Are all the Technicians Suckers?

This is a very interesting story (http://www.nanyang.com/index.php?ch=7&pg=12&ac=674340, retrieved at 3 December 2006). However, this story is only written for those technicians who are willing to read this with open-minded. This is important, as the arguments could challenge the deep core value of the technical analysts and evoke emotional instability or imbalance within themselves.

In 27 November 2006, a sudden spike with high volume leads INSBIO to the top 10 highest volume stock in the market. From the technical point of view, this is truly bullish, a high breakout with high volume, from a tight trading prices and successful breakout of prominent resistance line. At this moment, I am so confused, as the week before, I just scanned through the MESDAQ counters and found many correction or adjustment possible stock, but INSBIO is not in my list. How could I expect a stock with an inconsistent earning which most of the time, red in color, to adjust healthy? Well, it is ok; never mind, because I hold nothing in the stock. Subsequently, the stock follow with heavy volume, with correction-liked consolidation happen. Oh my god, now I suspect many day traders are noticing INSBIO and start to enter it, because, obviously, they saw a surpass of MA from their Metastock (perhaps Metastock version 20.0). With high confidence and clouded by emotions, with the spirit of brutal traders and ambitious to gain gigantic wealth which could be more than what both Bully Gates and Charity Buffett combined, these traders punch in INSBIO frantically! Oh, that is it, no mercy, INSBIO could be the next GPACKET and I am riding with it, is what they think. The volume continued, and after 5 days (1 week of trading activities), news come out in the paper. Those academicians who never touch stocks before read the news with jaws open widely, with their hand holding the Efficient Market Hypotheses (yeah, this is their bible in finance), and are found murmuring "Amen. Fama, dispel the spirit of evil from my heart, and bla, bla, bla..." (FYI, Fama is somehow equivalent to God in EMH, although recently he seems to turn his mind upside down and start venturing into behavioral finance, but that discussions are out of topic for this story).

Nevertheless, I am not trying to discourage these traders; mistakes happen, and occasionally they become the suckers for those people who wish to dump their stock intentionally (sad to say, 2 institutional dealers sitting side by side and shouting, "bid it up, I am catching it" is just too common), but their spirit is worth respecting. I myself don’t dare to do such things, and I personally think that they truly deserve the Medal of Honor. Without them, how the stock market can be so interesting?

Are technicians suckers (in this context, a bad-luck sucker)? I don’t really know, but I believe they are not always the suckers; they do make great profit too... It is just quite often, they become the volunteer suckers. Well, that is normal and expected, because they put everything into their mouth, be it banana or shit.


INS生物科技总执行长 叶绍全脱售9.66％股权 2006/12/03 12:36:37●南洋商报

（吉隆坡2日讯）INS生物科技（INSBio，0088，自动报价股）总执行长拿督叶绍全在上周通过公开市场脱售2千769万4千700股，或相等于该公司9.66％缴足资本的股权。
根据大马交易所的资料显示，他分别在11月27日脱售1千500万股、11月29日脱售300万股、11月30日脱售469万4千700股，以及在12月1日脱售500万股的股权。 他在完成上述脱售行动后，其持股权已被冲淡至1亿零850万3千400股或相等于37.85％的股权。 -->-->另一方面，奥斯克创投（OSKVI，0053，自动报价股）也在11月27日，通过公开市场脱售INS生物科技310万股的股权，以及通过同一家证券行场外易手2千万股的股权。 根据大马交易所的资料显示，叶绍全与奥斯克创投在11月27日当天共脱售了3千810万股INS生物科技股权，占该股项全日成交量的62.48％。 INS生物科技股项在11月27日价量齐升，全日总成交量达6千零98万2千500股，与前一个交易日的57万2千股成交量相比，取得显著增长，其股价也在当天上涨5.5仙至29.5仙的水平挂收。