Forum Archive Index - April 2001

["hugh webber" <hugh.webber@clear.net.nz>]

My experience has been that technical analysis is a total failure 
as a predictor.
For quite some time I used to read Michael Coote's technical column
and graphs in the weekly NBR with some amusement after the comic
strips in the daily newspaper. Given the delays between when it was
written and when the NBR appeared the errors were even more glaring.
I don't know why people keep plugging tech analysis when its a total
failure - there are so many exogenous variables and even in the unlikely
event that a graph continued along an expected path then we have the
day traders coming in to take advantage of it and reverse it.
Can anyone name a single person who's become rich by relying on tech
analysis? Only the people who write and sell tech analysis books to 
suckers.
Value analysis is based on logic and facts and a practitioner knows
that it will be true at some stage although it may take 1 week, 1 month,
1 year, 2 years. It wasn't long ago that the media were laughing at 
Buffett's returns being depressed by not investing in the dot.com
bubble. Nuff said.



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