Forum Archive Index - September 2003

[Stephen Judd <sljudd@paradise.net.nz>]

On Thu, 2003-09-18 at 22:19, Dave Missen wrote:

> In saying this I don't discount the benefits of TA, I do agree with the
> comment that the model needs to be reconsidered, but as with all things in
> economics the model that is being used is attempting to quantify
> market/human behaviour which is often at best irrational.

The argument that resonates with me most runs like this.

Suppose that TA (or any other strategy) provides a significant
improvement over other strategies. As soon as this becomes apparent,
everyone will use it. Once everyone uses it, the "signals" no longer
apply, since people's behaviour will change. So any advantage will last
only as long as it takes to be widely known.

Note this doesn't deny that a given TA approach could work or be useful
at any time, and it doesn't say how long it might take to be ineffective
- that would depend on the speed with which people learn new patterns
and act on them.

Another consequence is that there may be an absolutely killer, long-term
reliable TA strategy out there - but whoever has it is keeping it to
themselves.

:-)

Stephen


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