Comments on technical analysis before computers, the change over to computers, and more!
I saw this in the comments, its from Marcus, a trader here in Australia
Not only did it remind me of the olden days (Computrac!) its a great piece.
its in response to a question on the Soros GBP trade from Grasshopper (thanks grasshopper!):
marcus, if i may pick your brain... as TA at the time, what was your fav technical approach? what is it today, if any?
Marcus suggested I title the reply "Dinosaurs of the lost Ark".
At the time I had a very labor intensive approach. I had hand drawn charts of all the major currencies in an Hourly, Daily and Weekly format.
In 1983 when I started my TA journey I studied all the known methods at the time..ie Elliot Wave, Gann Angles, and my favourite book of pattern recognition was the book by Edwards and Magee. I also liked using point and figure charts.
As computers came on board I then looked at all the usual statistical approaches ie stochastics ,MACD, Rsi's. First program for charting was Computrac a $2000 software program that came in about 6 floppy disks haha.
Today I still hand draw "some" charts but obviously the power of a computer is too hard to resist although I don't believe it gives you the same feel for the market.
I crunch a lot of numbers through Excell coz I like looking at numbers basically.
I try and put my own slant on the indicators in my pursuit of some small edge and find quite often that the best buy signal comes when all the indicators are telling you to sell and vice versa..don't ask me why it just happens. Try to keep it simple these days.
At the time of the GBP sell off every indicator in every time frame was Overbought Stochs over 90 rsi in 90s. That was with cable around 1.90 level I think it might have got to 1.94 before finally falling over. I had seen the exact same thing In the Ozzie dollar and watched it plummett from .8960 back to .65 cents
