Social technical analysis
Definition Social technical analysis
Social technical analysis is a method of sharing technical analyses among members of a trading community. It is practised on all financial markets (Equities, Indices, Forex and Commodities). Social technical analysis should not be confused with social trading, which aims to copy transactions made by one trader. Social technical analysis aims to suggest trading ideas and to compare the vision of different traders on different products. Everything is based on the quality of technical analysis and not on portfolio performance (as is the case with social trading). There is total transparency, each trader expresses his vision of the market by putting forward technical arguments in favour of increasing or decreasing a product. This is what our CentralCharts site offers, specialization in social technical analysis.
Advantages of social technical analysis
- You are your own boss: Unlike social trading, social technical analysis allows you to remain the decision maker on your trading account. You choose the transactions you make. It avoids unpleasant surprises, and if you lose, you can only blame yourself.
- It's free of charge: All analyses on CentralCharts are freely available without even becoming a member. This is not the case with social trading. On platforms that offer this service, spreads are higher to enable traders, who provide their signals, to be remunerated. (This commission perverts the social trading model that pushes signal providers to place a large number of transactions).
- The analyses are diversified: Unlike every other signal service that you can find on the net (and that are not free), technical analyses comes from different analysts who each have their own method of analysis. There is something for everyone (trend trader, against the trend trader, short term trader, long term trader, etc.).
- It enables you to have a complete overview of a product: Product analysis is available for each time unit, enabling you to have a global view. Whatever the unit of time you have chosen for trading, there is something for you.
- You improve your technical analysis skills: Whether you are a novice or an experienced trader, analyses of other traders offers you different trading strategies than yours (none is better than another. What makes a strategy good is the way it is exploited.) For novice traders, it is a way to see the analysis methods of more experienced traders. For experienced traders, its can help develop their analysis method to make it even more efficient.
- Ranking on each product/market: The CentralCharts tool provides a ranking of the best analysts by product and market. This enables you to identify the most relevant analysts on the products you are trading.
What not to do with social technical analysis
- Copying a trader without thinking: Copy yes, but only if it is in accordance with your strategy. You should never blindly follow a trader on the trades he makes. Social technical analysis is carried out to give you trade ideas but don't forget that you are the decision maker on your trading account. If you really believe the analysis is relevant, you can follow it. But if the analysis is based on a different method of analysis than yours, or you have a doubt about the analysis, do not open a position. You must always complete the analyses with your own analysis. Social technical analysis is carried out to give you some hints, not to think instead of you!
- Criticize after the fact: Some people criticize an analysis if the opposite scenario occurs. This is something that we see regularly (fortunately not on CentralCharts) on traditional forums. The fact that an analysis’ scenario does not occur does not make it a bad analysis. You can do the best analysis in the world, it's the market that decides in the end. If you like to criticize after the fact, it's because you don't know anything about technical analysis, so go ahead!
- Do not argue: Some people insult or disparage an analysis just because they do not agree on the analysis’ meaning. No one asks you to agree all the time and it is even good to be critical, but you have to argue your point of view.
Putting a negative vote on an analysis without explaining why, amounts to the same thing.