WEBVTT - Katie Stockton Started with Technicals in College 0:00:02.240 --> 0:00:06.800 This is Masters in Business with very Ridholts on Bloomberg Radio. 0:00:09.560 --> 0:00:12.680 This week on the podcast, my special guest is Katie Stockton. 0:00:12.920 --> 0:00:15.880 She is the chief technical strategist at bat I G, 0:00:16.440 --> 0:00:20.439 a New York based brokerage firm, the institutional brokerage firm. 0:00:20.480 --> 0:00:24.120 If you are at all interested in really some of 0:00:24.160 --> 0:00:28.560 the details of a practitioner in the field of technicals 0:00:28.680 --> 0:00:31.880 who are using it as part of their process to 0:00:32.000 --> 0:00:37.960 advise UH substantial hedge funds, pension funds, mutual funds, really 0:00:38.280 --> 0:00:42.519 large pools of institutional money, UH, then this is the 0:00:42.560 --> 0:00:46.320 sort of conversation that you're gonna enjoy. We very much 0:00:46.360 --> 0:00:48.479 go into the weeds and we talked a lot about 0:00:49.200 --> 0:00:54.640 very very specific technicals and processes and how she approaches 0:00:55.560 --> 0:00:59.720 the market. She she's an award winning UH technician who 0:00:59.800 --> 0:01:04.039 is highly respected on the street. And really it's it's 0:01:04.080 --> 0:01:08.840 a um, quite a change in the world to look 0:01:08.880 --> 0:01:13.720 at technicals today as is accepted and part of the 0:01:14.640 --> 0:01:18.480 firmament of finance, compared to ten or twenty years ago 0:01:18.520 --> 0:01:21.840 when they were kind of looked looked at askance. And 0:01:21.920 --> 0:01:26.880 I think the between the rise of quantitative analysis and 0:01:27.080 --> 0:01:31.640 the computing power that really lets us see, Hey, are 0:01:31.680 --> 0:01:35.600 these technicals genuinely providing value or not that that's helped 0:01:36.120 --> 0:01:40.440 them gain broad acceptance. So if you're at all interested 0:01:40.600 --> 0:01:44.880 in trading, charting, anything technical, you're gonna really enjoy this 0:01:44.959 --> 0:01:49.360 conversation with no further ado, my interview with Katie Stockton. 0:01:53.720 --> 0:01:57.200 My guest today is Katie Stockton. She is the chief 0:01:57.400 --> 0:02:02.600 Technical Strategist for bt I G in New York City. Previously, 0:02:02.720 --> 0:02:05.560 she was chief market technician at m CAM Partners. She 0:02:05.640 --> 0:02:09.680 has also been a trader for Ulysses Management fairly substantial 0:02:09.680 --> 0:02:13.280 New York hedge fund. She also was a publishing analyst 0:02:13.320 --> 0:02:17.720 for the Technical Strategy Group at Morgan Stanley. She is 0:02:17.760 --> 0:02:21.520 a CMT and she received her designation in two thousand one. 0:02:21.840 --> 0:02:27.520 This year, she was named Best Institutional Brokerage for Equity 0:02:27.560 --> 0:02:32.919 Research at the Technical Analysts Award for the technical research 0:02:33.120 --> 0:02:37.000 she provides. Katie Stockton, Welcome to Bloomberg. Thank you Berry. 0:02:37.080 --> 0:02:39.040 It's good to be here. It's good to have you. 0:02:39.120 --> 0:02:41.640 Let's let's start with a little bit about your background. 0:02:42.120 --> 0:02:44.519 How did you find your way to Wall Street? What 0:02:44.680 --> 0:02:48.160 attracted you to stocks, bonds and charts. Well, I think 0:02:48.200 --> 0:02:50.520 it was really meant to be early on, I had 0:02:50.560 --> 0:02:54.000 an interest in mathematics and and that took me into 0:02:54.000 --> 0:02:58.400 a finance major in college. And fortunately, you know, that 0:02:58.440 --> 0:03:01.839 finance major obviously bosed me to you know, all things 0:03:01.919 --> 0:03:06.440 Wall Street, of course, but also exposed me to technical analysis, 0:03:06.480 --> 0:03:08.840 which is of course what I do today in college. 