Evidence-Based Technical Analysis by David R. Aronson

Description

Evidence-Based Technical Analysis: Applying the Scientific Method and Statistical Inference to Trading Signals by David R. Aronson challenges traditional technical analysis by advocating a scientific, data-driven approach to evaluating trading strategies. Aronson argues that most technical indicators and chart patterns lack empirical validation and often rely on subjective interpretation. Instead, he introduces statistical inference, machine learning, and rigorous testing methods to separate genuinely effective trading signals from randomness or bias. The book emphasizes the importance of hypothesis testing, data mining, and avoiding cognitive biases that lead traders to believe in unreliable patterns. By applying the scientific method to market analysis, Aronson provides traders with a framework to develop objective, evidence-based strategies rather than relying on intuition or conventional wisdom. This book is ideal for traders, quantitative analysts, and anyone seeking a systematic, research-backed approach to trading.