Identification through technical analysis : A study of charting and UK non-professional investors
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The usefulness of technical analysis, or charting, has been questioned because it flies in the face of the 'random walk' and tests present conflicting results. We examine chartists' decision-making techniques and derive a taxonomy of charting strategies based on investors' market ontologies and calculative strategies. This distinguishes between trend-seekers and pattern-seekers, and trading as a system or an art. We argue that interpretative activity plays a more important role than previously thought and suggest that charting's main appeal for users lies in its power as a heuristic device regardless of its effectiveness at generating returns.
Roscoe , P J & Howorth , C 2009 , ' Identification through technical analysis : A study of charting and UK non-professional investors ' Accounting, Organizations and Society , vol 34 , no. 2 , pp. 206-221 . DOI: 10.1016/j.aos.2008.05.003
Accounting, Organizations and Society
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