0:03:08.919 --> 0:03:11.680 In college, believe it or not, really so, so, what 0:03:11.840 --> 0:03:14.320 sort of classes were you taking where they talked about 0:03:14.400 --> 0:03:18.880 charge Because it seems that at the academic level, other 0:03:18.960 --> 0:03:21.280 than people like Professor Andrew lo O and m. I. 0:03:21.360 --> 0:03:25.200 T who writes about technicals and the heretics of finance, 0:03:26.000 --> 0:03:29.760 academics look askance at technicals. Well, you know, I think 0:03:29.760 --> 0:03:35.240 there's a good trend there quite frankly, but still early stages, 0:03:35.400 --> 0:03:38.240 right right, I'm broken out yet. Um. But when I 0:03:38.920 --> 0:03:42.000 went to University of Richmond in Virginia, a smaller school, 0:03:42.480 --> 0:03:45.800 and it just happened to have coursework in technical analysis. 0:03:45.800 --> 0:03:47.720 Believe it or not, it was one of at the time, 0:03:47.760 --> 0:03:49.960 it was one of twelve universities that offered this, and 0:03:50.000 --> 0:03:52.720 now there's far more. But even still, I just got 0:03:52.800 --> 0:03:55.040 lucky in a way that they offered that coursework. At 0:03:55.040 --> 0:03:56.800 the I believe it was a four hundred level of 0:03:56.840 --> 0:03:59.440 Finance class and at the time it was offered to 0:03:59.480 --> 0:04:02.320 graduate students, so I audited it and that gave me 0:04:02.360 --> 0:04:04.480 the exposure to some of the tools that I now use. 0:04:05.080 --> 0:04:07.880 So you had the bug pretty early in your career, 0:04:07.920 --> 0:04:09.920 did Yeah? And I had an internship while I was 0:04:09.960 --> 0:04:13.160 at college for a firm called Dorsey right An Associates. 0:04:13.320 --> 0:04:15.920 If you've heard of them, Not only have I heard 0:04:15.960 --> 0:04:18.760 of them, but Tom Dorsey was a previous guest on 0:04:18.800 --> 0:04:20.680 the show Is That Right? And Tom is great? And 0:04:21.680 --> 0:04:24.280 I'm guessing you'll eventually ask me who my mentors are, 0:04:24.400 --> 0:04:28.520 and Tom Dorrissey will come up again in our conversation. 0:04:28.640 --> 0:04:31.760 He's obviously a great person and a great technician and 0:04:31.839 --> 0:04:34.080 really helped inspire me to do it for a living 0:04:34.200 --> 0:04:36.720 point and so we'll get into point and figure on 0:04:38.000 --> 0:04:43.000 versus other types of charting later. Um. So, I've spoken 0:04:43.040 --> 0:04:47.360 to various technicians who began their career either as fundamental 0:04:47.360 --> 0:04:50.480 analysts or strategists and said, you know, I'm really more 0:04:50.520 --> 0:04:53.800 interested in the supply and demands of stock transactions than 0:04:54.560 --> 0:04:57.719 the broad I don't want to call it guesswork, but 0:04:57.880 --> 0:05:02.479 the broader, less tech the cool things you apparently never 0:05:02.520 --> 0:05:05.200 had that sort of bug. You went straight into the 0:05:05.960 --> 0:05:08.559 straight into it, and like I said, it just seemed 0:05:08.560 --> 0:05:10.960 like it his fate for me to to do what 0:05:11.000 --> 0:05:14.240 I do now because it's it's such a great mesh 0:05:14.600 --> 0:05:18.760 of the mathematical side of things, and it really resonates 0:05:18.800 --> 0:05:22.440 with me in terms of analyzing a stock as a stock, 0:05:22.640 --> 0:05:25.560 not just as representative of a company, because as we 0:05:25.600 --> 0:05:28.920 all know, you'll see a market move effect various stocks 0:05:28.920 --> 0:05:31.760 in a way that makes no sense from a fundamental perspective. 0:05:31.839 --> 0:05:35.240 So to be able to understand how that's happening, why 0:05:35.279 --> 0:05:38.360 it's happening, and really what's happening, and I think that's 0:05:38.440 --> 0:05:41.839 very valuable. So when I took the course, the Technical 0:05:41.880 --> 0:05:46.080 Analysis course with Ralph Alkimpora, one of the things that 0:05:46.120 --> 0:05:49.920 have stayed with me was a quote of his and 0:05:50.120 --> 0:05:54.800 Ralph said, fundamentals tell you what to buy, Technicals tell 0:05:54.880 --> 0:05:58.479 you when what do you think? Well, there's undeniably a 0:05:58.560 --> 0:06:01.599 great market timing element that you can derive from the charts. 0:06:01.680 --> 0:06:04.080 And I would also argue though, that you can use 0:06:04.120 --> 0:06:07.719 them for idea generation and it becomes a matter of preference. 