of charts, or employing some search routine that scans the entire market for particular setups, then check their daily movements. 
I do the latter, running some Market Analyser scripts that work for me.
Others may be more fundamentally inclined and build up a watchlist of stocks in their favourite sector/s.

Keep trying; I believe you're on the right track.


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## burglar (19 August 2014)

pixel said:


> ... Keep trying; I believe you're on the right track.




I don't want to stop gambling.
It's my hobby.
Thus far, it is cheaper than boating!

But I do want to stop losing.
If a little T/A helps, then I'll learn a little T/A.



BTW pixel, I had a squizz at your presentation and was truly imprezzed.  

pixels Presentation:
https://www.aussiestockforums.com/forums/showthread.php?t=28829&page=2&p=837327#post837327


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## Craton (19 August 2014)

Good onya Burgs for having a crack.
T/A is certainly hard work from my poor old clunker brain cells point of view but, the more one looks, the more one sees in them there charts.

Having the balls to carry out the conviction is another matter entirely.

Good luck. Oh, and isn't everything in life a gamble anyways?


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## burglar (19 August 2014)

Craton said:


> Good onya Burgs for having a crack.
> T/A is certainly hard work from my poor old clunker brain cells point of view but, the more one looks, the more one sees in them there charts.
> 
> Having the balls to carry out the conviction is another matter entirely.
> ...




When I arrived here in ASF, I thought I was an investor.
But the good humans here quickly put me in the correct pigeonhole


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## burglar (20 August 2014)

MY POINT IS, I had a look on a chart to exit.

For the second time Tech/a, you are correct!

If your gonna rub me down, 
please use cutting compound or fine grade wet & dry, ...


Three reasons why I am here:
To Learn:
To give back:
To have fun:


Just for the record, I have been watching Azure Minerals 
since they were spun out of Nickel Australia 
which were in turn, spun out of Croesus.

I am often in and out of AZS. 
It is a penny dread. 
Not a worthy candidate for a serious trader.

It is unloved. 

When the commodity boom returns, it will be undervalued.
I wanted to be in, rather than out. 
(My past usual strategy! Hold in faith)
Meanwhile, when the AllOrds dipped dramatically,
I had a change of heart.
I thought I was wrong. 
I didn’t want to stay wrong!

I don’t even know why I am justifying this?
Just weird!!


AND MY POINT IS, I had a look on a chart to exit.


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## Boggo (20 August 2014)

Trying to apply technical analysis to a bottom dwelling speccy is like putting a Ferrari spoiler on a Barina and then calling all Ferrari's crap because it didn't work.


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## burglar (20 August 2014)

Boggo said:


> Trying to apply technical analysis to a bottom dwelling speccy is like putting a Ferrari spoiler on a Barina and then calling all Ferrari's crap because it didn't work.



Hi Boggo,

I did not say all Ferraris are crap.
Far from it.
I gave one a test drive!

I already had the Daewoo, and it owed me nothing!


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## Boggo (20 August 2014)

burglar said:


> Hi Boggo,
> 
> I did not say all Ferraris are crap.
> Far from it.
> ...




Good work burglar


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## burglar (20 August 2014)

Boggo said:


> Trying to apply technical analysis to a bottom dwelling speccy is like putting a Ferrari spoiler on a Barina and then calling all Ferrari's crap because it didn't work.




And I didn't say it didn't work!

In fact, it worked a treat.

I was in.
I thought I was wrong.
I used a chart to exit.

I have the capital back in the war chest.
I am looking for a better chart.
But not the perfect setup.
Coz then, I'll be in the grits again.

Meanwhile, a second cuppa!


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## pixel (20 August 2014)

burglar said:


> And I didn't say it didn't work!
> 
> In fact, it worked a treat.
> 
> ...




Again, Burglar: Congrats on persisting;

there is no such thing as a "wrong" method to assess a stock, nor is there a "wrong" stock to analyse with a stock-standard chart.

Most here at the ASF want to help each other.
Most here at the ASF want to learn.

If that is true, it seems to me that you're with the majority 

btw I like your byline, but would add a slight variation:*
"Make funny mistakes, then learn from them. That way you can still have the last laugh."*


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## burglar (7 September 2014)

Like I said earlier, I am in and out of AZS a lot.
So I looked at the chart.
I can't see a story yet, but then, I never could before.

If I can muster a few shekels, I will try for a rinse and repeat!


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## tech/a (8 September 2014)

Try these.
HSK
PSY
RFX
for pennies with momentum.
Lots to learn from these.---Right now and looking back and forward.


