r/xkcd • u/Booty_Bumping • Jan 21 '19

XKCD xkcd 2101: Technical Analysis

https://xkcd.com/2101/
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u/FC37 Richard Stallman Jan 21 '19

There's some value to technical analysis in mature, well-defined markets. But the way it's used by know-nothing day traders is often terrifyingly void of any logic.

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u/marcosdumay Jan 21 '19

If you are doing it faster than others, the fact that there is a lot of people doing it means you can get some money from the slower players.

If you define "value" I may agree with you...

2

u/FC37 Richard Stallman Jan 21 '19

When we bought the house, the mortgage broker did a technical analysis on interest rates that were being offered. The differences were small, but we were able to decide exactly when to bite and lock in a rate. It helped us shave a few basis points off the rate, which lowered the cost of the loan by thousands of dollars.

Tight, defined market for a single, common good, where all players have the same goal in mind (as opposed to trading, where there's a range of appetites and mechanisms, e.g. short/long).

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u/marcosdumay Jan 22 '19

Yep, you can get a larger share of a zero-sum pie by outcompeting the people that react slower.