Currently, pure technical trading data shows that the more mature the market, the less it is used. Comparing the S&P 500's patterns and candlesticks before and after 2000 reveals that technical analysis is becoming weaker.
You grab 20 orders on Didi every day to earn some gas money, compared to being fully invested in crude oil futures when Saudi oil pipelines are bombed—are they the same thing? Real traders are doing asset staircases—every major black swan event is like a kick from fate, propelling you up a new step, followed by long periods of small platform oscillations, waiting for the next wave of heat. Don't talk to me about a mythical stable profit of 5% per month (if such a thing exists, please introduce me to the big guy). The truth of the current market is: 80% of profits come from 20% of significant event windows. Only if you can accurately leverage during scenarios like LME nickel shorting, Credit Suisse's collapse, and the Red Sea disruption, you are truly skilled; otherwise, you should play the role of a ninja turtle.
There are always people asking me which master to learn order flow naked K-line from. Today I’ll make a bold statement: the support and resistance lines you draw on TV will ultimately be crushed by the shockwaves of international games.
Note: Exogenous Shock refers to unforeseen systemic risk events
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The past glory of technical analysis
Once upon a time, we could thrive on Fibonacci retracement, but now? The moment the Nord Stream pipeline boomed, a decade's worth of natural gas weekly support levels evaporated. Do you think I am exaggerating? Just look at the scene when LME nickel was being shorted:
- Traditional technical analysts: "Hourly MACD divergence, short at the current price!"
- Real world: LME suddenly pulled the plug, exchange rules crushed all indicators
- Survival rule: Those holding short positions meet on the rooftop, while the rich holding spot commodities pop champagne.
What truth does this teach us? In the face of epic black swans, your Bollinger Bands are more fragile than a wafer cookie.
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The history of the extinction of technical indicators
The morning when the 10-year U.S. Treasury yield broke through a key psychological level witnessed the complete failure of technical analysis:
1. Classic theory: 3% is a strong resistance level for twenty years, the breakthrough probability is below 12%
2. Real world: The Bank of Japan suddenly abandons YCC control, technical levels shattered like glass windows hit by a truck.
3. The reality of life: CTA Strategy 1 triggered $200 billion in stop-loss orders within an hour
At this moment, it’s not about how much you understand harmonic patterns, but whether you were present in the market.
Fourfold cultivation present in the market
1. Physical anomaly: Still holding energy futures exposure when the guns of Ukraine sound
2. Information gleaning: Capturing early signs of the Red Sea crisis from shipping company scheduling data.
3. Volatility feast: Completed Swiss franc position building before the Swiss National Bank abandoned the exchange rate floor.
4. Anti-fragile structure: When Blackstone's BREIT faced a wave of redemptions, preemptively ambushing longs in REITs derivatives
Remember: You don’t need to predict when a volcano will erupt, but you must hold a heat-resistant container when the magma flows.
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When the line-drawing crowd becomes cannon fodder on the western front.
1. Waterloo moment: The instant AMD's earnings report collapsed, all option strategies based on historical volatility collectively died.
2. Death zone: 9:30-10:00 AM ET during U.S. stock market open, quantitative programs sweep away all traditional technical signals.
3. Residual value: Used to capture the approximate range for trades
A brother's complaint captures the essence: "When my trend line was broken for the third time by the WTO ruling, I finally understood that technical analysis is just a child’s game in peaceful times."
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Three soul-searching questions
1. When a geopolitical missile flies over the Red Sea, are you focused on the order flow book or checking the tanker schedule?
2. When a trillion disappears from the central bank's balance sheet, how much value does your Fibonacci toolkit still have?
3. When the market enters quantum collapse mode (dropping 20% instantly and then rebounding), can your account withstand three seconds of a punch?
Evolution roadmap
Bronze rank: Counting K-lines / Drawing channels / Measuring Fibonacci.
Silver rank: Monitoring ETF fund flows
Gold rank: Deciphering the subtext of FOMC meeting minutes / Analyzing background noise in earnings call.
King's rank: Anticipating the trajectory of currency wars in SWIFT messages / Predicting supply chain disasters from cargo ship AIS signals
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Written at the end
Pouring cold water on friends who still want to get rich quickly through technical analysis: the techniques you are diligently practicing now are essentially training to shoot arrows from horseback against intercontinental missiles. It’s not that they are completely useless, but don’t let survivor bias blind your eyes.
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