WILL THE CAMEL GO OFF THE CLIFF INTO THE
‘SPLAT ZONE’? I have always found it bizarre that buy side Asset Managers only care that you know your fundamentals and hold a CFA. Technical analysis is largely either unknown or regarded as some sort of wizardry or cosmic skill - or worse still, just drawing random lines on charts.
I recently asked a Portfolio Manager from a large well-known Asset Manager if he employed any technical analysis to make decisions when investing in stocks. “Oh no, not at all, we only use fundamental analysis” replied, “of course, we do that to help with the entry!” I then asked “isn’t
Frustratingly there is so much confusion about what technical analysis is and what it should be used for. I think things are probably not helped nonsense.
USING TECHNICAL ANALYSIS IN CONJUNCTION WITH FUNDAMENTALS CAN GIVE YOU THE MUCH-NEEDED ALPHA THAT EVERY PORTFOLIO MANAGER SEEKS.
Source: FT -
https://ftalphaville.ft.com/2018/04/19/1524110400000/The-Vomiting-Camel-has- escaped-from-Bitcoin-zoo/
Source: STA Market Technician No.85 Chart 2
Recently FT journalist, Katie Martin for a joke tweeted out some charts with crude pictures of a camel vomiting on them. Unbelievably CNBC picked up this as a technical ‘pattern’, called it a VCP (Vomiting Camel Patten) and applied it to a Gold chart. “Will the camel CNBC anchor. See the ‘charts 1 and 2.
FT Bitcoin ‘VCP’ Chart 1 and CNBC Gold ‘VCP’ Chart 2.
Whilst this didn’t help the cause of technical analysis much, it is still quite amusing and is more of a tale about human behaviour. We recently presented Katie Martin with a toy vomiting camel at the 50th birthday of the Society of Technical Analysts (STA).
Chart 1
34 | ADMISI - The Ghost In The Machine | March/April 2019
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