Charts
Examining charts is a long-standing fixture of modern finance. For example, we have all seen “scary charts”, which often spread like viruses. One example is the following (first chart). But as Matthew O’Brien pointed out, the scary parallel pretty much disappears if one scales the two charts properly (second chart):
Technical analysis
Charting typically goes hand-in-hand with “technical analysis,” namely the usage of relatively unsophisticated analysis schemes, typically computed from high-level statistics on stock market data. The field has its own terminology, as exemplified for example by a recent report in the Concord Register: parabolic stop and reverse
Continue reading Charts and technical analysis: Do they work?