Trading with Charts for Absolute Return

Final Remarks

Reaching out for absolute return results is a tough issue. Only few investors get there. One way to produce positive trading results from year to year is to work, in our opinion, with chart patterns.

Meaningful advantages of chart analysis on stocks that will count more than anything else to investors who work hard for their performance, however, are simplicity, lack of optimization, and historical test results being identical to future results as long as the same patterns are used that were profitable in the past.

All of the problems created for fundamental analysis by globalization (meaning investing in stocks in the United States, Europe, Asia, and South America) will be solved as soon as the analysis based on chart patterns works on every single stock around the world.

Investors’ behavior is as stable in the United States as it is in Europe, Asia, or South America, which means that chart pattern analysis works irrespective of country-specific differences regarding the stock data analyzed. Reliable trading signals are generated as long as there is sufficient volume in the stocks and a stable amount of volatility.

Making money is a strategic game, not like going into a casino and playing roulette. The best trading signals do not help if the strategy to work with them fails.

There is a significant difference between optimism and overconfidence. People have to be optimistic; otherwise they would never take any risk at all. Optimism combined with the necessary knowledge ...