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## burglar (8 September 2014)

tech/a said:


> ... for pennies with momentum.
> Lots to learn from these.---Right now and looking back and forward.




Thank you tech/a, 
I will give them close inspection!


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## notting (8 September 2014)

MEP. 

I Just wanted to leave it at that.

But have to say something else, it's just announced a capital raising after a run on a new discovery.
Will surely throw up some opportunities in the near term 15.5 being a level to watch for what may happen next!


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## burglar (8 September 2014)

notting said:


> MEP.
> 
> I Just wanted to leave it at that.
> 
> ...




Hi notting,

Glad you spoke up.

MEP has a long and glorious history.
They found Mt Woods/Prominent Hill.



> Oxiana Limited decided to develop the mine in August 2006, having first got involved in the project in 2003 and having bought its partner, Minotaur Exploration Limited in 2005




Read more: Prominent_Hill_Mine


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## burglar (8 September 2014)

tech/a said:


> ... HSK ...




First thing I noticed for HSK ... it is in steep uptrend.
Then I noted that it rose on (relatively) low volume.

Next thing I look for is a continuation pattern.
Will it go up, down or sideways?
I did not see pattern with which I am familiar.
Doesn't mean there isn't any.

Anyways, I got distracted by a nagging question ... 
What are the into?


Frac Sands?!

It dawns on me that I always do that.
Look for the value!

Frac Sands?!
In Canada!!

Oh well, I tried, 
and I will try again.


PSY tomorrow.


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## burglar (9 September 2014)

burglar said:


> First thing I noticed for HSK ... it is in steep uptrend.
> Then I noted that it rose on (relatively) low volume.
> 
> 
> ...




Yesterday's action; most of the volume traded at the open and in the first 15 minutes.

All the trades were at $0.165 up $0.01 on previous close.
Perhaps buyers were soaking up supply.


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## tech/a (9 September 2014)

The point Im making Burgler is a simple one.
Each are in forward momentum.
These are the types of stock you should be searching out.

Find momentum and hop on it!
Some have flown since my first post!


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## burglar (9 September 2014)

tech/a said:


> The point Im making Burgler is a simple one ...




Here we are in room full of horse manure.
I'm scrabbling through it, saying, 
"There's got to be a horse in here, somewhere!"

You're simply saying,
"Take it to the garden, ... put it on the strawberries"


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## burglar (9 September 2014)

ASX: PSY|Panorama Synergy

The report that started the rise:
http://www.asx.com.au/asxpdf/20140731/pdf/42r4zr14fpt8ph.pdf


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## tech/a (9 September 2014)

Yeh the Fundi guys were all over it!


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## burglar (16 September 2014)

tech/a said:


> Try these.
> HSK
> PSY
> RFX
> ...




Looking "Right now"
I shoulda been looking for ones like these!
But I am not brave enough to jump on them so late.

"Looking back"
What do these look like when ripening?
I believe PSY was kickstarted by an announcement.

"Looking forward" 
When to get off?
What should I look for?


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## Julia (16 September 2014)

Burglar, get yourself a book about trends and how to use them.


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## Sir Osisofliver (16 September 2014)

burglar said:


> Looking "Right now"
> I shoulda been looking for ones like these!
> But I am not brave enough to jump on them so late.
> 
> ...




Would you like some homework?

Tell me what's happening in SBM.

Cheers

Sir O

Edit - NOT A HOLDER, NOR A RECOMMENDATION


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## pixel (16 September 2014)

burglar said:


> Looking "Right now"
> I shoulda been looking for ones like these!
> But I am not brave enough to jump on them so late.
> 
> ...




The way I interpret Tech's suggestion:
Grab a chart of any of those stocks, scroll back to where they turned up, and look for clues that may have suggested "something is underway". Forget the announcements for a moment; just focus on the chart and try to find similarities. They're there.

Example: PSY on July 30th.




Now scroll forward one day at a time ...


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## pixel (16 September 2014)

Sir Osisofliver said:


> Would you like some homework?
> 
> Tell me what's happening in SBM.
> 
> ...




Good point, Sir O.


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## skc (16 September 2014)

Sir Osisofliver said:


> Would you like some homework?
> 
> Tell me what's happening in SBM.
> 
> ...




Short answer... Not sure except that Hunter Hall is buying big.

