If you're jumping from one TA to another

Found this article somewhere thought might be relatable pasting it here

Why i was an advocator of TA and the biggest criticiser of it as well.

Introduction

I will take you through a phase which pretty much every trader/Investor will go through at least during their initial journey in the financial markets, given the fact that a lot of people are lately entering into the markets, I keep hearing people about using technical analysis to make money off the markets,

Why you should even listen to me

I was an advocator for technical analysis because for the most part I believed it’s the key to making money if you don’t know anything about fundamental analysis, I used to spend at least 7-8hrs everyday watching charts for almost 2 years out of my 4 year journey so far.

I went through auction market theory, market structure, price volume rotations, Wyckoff theory, So called smart money concepts, Finished ICT course and mentorship for 6 months, Turtle trading strategy, Quasimodo, trend analysis, Fractals. CMT level 1 as well along with this decided to check out courses provided by famous course sellers like “havenspire” and “cosmic wealth”, which basically sells you free stuff packaged to make it sound smart.

I was but of a nerd in the technical analysis community, Developed my own TA strategies as well, I tested the concepts I mentioned above extremely rigoursly for 2 years, in different markets, forex, equities. Most of these strategies will work well if you do it in forex or US markets because how developed their markets are compared to Indian markets, Not to mention our total daily volume is nothing compared to forex’s $6.6 trillion per day average , hence the liquidity gap is quite big

My analysis and experience

Over the years I realized technical analysis works when its famous and other people do it alongside with you, Try doing SMC concepts in forex? it works well there cause most people who trade forex uses it, try to do the same in Indian equities , you will not get same outcome. Ask yourself this question, Why does it work so well in currencies market or US markets, whereas if u try to do the same in any stock excluding nifty 50, it will struggle. Only in nifty 50 most of these concepts work decently ok because it has enough volumes and participants. Our markets are simply very underdeveloped ,

-as on 23rd Feb 2024, DII net value bought was around 176 crores, whereas FII/FPI was 1276 crores, you can only imagine what would be the retail portion out of this data , Just mere few hundred crores maximum. that’s it , for reference retail pie in NSE according to latest data is around 7.62% only. In easy words, out of 2,113 listed on NSE, Cumulative holding of every single retail will account till 7.62% according to primeinfobase.com

-Approximately 3% of India’s population is currently invested in the stock markets whereas About 58% of U.S. households owned stocks in 2022, that number has recently increased to 61% in 2023. according to WSJ and statista .

-there’s a reason why analysing SGX nifty and US markets will give u better prediction if the index if going to open gap up or gap down

Theres a reason why we see movement when European markets start opening during afternoon.

Idiot admires complexity , Genius admires simplicity

Theres no golden trading technical analysis strategy, Its all about what you want to believe in and what suits your style, IT doesn’t mean you have to choose the most complexing looking strategy out there or go through 20 books , over 70 GB worth of content and spend 5-9 hrs daily just analysing charts like I did, what I did was a mistake, an idiot admires complexity whereas a genius admires simplicity

Even if you Mark previous day close high open low on the index, and trade alongside confirmation bias candles like pinbar or engulfing, u will do better than most people who are busy drawing trendlines or wyckoff schematics , just an FYI , wyckoff was never about schematics, if someone has read a book by Ruben Villahermosa , you will realize wyckoff is understanding how price behaves in a phase, understanding phase is important, not trying to mark where is up thrust or ChoCH

Risk management systems

All you need is observational skills, Understanding psychology behind a candle, simple OHCL levels and Risk management system is more than enough

you don’t need to learn everything out there and waste your precious time and money , Always back test what you are doing , you can try streaks or you can manually figure out win% rate by calculating your recent 100 trades , anything greater than even 30%, you are doing good, trust me.

I am sure you must have heard this a lot, but a simple coin toss has higher probability of generating returns 50/50 than most TA strategy, Susquehanna International Group has statistical arbitrage desk, market making desk ,risk arbitrage desk but they don’t have TA desk, Ask yourself when was the last time you found a job opening for Technical analyst as compared to a quants analyst ? Who earns the big bucks and why? . its all about stats and risk management in the end, Not what Morning star evening star candle got formed , you are just doing astrology at this point.

You don’t need to watch hundreds of YouTube videos cause 90% of them are garbage, in its true essence most strategy are trying to tell you psychology behind the price movement, nothing more.

Just believe in your own observational skills and refine it time to time use TA for Execution End when taking a trade, Don’t make it your entire deciding bias for a position.