Are technical trading rules profitable? Evidence for head-and-shoulder rules

  title={Are technical trading rules profitable? Evidence for head-and-shoulder rules},
  author={Bernd Lucke},
  journal={Applied Economics},
  pages={33 - 40}
  • Bernd Lucke
  • Published 1 January 2003
  • Economics
  • Applied Economics
The profitability of chartist trading rules on foreign exchange markets is still under debate. Since simple technical trading rules may not adequately capture the complex phenomenon of chartist trading, this study focuses on the prominent head-and-shoulder pattern as a representative trading rule which incorporates various ‘technical’ ideas such as smoothed trends, trend reversal, resistance levels, and volatility clustering. For various combinations of the building blocks of head-and-shoulder… 
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