Long answer
- The financials are saying "I need to raise capital to pay down $450m of debt in light of the falling gold price and costly operations."
- The management announcement is saying "Trust us to improve the operations and bring this thing back on track."
- The chart is saying "Here's some resistance for you @ ~23c. Break through this and you can go try 30. Otherwise I am going back down to ~17c."
- My gut is saying "Quite a few different (and wild) things can happen in a hurry and without much warning. To trade this I'd either be scalping a tick or two, or keep a pretty wide stop and hence small position size."


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## tech/a (16 September 2014)

skc said:


> Short answer... Not sure except that Hunter Hall is buying big.
> 
> Long answer
> - The financials are saying "I need to raise capital to pay down $450m of debt in light of the falling gold price and costly operations."
> ...




Ill answer Burgler when I have more time.
SKC

There is only one thing to note here
What causes it and why is of no concern.
Price has doubled in a few weeks.

It telegraphed something was about to happen 
then it confirmed it.

*The trick is to find setups where momentum is changing 
and anticipating the move with a low risk trade.*

Look at the chart it REALLY IS clear.


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## skc (16 September 2014)

tech/a said:


> Ill answer Burgler when I have more time.
> SKC
> 
> There is only one thing to note here
> ...




Of course it's clear. It's broken out! It's easy to see repeatable patterns of the stocks you've mentioned... because they have all broken out. But to trade it and take a position in anticipation for the breakout one would need to make a call beforehand. 

And what you may deem to be a low risk trade may have such high risk that you don't even realise exists.


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## tech/a (16 September 2014)

skc said:


> Of course it's clear. It's broken out! It's easy to see repeatable patterns of the stocks you've mentioned... because they have all broken out. But to trade it and take a position in anticipation for the breakout one would need to make a call beforehand.
> 
> And what you may deem to be a low risk trade may have such high risk that you don't even realise exists.




No it *WAS* low risk.
See chart re your comment.
As for making a call before hand it was clear to 
not only myself but others that this was telegraphed.

The point I'm making to Burglar and anyone else who trades stocks and wants
to listen is to become proficient in finding these.
You can get in well before breakouts. But there will always be those who are "*So blind they cannot see*"


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## skc (16 September 2014)

tech/a said:


> The point I'm making to Burglar and anyone else who trades stocks and wants
> to listen is to *become proficient in finding these.*
> You can get in well before breakouts. But there will always be those who are "*So blind they cannot see*"




That's the theory. In practice the trader gets into so many false starts that they lose 5R before they catch a real break. And only to have the break reverse on them and net 2R.



tech/a said:


> See chart re your comment.
> As for making a call before hand it was clear to
> not only myself but others that this was telegraphed.




I'd invite you to make some calls (say 20-30) on similar patterns live and see how many of these turn out, but I understand it's difficult to committ to a project as such.



tech/a said:


> No it *WAS* low risk.




Even if you got in at 12c (as opposed to 12.5 which is what EOD traders would most likely have paid), you'd have your stop just below 10c. So risk = 2c (but probably more like 2.7c with an entry at 12.5c and stop at 9.8c) and with SBM currently trading at 18c... it's a grand total of 6c profit or 2-3R. 

Then there are the risks (trading halt, capital raising, convenant breach or just an overnight gap) that you simply don't want to know about.

Hey look, a low risk setup.


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## tech/a (16 September 2014)

skc said:


> That's the theory. In practice the trader gets into so many false starts that they lose 5R before they catch a real break. And only to have the break reverse on them and net 2R.
> 
> 
> 
> ...




Id love to have the time to commit to the exercise.
I maybe in the position to test something like this at sometime.
Its part of the programing I'm doing currently.

Stay tuned.
If I find the odd one ill post it up as early as I can find them.


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## skyQuake (16 September 2014)

Sir Osisofliver said:


> Would you like some homework?
> 
> Tell me what's happening in SBM.
> 
> ...




*There was talk of hunter hall (sub holder) selling out their 50m shares. But it didn't seem to happen. 
*Cannacord then started buying like madmen.
*Denver Gold forums this week, SBM expecting to see +ve Cash flow by June 2015 (Sureeeeeeee...)
*Its a S&P 300 Del this fri so I'd expect to see some heavy selling into that close.

Oh and today's move doesnt look very bullish - violent rejection of the Dec swing lows



skc said:


> Hey look, a low risk setup.
> View attachment 59418




Nice try, you're already max long aren't ya!


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## burglar (16 September 2014)

Hi notting,

Your predictive powers are amazing.
Will 15.5c hold.