0:06:07.720 --> 0:06:12.120 So I think of technical analysis as really a complementary discipline, 0:06:12.160 --> 0:06:13.920 So it's not a stand alone in the same way 0:06:13.920 --> 0:06:16.960 that I don't think macro you know, economics or fundamentals 0:06:16.960 --> 0:06:20.359 should also be a stand alone. I think together you 0:06:20.400 --> 0:06:23.080 can get a great sort of rounded view of a 0:06:23.160 --> 0:06:26.120 market or a security. And you know, if the fundamentals 0:06:26.160 --> 0:06:27.800 help you decide what to buy, and then you use 0:06:27.839 --> 0:06:31.279 technicals or charts to understand your best entries and exits, 0:06:31.320 --> 0:06:33.760 that's definitely one use. So there's a lot of risk 0:06:33.800 --> 0:06:36.800 management involved in using completely. Yeah, that they can be 0:06:36.880 --> 0:06:39.360 very valuable, especially for a cell discipline, which I think 0:06:39.360 --> 0:06:41.680 a lot of people are lacking for sure. So so 0:06:41.760 --> 0:06:45.840 what is technical analysis actually measure? When you're looking at 0:06:45.839 --> 0:06:48.360 a chart of a stock, what are you really looking at? 0:06:48.880 --> 0:06:52.000 You know, it's it's prices, right, So the market really 0:06:52.080 --> 0:06:55.440 lends us one data point and it's price, and I 0:06:55.440 --> 0:06:59.279 would argue that volume is another one. But yet has 0:06:59.360 --> 0:07:01.679 really lost some of its value in terms of having 0:07:01.680 --> 0:07:05.440 in any predictive information. Why is that? Why is volume that? 0:07:06.880 --> 0:07:09.840 As a trader and it was always volume proceeds price, 0:07:10.000 --> 0:07:13.120 you heard that constantly. Is that no longer it used 0:07:13.120 --> 0:07:15.760 to be? Yeah, you need to see volume expanding into 0:07:15.760 --> 0:07:18.480 sustainable up trends, and that that was the stuff of 0:07:18.520 --> 0:07:21.440 the textbooks way back when. Now, of course we've seen 0:07:21.560 --> 0:07:24.680 volume on on the decline since about two thousand and seven, 0:07:24.720 --> 0:07:27.920 so about ten years now. Is that of the financial 0:07:27.960 --> 0:07:30.880 crisis or the rise of indexing or I think many 0:07:30.880 --> 0:07:33.360 different A little it's many different things. I mean, there's 0:07:33.360 --> 0:07:37.800 obviously derivatives. We have so many different influences on volume 0:07:38.040 --> 0:07:40.280 these days, and I would argue some of them are 0:07:40.320 --> 0:07:43.960 not um real volume. I mean, there's always a buyer 0:07:43.960 --> 0:07:46.840 and seller, right, but are these committed buyers? Are they 0:07:47.000 --> 0:07:50.840 you know, real sellers so or are they passive you 0:07:50.880 --> 0:07:53.880 know indexers, or or are they high frequency traders? So 0:07:53.920 --> 0:07:57.040 you just you can't really understand if the volume is 0:07:57.080 --> 0:07:59.720 real these days. And then it's also been on the decline, 0:07:59.800 --> 0:08:02.920 so you have these influences that make it just that 0:08:03.080 --> 0:08:05.680 much less helpful in my opinion. So to me, I'm 0:08:05.720 --> 0:08:09.000 I'm very much just looking at prices, and prices can 0:08:09.040 --> 0:08:12.120 be incredibly informational and and of course those prices are 0:08:12.160 --> 0:08:14.920 measuring supply and demand, and it's just that simple. Let's 0:08:14.960 --> 0:08:18.960 talk a little bit about what the chief technical strategist does. 0:08:19.320 --> 0:08:22.840 What does your process look like, where do you begin. Well, 0:08:22.880 --> 0:08:24.920 I am a cell side research analyst, so I work 0:08:24.960 --> 0:08:27.760 for a broker dealer b T i G here in Manhattan. 