Ildar SadykovPublished in:
Global Markets and Financial Engineering (Russian version)
– Volume 2, Number 3 (July-September, 2015)

JEL classification: C55, G10, N22

Keywords: exchange, indicators, price changes, sales strategies, shares, technical analysis, trend reversal patterns


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Abstract:

This study reviews options for the empirical analysis of sales strategies based upon methods of technical analysis that use both wide-spread indicators (such as moving average options, MACD, DMI, ADX, envelops and feed) and the special technique for analysis of trend reversal span. This approach has allowed to perform the cluster analysis of invariants that show signals of the possible trend reversal. The uniqueness of the research consists, first of all, in its scope. The analysis included all the shares traded on the exchange at the studied period. At the second, it is multivariance of calculations based on the analysis of dynamic features of points preceding and following trend reversal. The results of calculation experiments showed that during the studied period the market underwent uncontrollable fluctuations that did not allowed to identify sustainable trend reversal patterns in the dynamics of shares that would be the basis of the successful sales strategy.

Highlights:

► the existing stereotype of understanding restricts the ways of developing an efficient trade strategy
► trade strategy is a knowledge rather practical than theoretical, hence it can’t be described to the full extent by formal (mathematical) methods only
► the analysis of the structural tensions by the disproving method will provide an important information about the accumulated distortions in the trade strategies developed based on the traditional indicators

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