Richard Kapsch of
Chicago was an eminent trader right
from his early days as a trader on the Chicago Mercantile Exchange’s (CME)
trading floor. He is a self-made man who went on to take up the mantle as CME’s
governor. After his stint as the governor of CME he continued his carrier as
the President of Pride Group LLC in Chicago, Illinois. He has been the pillar
of support and guidance for the Pride Group’s financial endeavors all over the
globe.
Among many of Richard Kapsch’s lectures on trading principles
let me share his words of wisdom on technical analysis. According to Mr. Richard Kapsch, Technical Analysis is widely perceived by many as a tool
that can tell you about the price of securities, assets or commodities at any
point in the future.
Contrary to the popular belief Mr. Richard Kapsch says, this is the basic misunderstanding among many investors, as Technical analysis is no crystal ball that can pin point the price in future. Investors who approach Technical Analysis with this belief sadly will and do burn their fingers and develop bitterness towards it as the adage goes ‘once bitten twice shy’. But, let me tell you this Technical Analysis if used prudently will hugely improve your investment success.
In Mr. Kapsch’s inimitable way, Technical Analysis simply put is nothing but the analysis of the patterns in price movements using charts and statistics as a major tool in the process. The fundamental belief in Technical Analysis is that: history repeats itself; the historic price patterns are indicative of future movements. Contrary to fundamental analysts who decide on buy and sell moves based on the intrinsic value of the asset, Technical analysts primarily use changes in price and trade volume of an asset as the pointer for its future price movements.