0:08:28.000 --> 0:08:32.480 Your clients are mostly large institutions, all institutional clients, and 0:08:32.600 --> 0:08:35.439 it runs a gamut in terms of hedge funds, mutual funds, 0:08:35.960 --> 0:08:39.239 really anyone who can benefit from this kind of analysis, 0:08:39.280 --> 0:08:42.760 which I would describe as top down in nature. But 0:08:42.840 --> 0:08:44.560 I also do a lot of bottom up work to 0:08:44.640 --> 0:08:47.679 support that, or my version of bottom up work is 0:08:47.679 --> 0:08:49.719 probably quite different than what we all know. So that's 0:08:49.720 --> 0:08:51.440 what I was gonna ask. When you say top down, 0:08:51.440 --> 0:08:55.760 you're really looking at markets, different types of asset classes, 0:08:55.800 --> 0:08:59.560 different sectors, and bottoms up our specific companies. Is that's 0:08:59.600 --> 0:09:02.679 exact right? I do tend to be equity centric, and 0:09:03.240 --> 0:09:06.360 at BT I G we are global financial services firms, 0:09:06.360 --> 0:09:08.760 so I've branched out and looked at more than just 0:09:08.960 --> 0:09:11.840 US and to really global equity markets. And I do 0:09:11.920 --> 0:09:15.360 start with the major indussease, the equity indsease. I look 0:09:15.400 --> 0:09:18.040 at sector benchmarks, things like that, and then of course 0:09:18.080 --> 0:09:21.719 anything that really influences equities, whether it's commodities, f X, 0:09:21.920 --> 0:09:24.480 things like that. So that's where I start and I 0:09:24.520 --> 0:09:27.080 think it's an important place to start in a UM 0:09:27.160 --> 0:09:29.360 an environment that is so sort of top down driven, 0:09:29.440 --> 0:09:32.280 right where where the macro influences are so important and 0:09:32.320 --> 0:09:35.080 really are the drivers of some of the trends. And 0:09:35.520 --> 0:09:38.199 to understand that's very important. I mean, if you're if 0:09:38.200 --> 0:09:41.280 you're you know, right on the market, generally, you're probably 0:09:41.280 --> 0:09:43.160 going to have a much better you know time at 0:09:43.400 --> 0:09:46.480 being right on any individual company. And then I do 0:09:46.840 --> 0:09:49.640 also look at the market, um, you know, just based 0:09:49.640 --> 0:09:52.680 on the stocks that comprise the major indicry. So every week, 0:09:52.720 --> 0:09:55.640 every other week, in fact, I'll do either international or 0:09:55.760 --> 0:09:58.559 US and and take a list of five hundred stocks 0:09:58.559 --> 0:10:00.880 and look at those one by one. And it's a 0:10:00.920 --> 0:10:04.480 bit tedious, but that process to me helps me in 0:10:04.600 --> 0:10:07.840 my my market views, but also can help us understand 0:10:07.840 --> 0:10:11.920 where there is opportunity UM whether it's breakouts or breakdowns 0:10:12.000 --> 0:10:14.560 or a theme based opportunity. So we're just looking for 0:10:14.679 --> 0:10:17.800 developments on the charts and themes. So when you're looking 0:10:17.800 --> 0:10:22.480 at charts, are you looking specifically for either extensions of 0:10:22.520 --> 0:10:26.199 trends or breaks of trends? Are you looking at specific patterns? 0:10:26.400 --> 0:10:29.040 What is it that catches your main focus? Well, I 0:10:29.360 --> 0:10:32.240 really do believe as you could imagine in trend following, 0:10:32.480 --> 0:10:35.240 and I think that you generally want to have your 0:10:35.280 --> 0:10:38.800 core long exposure in you know, securities that are in 0:10:38.880 --> 0:10:40.680 long term up trend set. And there's a lot of 0:10:40.720 --> 0:10:44.160 academic support for for that. Certainly. Yeah, you know, a 0:10:44.240 --> 0:10:47.480 trend in motion tends to stay in motion. And yet 0:10:47.520 --> 0:10:49.480 where I can also add value to our clients as 0:10:49.480 --> 0:10:52.839 an understanding where there might be an inflection point or 0:10:53.160 --> 0:10:55.800 you know, deteriorating momentum that type of things. So we 0:10:55.840 --> 0:10:59.000 do spend a lot of time looking for signs of 0:10:59.000 --> 0:11:02.720 trend exhaustion it how would you how would you look 0:11:02.760 --> 0:11:06.040 for trend exhaustion and how would you define that? There? 0:11:06.160 --> 0:11:09.160 There's I'd say there's three classes of indicators that I use. 0:11:09.280 --> 0:11:12.400 The first would be momentum or trend following, the second 0:11:12.400 --> 0:11:15.520 would be overbought oversold, and the third would be relative strength. 