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Identification through technical analysis: A study of charting and UK non-professional investors

  • Roscoe, Philip
  • Howorth, Carole
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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.

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    Article provided by Elsevier in its journal Accounting, Organizations and Society.

    Volume (Year): 34 (2009)
    Issue (Month): 2 (February)
    Pages: 206-221

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    Handle: RePEc:eee:aosoci:v:34:y:2009:i:2:p:206-221
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