Do professional traders trade using TA?

This is a question that's been lingering in my head a long time but I've never found an answer to it. Any video you see on Youtube that teaches trading is either just telling you about supply and demand zones, peddling weird indicators/courses the Youtuber is selling, or drawing a bunch of lines and calling it a day. I know there is no way professional trading is like this and yet it is so mystified outside the industry. Can any trader here enlighten me on this? I'm talking equities specifically FWIW. 

Comments (5)

Jul 28, 2022 - 8:21pm
WSO Monkey Bot, what's your opinion? Comment below:

Hi Prospect in IB-M&A, whoops, looks like nobody chimed in here.... maybe one of these discussions below is relevant:

More suggestions...

Fingers crossed that one of those helps you.

Jul 31, 2022 - 10:42am
rhall1, what's your opinion? Comment below:

I know you said equities specifically, but since nobody else is coming in...

In FI it's something that we can look at, but its not really just looking at a chart and saying 'oh we broke resistance' or something. if something is trending strongly/is optically mispriced it's a signal that something is usually happening there. Maybe there is a certain buyer that is quietly pumping a price up, or bank funding is dictating a change in behavior for non-market reasons that is having market impact. I view it generally as technical signal -> research underlying reason -> determine value of signal and act.

  • Prospect in S&T - Equities
Aug 1, 2022 - 2:25am

I am only an intern but on our trader floor yes. Sales Trading Desk does use some technical analysis because they need to forecast the intraday price movements. Not sure whether that's accurate tho. I was told by a senior to read more about technical analysis and send him my opinion everyday regarding the index. But I think this is only his preference cuz he used to be a great retail investor before joining our bank.

Most Helpful
  • Works at Bank of America Merrill Lynch
Aug 1, 2022 - 10:28am

Short answer is yes but it's more sophisticated than the typical talking points on CNBC. Another thing is it's not something that it is widely talked about outwardly to the general public about because there is a ton of skepticism about TA especially in academia. I had professor who was an ex-trader at a BB who taught finance and was explicitly told by his department head that he can't lecture about TA. He did it anyway because he said that even if it doesn't reflect academia or there isn't any verifiable price action driven by TA, it's still important because market participants use technical analysis so it's real and should be considered. He taught us some things he used but caveated that if we were to become professional traders that most of what he taught could be outdated/un-useable. 

Aug 1, 2022 - 1:08pm
superbushero, what's your opinion? Comment below:

Blanditiis qui illo laudantium voluptatem aut et repellendus omnis. Aut accusantium pariatur eum consectetur omnis. Temporibus dolor autem modi beatae hic ab. Aliquid earum quis ullam veniam facilis. Laboriosam ut fugit cupiditate possimus beatae praesentium.

Ut incidunt maxime ipsa reprehenderit aperiam aut. Reiciendis eius dolorem ut vero atque aut sed. Occaecati architecto porro aliquam eaque officiis nihil.

Start Discussion

Career Advancement Opportunities

September 2022 Investment Banking

  • Jefferies & Company (▲05) 99.6%
  • Lincoln International (= =) 99.2%
  • Bank of America Merrill Lynch (▲04) 98.8%
  • Financial Technology Partners (+ +) 98.5%
  • Evercore (▽02) 98.1%

Overall Employee Satisfaction

September 2022 Investment Banking

  • Jefferies & Company (▲12) 99.6%
  • Greenhill (▲07) 99.2%
  • Evercore (▲01) 98.8%
  • PJT Partners (▽02) 98.4%
  • Macquarie Group Limited ABN (▲21) 98.1%

Professional Growth Opportunities

September 2022 Investment Banking

  • Jefferies & Company (▲05) 99.6%
  • Lincoln International (▲03) 99.2%
  • PwC Corporate Finance (▲12) 98.8%
  • Bank of America Merrill Lynch (▲05) 98.5%
  • Houlihan Lokey (▲05) 98.1%

Total Avg Compensation

September 2022 Investment Banking

  • Director/MD (10) $613
  • Intern/Summer Analyst (318) $407
  • Vice President (38) $392
  • Associates (209) $257
  • 2nd Year Analyst (130) $163
  • 3rd+ Year Analyst (19) $160
  • 1st Year Analyst (438) $151
  • Intern/Summer Associate (83) $150