I'll prove TA works

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jesse

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Post Number: 1
Registered: 06-2005

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Thursday, June 02, 2005 - 07:00 am:

Not hard to believe there are so many doubts with regards to TA. Too many systems and scammers. Stick to the old school TA and you will not go wrong.

For example... The gold market. Fundamental analysis says there is an inverse relationship to the dollar. Dollar has been rallying on the EU news, gold has been dropping. Fundamentally that is normal.

Gold stocks are moving higher. How can gold stocks move higher when the physical metal is dropping. Fundamental analysis says that if gold is dropping, earnings of gold stocks will drop, right? Therefore gold stocks should be moving down also.

Chart tells me gold stocks move higher. Gold stocks have been in rally mode for two weeks. Gold just made a new low, what gives? TA says the bottom was hit and moving higher, load up on gold stocks.

TA showed underlying strength in gold stocks. Showed on the chart a reversal. My gold stock calvf was up 15% today, cde was up 5%, gold was down $1.20, dollar rallied hard. Hmmm.

The weekly chart shows me a new bull leg is starting in the gold sector. The xau is stuck in a trading range, currently at the bottom of the trading range, means we are moving up to test the top of the trading range.

Is there a stronger demand for gold? I dont know, fundamental analysis is late, too late. I use both TA and fundamental analysis.

I've used the example of a commodity but the same holds true for all stocks in all time frames, intraday, daily, weekly and longer term.

All based on investor psychology which is what moves the markets... xau Weekly