On 29/08/14
More high-grade results at Artemis Cu-Au discovery:
http://www.asx.com.au/asx/statistics/displayAnnouncement.do?display=pdf&idsId=01547979


A report that should have fired up, but for the announcement of a SSP.


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## rb250660 (16 September 2014)

Listen to skc.
Predicting the move with technical analysis is just bs and will end in tears with trades like these. If it was that easy we would all be trading from an arm chair on the beach full time living the dream just like this guy.

http://www.amazon.com/Weekend-Trend-Trader-Nick-Radge-ebook/dp/B00F4P0OWA/ref=sr_1_1?ie=UTF8&qid=1410862745&sr=8-1&keywords=Weekend+trend+trader

Trade the break confirmed by the good news. Beware the punter who falls for the pump and dump and gets trapped in a cap raising. It is possible to make a decent living from trading this rubbish and quite easily if you really know what you are doing.


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## rb250660 (16 September 2014)

burglar said:


> Hi notting,
> 
> Your predictive powers are amazing.
> Will 15.5c hold.
> ...




Leave it alone, it was over two weeks ago.


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## tech/a (16 September 2014)

rb250660 said:


> Listen to skc.
> Predicting the move with technical analysis is just bs and will end in tears with trades like these. If it was that easy we would all be trading from an arm chair on the beach full time living the dream just like this guy.
> 
> http://www.amazon.com/Weekend-Trend-Trader-Nick-Radge-ebook/dp/B00F4P0OWA/ref=sr_1_1?ie=UTF8&qid=1410862745&sr=8-1&keywords=Weekend+trend+trader
> ...




These are technical setups just like many other setups.
They aren't predicting anything they are anticipating
a reaction to the volume.

So in your opinion what has been shown is B/S or is all T/A--- B/S?

I agree that hopping on momentum is the best way to minimize risk It can eliminate it.
Nothing wrong with having a stable of prospects where momentum is anticipated 
then hopping on once confirmed with a breakout.


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## skc (16 September 2014)

rb250660 said:


> Listen to skc.
> Predicting the move with technical analysis is just bs and will end in tears with trades like these.




I didn't mean technical analysis is bs. I was just saying that, looking at a chart that's broken out and calling it obvious doesn't actually prove anything.



rb250660 said:


> If it was that easy we would all be trading from an arm chair on the beach full time living the dream just like this guy.
> 
> http://www.amazon.com/Weekend-Trend-Trader-Nick-Radge-ebook/dp/B00F4P0OWA/ref=sr_1_1?ie=UTF8&qid=1410862745&sr=8-1&keywords=Weekend+trend+trader




Interesting. I didn't know Nick Radge has a book / strategy like this. 



rb250660 said:


> Trade the break confirmed by the good *(or bad) *news.




+1. This will dramatically increase your win%. Couple with watching the depth and you will have some truely low risk trades.


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## burglar (16 September 2014)

rb250660 said:


> Leave it alone, it was over two weeks ago.




For two weeks it has been coming down to my price.
Watching very closely.
Will almost certainly buy.
Will almost certainly use a chart!


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## pixel (16 September 2014)

skc said:


> I didn't mean technical analysis is bs. I was just saying that, looking at a chart that's broken out and calling it obvious doesn't actually prove anything.




The main bs about T/A is the misguided expectation that T/A can make a "prediction" about the future. Whenever there is a discussion about relative merits of Tech vs Fundas, it's long odds that a denier will argue "Try as you may, you can't predict the future." Or they challenge you to "predict where XYZ's share price will be 6 months from now. Anyone expecting that kind of prediction should visit Athena Starwoman of Madam Tarot. 
What Technical Analysis can provide, however, is a set of relative probabilities of the way a given setup will be likely to play out, like those Volume-Price sequences, or the Momentum turning before a price breakout. If I see a pattern that has - in the past - had, say, an 80% chance of an impulsive rally, I do call it an obvious signal to enter. Should this particular case follow the less likely 20% and not get on with it, I'll have a Plan B, cutting the loss short *without emotional attachment* and moving to the next obvious setup. No individual trade need to follow "a prediction", but over time, I'll be way ahead *purely by statistical law of numbers.*

Check out this chart of your example: The combination of volume and momentum that I routinely use gave me one signal in late April, which followed a path with a lower probability and was therefore overturned very early. The next cluster in early June was successful; with the entry at 9c, I had the choice of swing-trading up to 11c, or staying Long, topping up in early July and doubling, even tripling my money.




