# Technical analysis and speculative stocks



## beaul (23 January 2010)

I am new here. 
When trading on speculative  mining stocks eg. I would imagine most traders would be using Technical analysis. 
In other words a high proportion of traders would be using similar methods to analyse the stock. Playing the same trend? and setting similiar stop losses at a similiar level etc.
I would like to hear comments from experienced traders.


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## brty (23 January 2010)

> In other words a high proportion of traders would be using similar methods to analyse the stock. Playing the same trend? and setting similiar stop losses at a similiar level etc.




No, that is what newbees, losers and amateurs would be doing.

brty


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## beaul (23 January 2010)

Well, tell me how you do it.


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## brty (24 January 2010)

It is often stated that 90% of traders are losers, I believe the figure to be higher . Because trading is a negative sum game, then it is easy to believe there are many losers.

How to be in the winners camp is by doing the opposite of what the common thing to do is.

When I buy something, should I expect the position to be correct or incorrect?? Most will say silly question, you only buy when you think it is correct. I assume my positions to be incorrect until proven correct. Hence I am prepared to close out positions that have not reacted correctly by not waiting for a stoploss to go off.

Try to think differently when looking at patterns, think outside the square. Buy when everyone and everything looks to be a good sell. Buy where you think the stoploss should be, sell when everyone has climbed aboard the bandwagon.

brty


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## beaul (24 January 2010)

Thank you, BRTY, I am beginning to get the picture.


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## Wysiwyg (24 January 2010)

beaul said:


> Thank you, BRTY, I am beginning to get the picture.



You wouldn't think it would be so difficult for something that only goes up, down or nowhere.


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## beaul (24 January 2010)

Because at this end of the market (spec. mining stocks) with so many stocks going nowhere and with very little Financial information (fundamentals) available, the only way to go is to follow a trend which is the essential training of technical trading. 
Ok, after this point we can develop our own style of dealing with the stock, but it must start with trending?? or insider trading??
Comments please.,


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## Sean K (24 January 2010)

You can trade short, medium and long term technicals on any speculative stock. Higher risk, but higher reward. For example, when a low cap spec breaks out to the upside it could rise dramatically. Multi bagger stuff. Same to the downside. For a major, a technical break can just mean just a couple of percent. Either way. Take your bet.


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## Trader Paul (24 January 2010)

Hi Beaul,

Following the trend is only a small part of technical analysis
and to solely rely on the trend will cost you lots of time and 
money, if you do not have an exit plan ... again, following 
the trend blindly, will cost you in cash and other lost opportunities.

Fact is, most traders rely on analysis of information, generated
by the price action, alone ..... and price action is only 50% of
the information available in ANY chart, be it a spec miner or a
blue chip, it matters not ..... 

..... aside from the price axis, there is also a time axis on any
chart, that can further aid in our analysis of ANY stock.

Knowing WHEN to enter and exit a trade profitably is the goal
of all analysis, technical or fundamental ..... so, using ALL the 
information available to us, in any chart, has to result in better
technical analysis, overall ..... 

..... so, what will the time axis tell you, on your next chart ... ???

have a great day

  paul



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## Sean K (24 January 2010)

Trader Paul said:


> Fact is, most traders rely on analysis of information, generated
> by the price action, alone ..... and price action is only 50% of
> the information available in ANY chart, be it a spec miner or a
> blue chip, it matters not .....
> ...





Fact is, no one can time the market. Especially those aquanted with EW or Gann.


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## satanoperca (24 January 2010)

Agrees with Trader Paul.

Time and time lines are critical in analyzing a chart. Whether it be 10min, 1hr, EOD, Weekly or Monthly.

A simple example of this is the XAO chart on EOD and Weekly. 

On EOD not divergence was detectable on any indicator for the recent reversal.

Switch to a different time frame, weekly and bearish divergence is on every indicator, MACD, SKOL, ROC, RSI. 

Cheers


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