0:11:16.040 --> 0:11:19.400 So to arrive at that trend exhaustion signal, I'm typically 0:11:19.440 --> 0:11:22.640 looking at the overbought oversold measures. So for me, that 0:11:22.640 --> 0:11:26.160 would be a stochastic oscillator or Tom Demark's suite of 0:11:26.200 --> 0:11:30.280 indicators tend to help with that as well. And what 0:11:30.280 --> 0:11:32.000 what don't you look at what are the sort of 0:11:32.040 --> 0:11:34.600 things that you just don't find of a lot of 0:11:34.679 --> 0:11:37.520 value at least to your process, right, and it's very 0:11:37.520 --> 0:11:40.360 specific to the individual. Of course, what you have success 0:11:40.400 --> 0:11:42.959 with and what I always recommend to people is to 0:11:42.960 --> 0:11:46.680 to have a process and whatever that process, maybe to 0:11:46.760 --> 0:11:50.000 be consistent and somewhat systematic in the way you approach it, 0:11:50.440 --> 0:11:53.800 because what you learn is that these indicators, while they 0:11:53.840 --> 0:11:57.439 fail you, often you learn where they tend to fail you. 0:11:57.720 --> 0:12:00.000 And it's all in really how you combine the indicat 0:12:00.040 --> 0:12:03.880 heaters that you arrive at a market view, and so 0:12:03.920 --> 0:12:08.439 it's fairly probabilistic. You're no one indicator is a sure thing, 0:12:08.960 --> 0:12:11.280 but a collection of indicators give you a better chance. 0:12:11.320 --> 0:12:13.560 That's exactly right, And it helps to take out some 0:12:13.640 --> 0:12:15.720 of the gray area of the market. So I really 0:12:15.760 --> 0:12:17.880 welcome those kinds of tools that are a bit more 0:12:17.920 --> 0:12:22.520 mathematically derived and less visual, but to really just enhance 0:12:22.559 --> 0:12:24.880 what you're seeing more visually, because you can't take that 0:12:24.960 --> 0:12:27.840 element away, of course. But what I don't use would 0:12:27.840 --> 0:12:32.520 be UM. I don't use many UM you know, wave analysis, 0:12:32.520 --> 0:12:36.160 no wave for me, I don't use anyone. Still a 0:12:36.200 --> 0:12:40.080 lot of people do in fact, and my experiences is 0:12:40.120 --> 0:12:42.760 that they tend to be more bearish than not. Has 0:12:42.800 --> 0:12:46.120 that worked out the well, and so I think, you know, 0:12:46.160 --> 0:12:48.760 maybe that could be more successful when overlaid with some 0:12:48.800 --> 0:12:51.679 of the momentum tools and what else don't you use. 0:12:51.920 --> 0:12:55.760 What do you think of fibinaci as a trading tool, Well, 0:12:55.800 --> 0:12:58.320 it's not really a trading tool, but it's a way 0:12:58.360 --> 0:13:01.760 to identify support and resist stance, right, so that can 0:13:01.800 --> 0:13:04.000 be very valuable. In fact, I think, if if any 0:13:04.040 --> 0:13:06.600 takeaway that you have from the charts, support and resistance 0:13:06.640 --> 0:13:08.560 should be where you start, because that's your gauge of 0:13:08.760 --> 0:13:12.800 risk and reward. So fibonacis can be very very helpful 0:13:12.800 --> 0:13:15.840 in that regard. They're a little difficult to explain to clients, 0:13:15.840 --> 0:13:19.400 as you could imagine, because why do they work? Yeah? Why? Yeah? 0:13:19.440 --> 0:13:22.640 Why do they work? It's a ratio throughout nature. I 0:13:22.679 --> 0:13:25.400 don't want to man explain fibonaci because you're the I 0:13:25.480 --> 0:13:28.560 wish I wish you would. In fact, it is the 0:13:28.600 --> 0:13:31.920 golden ratio, which is found in all sorts of um 0:13:32.080 --> 0:13:37.320 in and in um, the nautilus shells, and in all 0:13:37.360 --> 0:13:41.040 sorts of other things like that. And as you said, 0:13:41.360 --> 0:13:44.760 we're not really sure why it works or it works, 0:13:45.200 --> 0:13:48.280 but it certainly seems to be there. It does matter, 0:13:48.440 --> 0:13:50.400 and it can be really helpful when you don't have 0:13:50.480 --> 0:13:53.719 more traditional means of deriving support and resistance. And by 0:13:53.720 --> 0:13:56.400 that I would mean something like a movie average, a 0:13:57.160 --> 0:14:00.000 movie average, or a peak or a trough on the chart. 