There is a trading saying..."Feed the ducks when they are quacking"...refers to selling into FOMO buying surge.
I'll try to get this topic back on course after many threads of diverging into something else. The Corona-virus was actually was predicted by AI before the CDC @ https://www.beckershospitalreview.c...ronavirus-outbreak-a-week-before-the-cdc.html Therefore, the real issue would then have been if you're astute enough to properly place your long term trades and/or investments via that prediction ? The situation with Iran was also predicted by AI after it analyze all the data before that situation happen. Once again, were you in the position to have access to that info and then use the info to properly place your long term trades and/or investments via that prediction ? I'm in the camp that you can not use technical analysis alone without help from other data or market context variables. Would you have had deep enough pockets to manage the counter price reaction until those predictions were able to come to full bloom ? My point, there's more to it than just predicting global events...you still need to do your part as a trader (short term or long term) and investor to be able to exploit what ever was predicted because technical analysis does not predict global events (never has). Simply, if you're trying to use technical analysis to predict global events...you've already used it a way it can not be used nor designed to be used. Another way to look at it...your reaction to technical analysis as if it should have "predicted" the way the markets are going to react to something like the Corona-virus is you having the inability to trade it properly. Sure, probably most here didn't predict it too but very few or maybe none of them are blaming it on technical analysis. Lastly, I didn't see any messages by anyone stating that their technical analysis predicted Corona-virus nor that their technical analysis predicted the outcome of the markets reacting to the Corona-virus. If you have seen something like that...please quote it because I have not seen such. In contrast, I've seen many message posts by someone using technical analysis to exploit the market reaction (Up and Down) to Corona-virus. Thus, I've seen people say their TA is predicting lower prices in airline stocks, futures and in global markets. In contrast, I've seen people say their TA is predicting higher prices in global stocks. Someone will look like an idiot and someone else will look like a genius in predicting the market reaction to the Corona-virus. wrbtrader
Put these 2 things together... 1. Technical analysis can't predict global events. 2. Global events are the #1 force that drives markets. You get... Technical analysis can't predict the main forces that drive markets. That was my point. I never claimed that TA was capable of doing this.
Actually, you've been debating as if someone (unnamed by you) has used technical analysis to predict global events...in reality, it was AI that predicted such. Every trading day...something is the #1 driving force in the markets and something else is the #2 driving force, something else is the #3 driving force and so on. Yet, I'm sure (never denied it) global events is the #1 driving force on some of those trading days and the #2 driving force on other days, #3 driving force on other days and so on. Hopefully, you get that. Simply, we have similar views but I'm not complaining about it. wrbtrader
I'm not sure that TA (which could mean a million different things) is ever #1. I've certainly never seen proof of it.
I have not seen proof of it too being #1 nor have I've seen anyone say its TA that is the #1 reason and why would it matter if its #2 reason or #10 reason or #50 reason...you can't measure it. Which is why I asked you to name one person that you can quote that stated the markets did what it did because of TA. I myself have not see any posts, messages, blogs, forums like that. Thus, because its not measurable...why does it matter to you ? The markets are impacted by many reasons...sometimes many different reasons at the same time especially when global economies are ever more connected. wrbtrader
Meanwhile, there have been great short signals this morning on the ES. Do I care why?...no, it may be the Corona virus causing climate change leading to impeachment charges...whatever. Have a plan with viable signals and trade your rules.
But a hedge is an insurance vehicle to moderate price fluctuation risk. Speculation is another animal.