It was never my objective to create a completely generic web site that covers the same material you can find everywhere else, there is much to trading that I am deliberately omitting for now because I don't think there is much to gain from creating yet another technical analysis web site.

In the links section of this FAQ there are a great many good sites that deal with technical analysis and in the reading section there are a few detailed books mentioned, Technical Analysis of the Financial Markets by John J Murphy being one of the better ones.

If there are a thousand sites out there with detailed accounts of how to use technical analysis, I see no reason at all to write another one. If you want to learn about chart reading and indicators, read the books I mention in the trading section and the sites from the links section, they cover this stuff in plenty of detail. (Or just type "technical analysis" into a search engine, you'll get all the chartist stuff you can read).

The material I have included in this FAQ is much harder to find on the web, and the books that deal with the subject typically don't appear on the bestseller lists as they make most amateur trader's heads hurt. If you put the terms used here into search engines you won't find much of any direct usefulness to traders, I have had to wade through heaps of that stuff to find anything useful, often enduring complicated mathematics as well as hulking great loads of futures spam and extensive archives on blackjack and other gambling. I also had to go to various university and reference libraries to look up books that aren't usually found in your local suburban library.

I am firmly convinced that most amateurs prefer technical analysis because it is easy to use, especially compared with the detailed analysis of company accounts and business economics needed to achieve good results from fundamental analysis. It takes days or weeks of hard work to decide based on a thorough fundamental analysis if a stock is worth buying or not, but a chartist can buy based on a quick glance at the trend.

Of course professional traders are as far above the amateur speculators as the professional investor is above the guy that buys a stock just because he thinks the price/earnings ratio is attractive. Professional hedge fund managers do not dabble in speculative penny stocks drawing funny lines and boxes on a chart, they use advanced knowledge of money management and risk management as well as sophisticated quantitative techniques. It wasn't my intention to produce a FAQ on advanced hedge fund trading techniques, but perhaps to produce something that bridges that gap and gives you information somewhere in between the chartist and the professional trader.

I have based some of what I have written on talks with traders that I know, and they say I'm on the right track. If any reader has material to add to this FAQ, or constructive criticism, I'm all ears.