0:14:00.480 --> 0:14:03.200 So my friend Todd Harrison, who used to be a 0:14:03.320 --> 0:14:06.440 chief trader at a hedge fund, used to say, is 0:14:06.960 --> 0:14:10.520 with things like Fibonacci when we would be debating how 0:14:10.559 --> 0:14:14.839 well they work or didn't work, is the support there 0:14:15.040 --> 0:14:18.320 because of the fibonacci or is the fibonacci there because 0:14:18.320 --> 0:14:22.120 of the support? Or? In other words, if everybody believes 0:14:22.160 --> 0:14:25.200 something is the case, does it just become a self 0:14:25.240 --> 0:14:28.240 fulfilling prophecy or something else going on? You know? I mean, 0:14:28.280 --> 0:14:30.320 we we could talk about that. I don't think there's 0:14:30.360 --> 0:14:33.440 any real answer to that question, unfortunately, except to say 0:14:33.480 --> 0:14:38.120 that where things are self fulfilling, great because we we 0:14:38.200 --> 0:14:41.480 welcome that. And uh, you know, I'd say the fibonacis 0:14:41.520 --> 0:14:43.440 would be less obvious as something that would be self 0:14:43.440 --> 0:14:47.480 fulfilling in that it's a subjective approach to draw in 0:14:47.480 --> 0:14:50.560 those ratios on the charts, whereas something like the two 0:14:50.960 --> 0:14:53.480 day movie average would be more likely to have that 0:14:53.520 --> 0:14:56.400 self fulfilling nature. I support resistance because there's so many 0:14:56.400 --> 0:14:58.880 eyes on it. Let's talk a little bit about technical 0:14:58.960 --> 0:15:03.040 analysis for the late person. Explain to us what technical 0:15:03.080 --> 0:15:07.760 analysis actually is. Well, you know people know it as charting, right, 0:15:07.840 --> 0:15:10.800 So you take a price. Any security has a price, 0:15:11.400 --> 0:15:14.160 and what we're using is that price as a gauge 0:15:14.200 --> 0:15:17.040 was supply and demand for that security, and trying to 0:15:17.120 --> 0:15:20.360 understand the trends behind that, and not only the trends 0:15:20.400 --> 0:15:24.240 but also when they might end. So that that's the 0:15:24.280 --> 0:15:27.080 design of technical analysis. We're trying to understand where there 0:15:27.160 --> 0:15:30.160 might be a shift in that supplied demand relationship just 0:15:30.400 --> 0:15:34.800 using price based analysis. So early in your career you 0:15:34.960 --> 0:15:38.160 worked for Tom Dorsey at Dorsey Right, and they are 0:15:38.320 --> 0:15:42.440 famous for point and figure charting. How does that chart 0:15:42.640 --> 0:15:48.080 differ from just a regular price chart. Um, it's incredibly different. Yeah, 0:15:48.120 --> 0:15:49.880 you know, when you look at it, it it looks almost 0:15:49.880 --> 0:15:52.920 like a tic tac toe sheet with x's nose And 0:15:53.600 --> 0:15:57.280 the most important distinction is that it doesn't really reflect 0:15:57.400 --> 0:15:59.600 time on the X axis in the same way that 0:15:59.800 --> 0:16:02.520 a typical bar chart which would have open high low 0:16:02.560 --> 0:16:05.760 closed data would UM. I tend to use the bar 0:16:05.880 --> 0:16:09.200 charts more now, in part because it was difficult on 0:16:09.280 --> 0:16:12.920 a in a cell side position to explain exactly why 0:16:12.960 --> 0:16:15.600 we should care about these xs and os. But they're 0:16:15.600 --> 0:16:18.640 really such such a useful a way of looking at 0:16:18.680 --> 0:16:21.040 the market is to understand this supply demand that goes 0:16:21.080 --> 0:16:23.160 into the xs and os that you're plotting on these 0:16:23.240 --> 0:16:26.880 these grids UM great for trend following, great for understanding 0:16:26.960 --> 0:16:30.520 breakouts and breakdowns. Um, but you know they omit a 0:16:30.600 --> 0:16:36.200 volume component and no volume, no time, just buying and selling. Yeah, 0:16:36.240 --> 0:16:38.480 just buying and selling, Like you know, has price moved 0:16:38.600 --> 0:16:42.640 enough to designate another plot? Basically, what are what are 0:16:42.680 --> 0:16:46.120 some of the big misconceptions about technical analysis? We've heard 0:16:46.160 --> 0:16:49.520 people say over the years that stuff is just voodoo. 