CHARTS

"A chart can show you what has been going on, and if this differs from what you think ought to be going on, maybe you ought to think again, even if the future is not there in the tea leaves. The assumption of the chart is that you ought to pay attention to it because the people who have already acted, and therefore created the chart, are smarter than you, or know something you don't know. You may reject the assumption, but it's a good check." Adam Smith, The Money Game 1968

"Totems may be superstition, but if superstition is part of the scene and the exercise is to anticipate the actions of the crowd, then knowing the totems must become part of the anticipation." Adam Smith, The Money Game 1968

"I absolutely believe that price movement patterns are being repeated. They are recurring patterns that appear over and over, with slight variations. This is because markets are driven by humans — and human nature never changes." Jesse Livermore

"I am a great fan of keeping charts. They tell you a lot in a hurry about a company or a trend or how your investments are doing." Roy Neuberger

“While our portfolio decisions are driven by fundamental analysis, we certainly do not ignore technical and quantitative analysis, which have come into vogue once again.” Lee Ainslie

"To trade well, you need to understand the fundamentals, the technicals and the market segment you are investing in." Sir Michael Hintze

“For me, technical analysis is like a thermometer. Fundamentalists who say they are not going to pay any attention to the charts are like a doctor who says he’s not going to take a patient’s temperature.” Bruce Kovner

“I never use valuation to time the market. I use liquidity considerations and technical analysis for timing. Valuation only tells me how far the market can go once a catalyst enters the picture to change the market direction.” Stanley Druckenmiller

“It is very important for me to study the details of price action to see if I can observe something about how everybody is voting. Studying the charts is absolutely crucial and alerts me to existing disequilibria and potential changes.” Bruce Kovner

“Any time I get into a position, I’ll look at the chart first. I always default to the chart. It is critical for entry points.” Steve Cohen

“There are many more deep intellectuals in the business today. That, plus the explosion of information on the Internet, creates an illusion that there is an explanation for everything. Hence, the thinking goes, your primary task is to find that explanation. As a result of this poor approach, technical analysis is at the bottom of the study list for many of the younger generation, particularly since the skill often requires them to close their eyes and trust price action. The pain of gain is just too overwhelming to bear.” Paul Tudor Jones

“Charts are extremely important. One of the best patterns is when a stock goes sideways for a long time in a narrow range and then a sudden, sharp upmove on large volume. That type of price action is a wake-up call that something is probably going on, and you need to have a look at it.” Joe Vidich

“To use a sailing analogy, the wind matters, but the tide matters too. If you don’t know what the tide is, and you plan everything just based on the wind, you are going to end up crashing on the rocks. That is how I see fundamentals and technicals. You need to pay attention to both to make sense of the picture.” Colm O’Shea

“Charts are trading tools and not useful for price forecasting. Over the years, I have been extremely amused by ‘chart book economists’ who are constantly reinterpreting the fundamentals based on the latest twists and turns of chart patterns.” Peter Brandt

“Charts are very important. Once I have done the fundamental work and decided to buy a stock, I will first look at the chart before putting on a position. If the stock is very overbought, it won’t stop me from buying, but I will start with a small position because there is a larger chance of a correction.” Martin Taylor

“While I spend a significant amount of my time on analytics and collecting fundamental information, at the end of the day, I am a slave to the tape (and proud of it).” Paul Tudor Jones

"Technical analysis can be a very powerful - and profitable - predictor of prices over short time periods in narrow segments of the market. The reason the professors missed this is far more important than the fact that they missed it. They were required by their own protocols to exclude the very force they were investigating - the power of human judgement to create entrepreneurial profits." Andrew Redleaf 

"I do believe in the black magic art of technical analysis." Stanley Druckenmiller

"Do I also look at charts to help me in making buy decisions? I do. I'd never buy a stock solely on the basis of its ‘breaking out’ or anything of that sort, but a chart is a handy, shorthand way of checking up on what's been going on in the stock. If you see a stock has doubled in the past six months, you're probably too late." Ralph Wanger

"Charting is a little like surfing. You don't have to know a lot about the physics of tides, resonance, and fluid dynamcis in order to catch a good wave. You just have to be able to sense when it's happening and then have the drive to act at the right time." Ed Seykota

“As for when to buy, I mix some barebones technical analysis into my strategy -- a tool held over from my days as a commodities trader. Nothing fancy.” Michael Burry

“Charts represent possibilities, not probabilities and certainly not certainties. Analogues represent possibilities. If you can't accept this, then do the world a favor & donate your money to a charity before you lose it. Different markets, different time frames.” Peter Brandt