1
SCIENTIFIC RESEARCH TECHNICAL ANALYSIS!
ESPEN GRØNSTAD CEO – INVESTTECH
WWW.INVESTTEH.COM
Copyright © 2013-11-20
• Norwegian company established 1997
• Based on scientific research
• Solid documented results
• Independent and objective analyses
• Subscriptions: INVESTOR
Investtech AS
Stock analysis
3
• Fundamental analyis:
Security!
• Technical analysis:
Timing!
Depression
Skepticism
Optimism
Greed
Denial
Pessimism
Fear
Depression
Greed
Market psychology
2006 2007 2008
“It's not whether you're right or wrong that's
important, but how much money you make
when you're right, and how much you lose
when you're wrong”
- George Soros . 5
Mindset
6
Technology
2
7
Mindset
8 8
Trends
Rising trends
Neutral trends
Falling trends
Trends
1-6 quarters 6 years Long term
1-6 months 8 months Medium term
1-6 weeks 5 months Short term
Investment horizon Chart Time horizon
10
Signal from Trends
?
11
Signal from Trends
Average price development five days
before trend signal and one year after
trend signal for Norwegian stocks in the period 1996-2009.
20,0%
12,3% Index
5,2%
Buy signal
Sell signal
Trends – help
3
Support and Resistance
Support
Resistance
Resistance
Support
Support and Resistance
Support and Resistance Formations
Rectangle
Double top/bottom
Head and shoulders
67%
17
Top formation
Oslo Børs 14. January 2008
18 18 18
Bottom formations
OMX Stockholm 30 - 30 April 2009
4
19
The theory says that the price will reach the objective within L days.
• How often does this happen?
• Can this be used in a trading strategy?
Investtech – Research report
Results:
Investtech – Research report
Success pecentage after one formation length (1L)
1,088 rectangles identified on the Oslo exchange 1996-2008. Average: 13.4 % height, 98 days length
21
Formations
22
Volume
• CONFIRMS OR WEAKENS TREND DIRECTION, BREAKS THROUGH SUPPORT/RESISTANCE, AND SIGNALS FROM FORMATIONS
• INDICATES COMING TREND BREAKS/SIGNALS
• TRUST
• UNDERESTIMATED AS TECHNICAL INDICATOR
23 23
Volume
Supply
Demand
Price
Volume
Volume
Negative volume Positive volume
5
Volume Technical analysis
Positive trend
Buy signal from
formation
support
Near support
Technical analysis
Medium
28
www.investtech.com
6
31
Research report Solid excess return with the Daily Case
33
www.investtech.com