25809 Technical Analysis

Faculty of Business: Finance and Economics
Credit points: 3 cp

Subject level: Postgraduate

Result Type: Grade and marks

Requisite(s): 25721 Investment Management
These requisites may not apply to students in certain courses.
There are also course requisites for this subject. See access conditions.

Handbook description

This subject familiarises students with all aspects of technical analysis – a major force in financial markets. Topics include types of charts, reversal and continuation patterns, congestion/consolidation, Elliot and Krondratieff wave theory, and cross confirmation.

Subject objectives/outcomes

On successful completion of this subject, students should be able to:

Understand the theory and profitable applications of technical analysis to financial and commodity markets.
Analyse the actual market data using various technical analysis methods.
Understand technical analysis techniques and concepts used in evaluation.

Contribution to graduate profile

This course provides students with knowledge of the central tenants and methodology of technical analysis, which along with fund analysis is one of the two major paradigms of prediction of future asset prices. As such the course plays an important part in the education of students interested in funds management.

Teaching and learning strategies

The subject will be presented using a combination of lectures and workshops. These classes will be supplemented with both printed and electronic learning materials and resources.

Content

History of Technical Analysis
Type of analysis
Types of charts - line charts, bar charts, point and figure charts; how to construct them, select data and optimal sensitivity
Jargon and Derived Jargon -support, resistance, trend line, fan line, filter rule, moving averages, RSI, Coppock indicator etc.
Reversal Patterns and Continuation Patterns
Congestion/Consolidation
Elliott wave theory and Krondratieff Wave Theory
Cross Confirmation
Applying TA to Spot and Options Trading.

Assessment

Assignment (Individual)	50%
Tests the analysis of actual market data using the techniques developed in the course. This assignment will allow students to demonstrate that they have met the objectives 1-3.
Final Exam (Individual)	50%
Tests the understanding of the techniques and concepts developed in the course. It will enable students to demonstrate that they have met the objectives 1-3.

Recommended text(s)

Murphy, J J, (1999), Technical Analysis of the financial markets, Prentice-Hall, New York.

Indicative references

Edwards, R. O. and Magee, J., (1987), Technical Analysis of Stock Trends, 5th ed., John Magee Inc., Boston

Murphy, J J,. (1999), Study Guide for Technical Analysis of the Futures Market, Institute of Finance, New York.