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The power of technical analysis is that price movements hide nothing. One of many examples that I have sited on my courses was Palladium. This chart to a technical trader is superb. My attention was drawn to it because of a headline that I noticed on the back of a fellow passenger's newspaper on the tube. The headline read:
"SUPPLY FEAR LIFTS PRICE OF PALLADIUM"
The sensationalist nature of the print suggested to me the bull move was over as it said "panic" (not a good reason to trade) and when I analysed the chart, it confirmed my suspicions. The date of the headline occurred as annotated on the chart below. Shortly after the market moved into a classic reversal pattern and in the March 2000 course it became one of many perfect examples of a key topping sequence and subsequent market correction, which we observed and predicted in real time.
Palladium - Fear leads to anger, anger leads to hate, hate leads to losses...
| Introduction | |
FAQ | |
Learning | |
Experiences | |
Attitudes | |
Case Study |
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