Technical Analysis

The use of technical indicators

Many investors study the movement of and the statistical properties of market prices and volumes and base their decisions upon such technical analysis.

A Typical Technical Analysis Investment System

  • Enter a long order when the closing price of the stock is greater than the 30-day simple moving average of the closing price.
  • Close a long order when the closing price of the stock falls below the 10-day weighted moving average of the low price.

The construction of an successful investment system is often time-consuming and must be performed periodically as market conditions change. Furthermore, a system which works well for one stock may not be profitable for another stock.

Because of the number of possible indicator terms multiplied by the number of variations of each indicator, a genetic programming search may be efficiently employed to quickly find investment systems.