The way I look at it is this: If graphs and charts can supposedly predict the stock market's movement accurately, why are we not warned of the countless market crashes?
Look at today's PhilipCapital technical analysis:
"The current rally we are seeing rose from a bottom that took 3 months to form and it is thus unlikely that it will end in 3 months – generally the time taken for the market to rally is longer than the time taken for it to consolidate. However, the current rally has lasted for 3 months straight and we are currently due for a technical correction.
The intermediate trend is still up, but the short term is currently trending down – a healthy correction. "
I do not understand the meaning of "intermediate trend is still up, but the short term is currently trending down".
This sentence will always hold true. If market recovers tomorrow, it shows the IMMEDIATE trend is still up. If market continues to fall tomorrow, it shows that the SHORT TERM trend is currently trending down.
WOW! That's as good as saying the market will either go up or down tomorrow.
I am confused as I can interpret it in another way:
Assuming similar movements form a trend.
For the past one and a half week, STI has been trending down daily, which is the "immediate trend" (not up). Hence, the short term trend is currently trending down.
So which part of the sentence is false and/or true? Unless "trend" in the same sentence denotes different meanings, I seriously find it difficult to understand the technical analysis!
That's why I say, technical analysis is not for me.