Why Do Technical Indicators Work?
If you distill the force of traders acting on their beliefs down to the most fundamental level, what you will have is simply up- tics and down- tics. A tic is the smallest incremental move in price something can make. A tic would be analogous to the minimum bid at an auction. So each up- and down- tic represents what some trader or group of traders believes about what is high or low at that moment. The accumulation of these up- and down- tics over time can form into price patterns. Patterns form because in any given market, there are usually several traders who share similar beliefs about what is high and what is low. Day after day, they will do the same things over and over again to make money. All of this activity creates behavior patterns. More specifically, groups of individuals can generate “collective” behavior patterns no different than any particular individual who will behave exactly the same way in certain circumstances and situations. These collective behavior patterns are o
Related Questions
- How are successful behavioral and performance indicators for KSAs and technical competencies not in this model identified?
- I currently use several technical indicators in my trading. Can I continue using these indicators when I use WindoTrader?
- Does SMR Pro include any technical indicators besides the SMR oscillators?
