How Time Matters to the Market

Michael N. Kahn, CMT

Time is one of the more underutilized facets of technical analysis. It may march steadily onward in only one direction and in defined increments, but there is much to be gleaned from it. How much time did the market spend in its trend? Is the small trading range now long enough to allow for the excesses and imbalances built up during the trend to dissipate?

Momentum is also based on time, even though the calculations used to measure it do not depend on it. The concepts of overbought and oversold center around markets that move too far, too fast, and that last term is completely time dependent. A rally of a stock from 10 to 100 can take place over a one-month period or a three-year period, and ...