I'm here with John Roach, a famed technical analyst who used to work for Soros Fund,

consistently top-ranked in the Institutional Investor Technical Group.

John, welcome to the compound.

Thanks for having me here, Barry.

So let's talk a little bit about the sort of technical analysis you do.

I've described it as one part, part, technicals.

Tell us a little bit about your form of technical analysis.

So I hope I'm not an apostate by saying this,

but what I figured out over time is that most technical indicators don't have the gravitas that they had in prior cycles.

And the reason I believe that is because in prior cycles, it was mostly a retail business and most of the trading was done on the floor.

So all the indicators that were developed were developed in prior cycles when all that occurred and that no longer occurs.

So we've tried to eliminate our reliance on indicators and concentrate more on price.

And that's the reason we have this four input item that just is based on price alone.

What sort of indicators do you think have lost their resonance with the trading crowd?

Well, for example, very often you will get deterioration in momentum indicators and long-term

momentum indicators which historically would have said wait a second the

environment is changing but with 15% of the volume coming from active managers and

85% of the volume coming from active managers and 85% of the volume coming from

what's called them passive or not active managers is it that much that's a

giant I've heard the numbers I don't keep those numbers but numbers I've heard are of that magnitude. We figure

that the indicators have less importance because there's less people creating what's

occurring in the indicator. For example it used to be fairly easier to divine market

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