And this is how the chart looked BEFORE the breakout. The arrows in early June were picking up the increased volume and turning momentum - quite obvious, really. Tradeable between 9 and 11, re-entry in July at 10.5 to 11.5c; or staying on...




Mind you, other methods may have fired differently; my point is: if you have a proven analysis and the skill to use it, ignore calls of bs and just go on earning a living.



> Couple with watching the depth and you will have some truely low risk trades.




About depth, I beg to differ. Market Depth is of limited use because it is, and has been for decades, used for all kinds of deception. Be it U/ entries (now rarely used), queue jumping (frowned upon by ASIC), level stacking, or adding bogus entries being pulled before the Market gets to them,... the main use I get out of a depth screen is a vague notion of which way the deceivers may intend to trade. The rest is bs as most orders come off screen, so you can never be sure of the real intention of the powers behind an order.


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## skc (16 September 2014)

pixel said:


> What Technical Analysis can provide, however, is a set of relative probabilities of the way a given setup will be likely to play out, like those Volume-Price sequences, or the Momentum turning before a price breakout. If I see a pattern that has - in the past - had, say, an 80% chance of an impulsive rally, I do call it an obvious signal to enter.




Well that's my point exactly. What is the probability of the identified set up resulting in an impulsive rally? I'd like someone to be able to quantify that with some real time calls, as opposed to using some broken out charts to call out repeatable patterns.



pixel said:


> About depth, I beg to differ. Market Depth is of limited use because it is, and has been for decades, used for all kinds of deception. Be it U/ entries (now rarely used), queue jumping (frowned upon by ASIC), level stacking, or adding bogus entries being pulled before the Market gets to them,... the main use I get out of a depth screen is a vague notion of which way the deceivers may intend to trade. The rest is bs as most orders come off screen, so you can never be sure of the real intention of the powers behind an order.




It is of very limited use unless one knows how to use it! Market depth in combination with course of sale can give you heaps of information and often before it is shown on a chart. All the prop guys use it. Perhaps there are some trading strategies that can still be profitable without using market depth. But, here's a passage by Mike Bellafiore from the book One Good Trade 




When trading penny stocks (like SBM), watching the depth can also be used to save yourself a tick or two on entry and exits. When you consider each tick on a 10c stock is 5%, these add up considerably. Say your entry was 12c and your automatic stop order was 10c, you will be stopped out if the bid/ask was 10/10.5, and someone just sell 1 share into the 10 bid. By watching the depth and you see still plenty of bids at 10 and not much ask at 10.5, you can choose to wait or put your sell order in at 10.5 and get a better price.


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## burglar (17 September 2014)

skc said:


> ... as opposed to using some broken out charts to call out repeatable patterns.




Three breakout charts were offered by tech/a, 
*to be illustrative.*
His point is simple.

The information is there.
If one fails to see it, one misses out.

Take the horse manure (or bullsh!t) to the garden.
Put it on the strawberries.
Watch them grow and ripen!

The same lesson would be harder, 
if the breakouts had not yet happened!


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## rb250660 (17 September 2014)

skc said:


> Interesting. I didn't know Nick Radge has a book / strategy like this.



I coded it and it's pretty good if long term trend trading is you thing.



tech/a said:


> So in your opinion what has been shown is B/S or is all T/A--- B/S?






pixel said:


> The main bs about T/A is the misguided expectation that T/A can make a "prediction" about the future.




What pixel said tech. Using t/a to predict high probability moves in things like MEP PSY TOE (i currently do not hold any of these) et. al. is impossible. The break on news is how it's done in my opinion. How to get in and out is the hard part to work out for most people.

With that said my primary strategy is a purely technical swing trading method and looks for high probability setups. This year its been right 92% of the time with higher than usual trade frequency and profit. Breakouts in the small cap arena have been easy money too for the last 6 months or so. This year has been great year so far for many traders.


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## pixel (17 September 2014)

rb250660 said:


> What pixel said tech. Using t/a to predict high probability moves in things like MEP PSY TOE (i currently do not hold any of these) et. al. is impossible. The break on news is how it's done in my opinion. How to get in and out is the hard part to work out for most people.




I'm afraid you misunderstood what I said, rb...

I don't "predict" anything for any stock. But I believe my MEP example is evidence that T/A does indeed work on penny stocks. It may not tell at the outset how far a rise is about to go; that depends indeed on news or events "out of left field". However, given sufficiently strong signals underpinned by volume, momentum, and trading activity, high-probability signals like the ones in my MEP example have proven highly profitable over time. *For all types of stocks and over all time frames.*


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## tech/a (17 September 2014)

*SKC and rb250660*

You make solid valid observations.

