|  AUG 1988

Real world technical analysis by Kent Calhoun

Real world technical analysis by Kent Calhoun Simplicity and common sense trading methods summarize my approach to technical analysis. The purpose of this article is to educate traders to view price action from a more creative perspective, starting with a return to the basics of technical analysis. In over 20 years of trading, I have tested several hundred trading systems, using computers and manual methods. The common denominator for the most successful systems is simplicity. In this series, I will describe a number of systems, but any trading method or system presented here should be thoroughly tested by the reader before trading in the markets. Role of a technical analyst The philosophy of a technician is that all fundamental information is contained in current price levels, and that price history often repeats itself with distinct characteristics. Charts are people-patterns. What people believe, and how strongly they believe it, is reflected in price, volume and open interest figures. For every buyer who believes the price will rise, there is another person who is convinced the price will fall. Prices, like flowing water and most people, always seek the path of least resistance.

by Kent Calhoun