0:16:49.960 --> 0:16:52.840 Oh and they're still saying it, some of them. But well, 0:16:53.240 --> 0:16:55.200 I've been doing this for about twenty years, and I'd 0:16:55.200 --> 0:16:58.280 say it's come a long way, a really long way, 0:16:58.320 --> 0:17:01.160 so in terms of the level of professionalism that you 0:17:01.200 --> 0:17:04.919 see in our our small industry, and for good reason, 0:17:05.000 --> 0:17:09.000 because people are realizing that that it's helpful, and I 0:17:09.040 --> 0:17:12.920 think the push towards using it more systematically has really 0:17:13.359 --> 0:17:17.000 taken it to that next level. So the misconceptions would 0:17:17.040 --> 0:17:20.200 be that we're trying to you know, take historical prices 0:17:20.240 --> 0:17:24.280 and always you know, predict something that it's overly predictive, 0:17:24.320 --> 0:17:28.080 and then you assign these silly names to various price patterns, 0:17:28.119 --> 0:17:30.639 and I think that adds to some aura of it 0:17:30.720 --> 0:17:33.760 being not as serious in terms of the analysis, But 0:17:33.880 --> 0:17:36.520 in reality it's it's more surface level because it really 0:17:36.560 --> 0:17:39.119 is only price based. And I see that as a 0:17:39.160 --> 0:17:41.480 positive because it allows you to look at anything and 0:17:41.560 --> 0:17:44.000 have an opinion on it in less than a minute, 0:17:44.040 --> 0:17:47.159 for for example, and it's objective. You're not you know, 0:17:47.240 --> 0:17:50.720 you're looking at the actual data, not someone's opinion about 0:17:51.119 --> 0:17:54.800 management or new product or new that's right, And I 0:17:54.840 --> 0:17:57.280 think in a way that's a good thing because you 0:17:57.280 --> 0:18:00.600 you become less committed to a position. And if you 0:18:00.840 --> 0:18:04.240 identify a stock that you're interested in because it has 0:18:04.280 --> 0:18:07.520 a great uptrend or some renewed momentum behind it, or 0:18:07.520 --> 0:18:10.919 it's exhibiting relative strength, um, but you've only put in, 0:18:11.080 --> 0:18:13.800 you know, twenty minutes of research on it, um, I 0:18:13.840 --> 0:18:17.480 think you're less likely to get married to that position. Um, 0:18:17.520 --> 0:18:20.320 But you know the best types of positions, in my opinion, 0:18:20.440 --> 0:18:23.439 would have that you know, that trend falling, you know, 0:18:23.680 --> 0:18:27.679 those gauges lined up positively, but also have the fundamental backdrop, 0:18:28.200 --> 0:18:30.000 So that to me would be an ideal setup. And 0:18:30.000 --> 0:18:32.840 I think more and more people are recognizing the value 0:18:32.960 --> 0:18:36.560 and using it as that complementary discipline as opposed to 0:18:36.600 --> 0:18:39.280 something that's designed to say, okay, well, whereas you know 0:18:39.359 --> 0:18:43.200 this SMP five going to be in five years, because 0:18:43.240 --> 0:18:45.560 that's not really to me where the value is. I 0:18:45.600 --> 0:18:49.720 love the idea that it allows a degree of objectivity 0:18:50.040 --> 0:18:54.919 so that you don't marry a position. A phrase I 0:18:54.960 --> 0:18:59.159 heard many years ago was strong opinions weekly held and 0:18:59.200 --> 0:19:01.360 I've always really enjoyed that. We love this and then 0:19:01.359 --> 0:19:03.680 it breaks the trend and that's it. We're done, right. 0:19:03.840 --> 0:19:07.080 So to be somewhat noncommittal, Um, it does tend to 0:19:07.080 --> 0:19:09.879 help you manage risk. It does. So let's talk a 0:19:09.920 --> 0:19:14.359 little bit about technology. How has the ubiquity of of 0:19:14.400 --> 0:19:20.680 not just computers, but really high powered software on everybody's desktop. 