But like most discussions the actual *APPLICATION* of a strategy is where it all falls in a screaming heap.

So In cases like a consolidation where we *CAN'T PREDICT* but we can *ANTICIPATE* an increase in positive momentum---you would simply set a conditional buy stop order on how many ever prospects you have.
This order wouldn't be triggered unless the momentum went far enough to trigger the buy stop. Of course once away you set a stop at B/E---as you will see in the short exercise I did here with PAV---the link posted already the overall risk is cut dramatically when you can move to B/E. While the exercise wasn't this----it does show the value of movement to B/E in respect of* time taken to recover losses and overall Risk to Reward.*


See chart.




I have some old searches at home so happy to have a look for some and post up some prospects to see how they go. Had a look last night and there was 1--forget its code----


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## galumay (17 September 2014)

I guess if you believe in TA then by default you have to believe that patterns will recur in the graphs you plot and that its possible to gain an edge by looking for events (volume, price changes etc), that have led to outcomes in the past and betting that its more likely than not that they wll happen again.

I suspect that having confidence in whatever strategy you use, and the discipline to stick to it, is more important than all the discussion about whether the strategy is 'correct' or not.

We know the % of successful traders is minute, I suspect the % of successful longer term investors is not too good either.

My believe is that its human psychology that gets in the way of the implementation of successful strategies - regardless of whether they are TA, FA, short term, trading, investing, buy & hold, whatever.

I know in my early days I researched all sorts of approaches, I could never get past the logical and mathematical issues I had with TA, so I knew it wasnt for me - because I would never have developed any confidence in a strategy based on it.

That doesnt mean its not a perfect approach for tech/a, pixel or anyone else. I still follow a lot of what the TA guys post because it helps me think about what i do and why I do it.


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## tech/a (17 September 2014)

galumay said:


> I guess if you believe in TA then by default you have to believe that patterns will recur in the graphs you plot and that its possible to gain an edge by looking for events (volume, price changes etc), that have led to outcomes in the past and betting that its more likely than not that they wll happen again.
> 
> I suspect that having confidence in whatever strategy you use, and the discipline to stick to it, is more important than all the discussion about whether the strategy is 'correct' or not.
> 
> ...




Hi G
I've stated many times its not about being right---I'm wrong more often than not and this particular setup wont play out profitably on every occasion---*its about being profitable.*

I'm one of these guys that wants proof just like all of us.
Over 20 yrs I've seen and traded "Proof" all the time.

Being Systems based myself the "proof" that programmed re occurring patterns could be traded profitably on data sets was enough for me to trade and invest. 
But some markets are to be traded and some are to be avoided---this also panned out in systems trading.
Stocks are generally limited to one direction and this along with programmed rules doesn't auger well when trading difficult markets---stocks flounder.

So off to Index Futures I went---trading discretionary patterns that I knew worked.
They still do to this day---are they right all the time---No
But to me the secret to *ANY* trading Discretionary Fundamental OR Technical is your application of analysis to trades to return a profit.


Here we are discussing just one technical setup and its application in real time trading----from tech/a's view point.(The practical application I've presented)


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## rb250660 (17 September 2014)

tech/a said:


> So In cases like a consolidation where we *CAN'T PREDICT* but we can *ANTICIPATE* an increase in positive momentum---you would simply set a conditional buy stop order on how many ever prospects you have.
> This order wouldn't be triggered unless the momentum went far enough to trigger the buy stop.




I'm just polishing a new technical strategy right now based on this exact entry type but it doesn't use building momentum to flag a potential initial (and what we hope to be an) upward move. I works by detecting a recent past move and gets set based off that.


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## burglar (20 September 2014)

Once upon a time:

I accompanied a truckie on a parcel run from Adelaide to Mildura and return.

Having done the shift, we went to a cafe for breakfast.
There were truckies everywhere.

They were discussing shares: Ventracor ASX: VCR, and Unilife

(NOTICE - company delisted
Company code "VCR" delisted as of 01/09/2009 
following failure to pay annual listing fee for the period ending 30 June 2010.)

Unilife,  a company which intended to sell retractable syringes.

Both companies were HOT at the time.
They had Momentum.

T'was like they were following the favourites at the dogs or horse racing.


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## burglar (18 October 2014)

rb250660 said:


> Leave it alone, it was over two weeks ago.