0:19:21.040 --> 0:19:23.800 How has that changed the work you do as a 0:19:23.800 --> 0:19:27.760 as a technician in a very favorable way? Um, you know, 0:19:27.840 --> 0:19:30.680 with my first job out of college was actually hand 0:19:30.720 --> 0:19:34.200 charting these point figure charts that you describe. So, um, 0:19:34.240 --> 0:19:37.120 you know now that we have all these resources to use, 0:19:37.280 --> 0:19:41.280 the upside is it's really unlimited. It's it's exciting, um, 0:19:41.320 --> 0:19:43.200 in that we can do so much more in terms 0:19:43.240 --> 0:19:46.199 of our capacity to not only draw the charts and 0:19:46.280 --> 0:19:49.560 access the charts, but also to filter for different setups 0:19:49.560 --> 0:19:53.360 and look for different price patterns using some advanced software 0:19:53.400 --> 0:19:56.680 that can identify these patterns almost for you. It's really 0:19:56.680 --> 0:19:59.399 amazing what you know people have come up with in 0:19:59.440 --> 0:20:02.560 that regard, and it can be very helpful in terms 0:20:02.600 --> 0:20:05.600 of idea generation. But also you know that the push 0:20:05.640 --> 0:20:09.919 towards AI and more quantitative approaches to the market, they 0:20:10.080 --> 0:20:13.280 tend to have a technical element to them because a 0:20:13.359 --> 0:20:16.240 lot of them are price based. You have that that input, 0:20:16.480 --> 0:20:18.840 and so I think there's a lot of upside there. 0:20:18.840 --> 0:20:22.080 I think it's still somewhat early stages in terms of 0:20:22.160 --> 0:20:24.520 what can be done with it, but certainly, you know, 0:20:24.600 --> 0:20:27.280 anything that you can program, of which a lot of 0:20:27.280 --> 0:20:29.960 indicators are very programmable, I think there's a lot of 0:20:30.000 --> 0:20:34.080 upside there. In the introduction, I mentioned the award you won, 0:20:34.600 --> 0:20:39.600 which is quite an honorific to receive the essentially the 0:20:39.640 --> 0:20:42.920 Technologomist of the Year award. For lack of a better phrase, 0:20:43.119 --> 0:20:45.720 tell us a little about the award and how have 0:20:46.359 --> 0:20:50.280 your institutional clients responded to that. So they the Technical 0:20:50.280 --> 0:20:53.080 Analyst which is a UK based organization. They do an 0:20:53.080 --> 0:20:58.520 annual awards event and ceremony and with more than one category, 0:20:58.640 --> 0:21:01.240 so by no means that my Technical Analysts of the Year. 0:21:01.280 --> 0:21:03.920 But but we do, you know, appreciate the honor of 0:21:04.320 --> 0:21:09.119 being labeled best institutional brokerage for equity research, which of 0:21:09.560 --> 0:21:13.879 course is technical nature. So we um you know, have 0:21:14.000 --> 0:21:17.080 publicized that in different ways, you know, a press release, 0:21:17.160 --> 0:21:20.920 and it's been well received by clients of course, and 0:21:20.920 --> 0:21:23.600 and what their their vote of confidence is in the 0:21:23.640 --> 0:21:27.720 written product that we produce. It's funny that I gave 0:21:27.760 --> 0:21:30.359 your award of promotion. I'm trying to do appreciate it. 0:21:30.440 --> 0:21:33.040 I was I was interviewing somebody and I could not 0:21:33.800 --> 0:21:36.879 keep their title straight in my head. It was one 0:21:36.920 --> 0:21:40.760 of these typically long sort of Wall Street and by 0:21:40.800 --> 0:21:43.240 the time the interview was done, I just had given 0:21:43.320 --> 0:21:45.560 up trying to get their title right. And it was 0:21:45.600 --> 0:21:48.320 just And today we have the CEO of JP Morgan 0:21:48.400 --> 0:21:51.840 and you know, they could see the compliance person in 0:21:52.000 --> 0:21:54.359 booths pulling their hair out of their head. It was 0:21:54.440 --> 0:21:57.080 it was pretty hilarious, but it was a big deal. 0:21:57.240 --> 0:22:00.800 Was the big award that I'm not exaggerating one shorthanded. 0:22:00.960 --> 0:22:04.920 Do you believe we we beat out fifteen other firms 0:22:05.280 --> 0:22:07.879 and UM that's exciting to me. It really is a 0:22:07.920 --> 0:22:11.520 vote of confidence in what we're producing. And they were 0:22:11.560 --> 0:22:15.919 complementary of the research as being you know, timely and actionable. 0:22:16.600 --> 0:22:18.359 Do you got to like that? Right? So so let's 0:22:18.400 --> 0:22:23.639 talk about UM clients today. I tease the segment as 0:22:23.840 --> 0:22:28.200 what modern institutional clients want? What is it that clients 0:22:28.720 --> 0:22:34.120 are looking for from a technical UM research analysts like yourself. 0:22:34.240 --> 0:22:37.160 There's no one answer to that. In fact, every meeting 0:22:37.200 --> 0:22:40.040