I had waited to get on at 15c. 
It has taken a month.
There were a few tense moments!


Hopefully it has momentum!

Is it too oily to say something immature!!
Toot! Toot!

:


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## pixel (18 October 2014)

burglar said:


> I had waited to get on at 15c.
> It has taken a month.
> There were a few tense moments!
> 
> ...




Assuming you were talking about MEP: That has indeed come down to 15c and found support there.
Momentum is rising, which suggests the support theory; I also find that the (yellow) 1-year EMA line will often mark a support level. The only thing that's still lagging: Volume. But it could be worthwhile starting a small position and adding as buying volume comes in - if it does.


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## burglar (18 October 2014)

pixel said:


> Assuming you were talking about MEP: That has indeed come down to 15c and found support there.
> Momentum is rising, which suggests the support theory; I also find that the (yellow) 1-year EMA line will often mark a support level. The only thing that's still lagging: Volume. But it could be worthwhile starting a small position and adding as buying volume comes in - if it does.
> 
> View attachment 59892




Yes. MEP Minotaur Expl.
They had announced a SPP.
The effect seems to have worn off now.

A good announcement, or two, should see them up and running.
Not very T/A, but I am not fussed.

Not in a position to add, unless the Falcon flies, or the Iron Ore spot price improves.
Wait and see!


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## tech/a (18 October 2014)

Its not showing anything technically---just like a dead fish floating on the surface.


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## burglar (18 October 2014)

tech/a said:


> Its not showing anything technically---just like a dead fish floating on the surface.




I absolutely agree with you ... just like a dead fish!

So why did I buy it?
Because I don't mind being wrong with this one.
The management has proved it can handle a big discovery!
They don't come much bigger than Mt Woods / Prominent Hill.

The share price is acting as I would expect.
The reports are imminent.

My worst case scenario - it may loiter awhile.

My worst enemy might be greed.
I've not conquered my greed in 14 years of trading penny dreads!


So what have I learnt since I fell into ASF ... ?
I am certainly not practicing it on this trade!


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## burglar (21 November 2014)

tech/a said:


> ... a dead fish floating ...




Sinking, floating, sinking, floating!!

I seriously don't know what to do with this one.


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## pixel (21 November 2014)

burglar said:


> Sinking, floating, sinking, floating!!
> 
> I seriously don't know what to do with this one.




no buying volume; 1-year EMA didn't hold; Materials sector dead in the water...

Textbook example in support of *Stop Loss.*




In some cases, stop-lossing may not be feasible - e.g. if one held too many shares, so that selling would move the market to self-destruction. If that applies to you, you may look at the bright side and try to support (possibly even buy into) a break above 15c. For all other purposes however, unless it breaks resistance at 17c and turns it into holding support, MEP is a no-go.


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## burglar (21 November 2014)

pixel said:


> no buying volume; 1-year EMA didn't hold; Materials sector dead in the water...
> 
> Textbook example in support of *Stop Loss.* ...




Hi pixel,
Thanks for your support!
I am not in such a position that selling would move the market to self-destruction.
In fact, I could break-even before brokerage.


But I am not after a dismal result.
I may hold in faith, for a little while longer, like I have done in the past.

"A feint heart never won a fat turkey!"


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## burglar (25 November 2014)

tech/a said:


> Its not showing anything technically---just like a dead fish floating on the surface.




I'm still hoping it's Lazarus fish!


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## tech/a (25 November 2014)

This turned over $9000 in stock today.

Your fish has joined the turkey keen to avoid 
an Xmas dinner.


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## burglar (25 November 2014)

tech/a said:


> This turned over $9000 in stock today ...




I have $3000 in this trade.
I did not buy or sell today.

So none of today's turnover is down to me.

What was I trying to say?

tech/a, I am saying sorry!
You were right, I was wrong.




There! That wasn't so hard.


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## tech/a (25 November 2014)

Wrongs fine.
How long you stay wrong is important.

I've never seen a stock rise or fall on hope.
Seen lots of time and money lost on hope though!


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## rimtas (25 November 2014)

Yea mate, agree, hope will strip you naked...


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## burglar (4 December 2014)

So now I am getting a little flack over my latest trade, Archer (ASX: AXE).

Sure, I used a chart. 
But I did not see any momentum. 
I could not even see a direction.
I imagined it was ranging.

It dipped on that big down day.
I said to myself, that is below support. 
(I told you, I was using a chart)

Next day, the RBA decision and an up day.

Then came the moment.
I would have bought this in an instant based on Fundamentals.
Why would I wait for the momentum?


So why am I saying one thing and doing another?
I don't even know.
I guess old habits die hard!

Why do I feel the need to justify this?
I am having fun with it !!!!


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## tech/a (4 December 2014)

Burgler.

Your showing typical bottom picker tendencies.
You see an up day or two from a new low and 
start kicking yourself thinking you've missed 
the bottom. You start explaining how you were
ready but missed it!



> Then came the moment.
> I would have bought this in an instant based on Fundamentals.
> Why would I wait for the momentum?




*Regardless of WHY*---Fundamental--Macro and Micro economic influence--Emotion charged stupidity----  there are only 2 ways a price will rise OR fall.
Lets look at rise in your case.

(1) Sellers will exhaust---dry up--stop selling--keep holding.
OR
(2) Buyers will buy more stock than is available for sale at a given price.
That doesn't mean you need to see massive volume over coming supply
although that can and does happen. A stock can rise strongly on average 
or even low volume if supply dries up.

So after a 1 c rise in this stock From a test of a support level--- lets have a look

*CLICK TO EXPAND*




From here we need to see 
(1) An influx of volume either drying up supply or pushing up looking for sellers.
I think it would be the latter.
OR
(2) A break above resistance which has good range and fair volume.

What do I think will happen.

More ranging between the current low and 16c


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## burglar (4 December 2014)

tech/a said:


> Burgler.
> 
> Your showing typical bottom picker tendencies.
> You see an up day or two from a new low and
> ...




Never before, have I heard of soft resistance.
So much to learn!


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## tech/a (4 December 2014)

burglar said:


> Never before, have I heard of soft resistance.
> So much to learn!




Its a resistance which hasn't been tested over a very long period of time.
Often revisited over a number of weeks or months.
Generally associated with volume coming into it and showing clear testing.
This is more a level where a high was made over a number of days.
Its soft--likely to be taken out easily d not meaning a great deal f I is.

Where as if the Support is taken out that would be more significant.


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## burglar (5 December 2014)

tech/a said:


> ... Its soft--likely to be taken out easily ...




I was tempted to inject more into these to bring the price up-to 16c seller.
Then I thought, why not let someone else do that, while I wait on the sidelines.

I am still wandering, should I take 16c if both:
a.) the opportunity arises!
b.) the momentum has still not arrived.

I may have a few days to ponder!


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## burglar (8 December 2014)

burglar said:


> ... I may have a few days to ponder!




In the past, I have found *pyramiding* to be counterintuitive for me!
Now I find myself in a position of discomfort.

It may well be the best thing to do.


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## Wysiwyg (8 December 2014)

Pyramid buying works if the stock is trending up while AXE has declined and plateaued. No one interested in pyramid scheme here but there might be some average downers in the mix.



> Why do I feel the need to justify this?
> *I am having fun with it* !!!!




Okay we see your approach now.


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## burglar (8 December 2014)

Wysiwyg said:


> Pyramid buying works if the stock is trending up while AXE has declined and plateaued. No one interested in pyramid scheme here but there might be some average downers in the mix.




Thanks Wysi!

Been in the Average Down Club.
I found to my detriment, that it works until it doesn't work!

Expecting AXE to hit soft resistance this week, hoping for a little momentum.
Too big an ask?


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## Wysiwyg (8 December 2014)

burglar said:


> Been in the Average Down Club.
> I found to my detriment, that it works until it doesn't work!



Even though I know buying stocks in a down trend is a low percentage play, I  am still a sucker for what appears to be a bargain. Did it again about 1 month ago and those stocks are holds underwater for the moment since the All Ords has a flicker of flame.



> Too big an ask?




It's a matter of time really.


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## tech/a (8 December 2014)

A break above 16 c doesn't mean a move to momentum.


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## burglar (8 December 2014)

tech/a said:


> A break above 16 c doesn't mean a move to momentum.




Clear


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## burglar (3 January 2015)

I would have liked to see some momentum (of course)!
I did want to use T/A.

But I have it back to front.
I choose candidate companies first, then wait for momentum.
I have 6 or 7 favourites.

Tech/A has a system which seeks signals for entry.
His candidates already have momentum.

I will not use someone else's candidate.
For one thing, I would not take responsibility for the choice.




Meanwhile AXE Archer Exploration is behaving badly.
Downwards with a lot of noise.






MEP Minotaur Exploration is behaving pretty much as expected.
Sideways with a lot of noise.


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