All indicators useless?

"Yes my trading improved when I begin to understand probabilities of the strategy along with better risk management (I do this via position size management). "

NihabaAshi,
I have tried position sizing, but always seem to make the wrong call as to what kind of size I should play on which trade. Have found for me personally that trading one size (500 shares) has been optimal...plan on increasing to 1000 shares as my account grows. So far my avg winning day is $200 and avg losing day is $70 (both net). With 55% winning days.
Maybe you could give me some ideas on how you decide your size for a particular trade?
Thank you.
C.
 
Quote from indahook:

...Maybe you could give me some ideas on how you decide your size for a particular trade?
Thank you.
C.
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Hi indahook,

Later this evening...I'll send you a private message...so make sure your ET box isn't full :cool:

NihabaAshi
 
Quote from NihabaAshi:



I disagree.

I'm a discretionary trader in the Eminis and all my trade setups have specific rule-based criterias.

No feelings...no hunches...no opinions.

No sujectvitiy about the rule-based criterias.

Here's where the subjectivity (discretionary aspect) comes into play...

For example...lets say I get a trade signal 2mins prior to the release of a key economic report or a few minutes before an interest rate announcement...

I most likely will ignore the trade.

Simply...I won't take the trade eventhough its a trade signal.

Here's another example...lets say I get a high probability trade signal that I usually go normal to heavy on the contracts...

however...the current market internals starts acting weird because President Bush is live on TV and being covered by all the major financial networks...

I may take the trade...but light on the contracts to manage my risk or no trade at all.

To me...that's discretionary trading and one of the reasons why backtesting or looking for statistical meaning via computer methods...

just doesn't work because of the subjectivity involved in whether or not to take a trade.

The more I think about this...in some ways you may be right if you were talking about another type of trader...

one that trades WITHOUT a trading plan (entry signal, exit signal, stop/loss placement, profit-targets, ect)...

nor a trading methodology (the business aspect of trading...overhead costs management...size management...risk management and so on).

P.S. Maybe the trading plan and trading methodology described above is interchangable.

NihabaAshi
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Well said!
 
There is one foolproof indicator.
If you have to hit the head.....the market will definitely move quickly in your absence......It is listed in the Peter Principle somewhere:D :D
 
indahook - I totally agree in what you say, that indicators are useless and just cause confussion and (noise). I have been studying the markets for about 10 years and studied (MAC D, RSI, BOLLINGER BANDS, VOLUME OSCILLATORS, ROC, POSITIVE VOLUME INDEX AND NEGATIVE VOLUME INDEX, STOCHASTICS AND THE LIST GOES ON.) I have now been doing an indepentant trading system for a private investors for two years now and stocks for the past 10 years, so pulling the trigger does not come into it. But I am glad that someone else on this forum has come to the same conclusion as me, with a little help from the past and not forgotten wild, who pointed me in the direction of e-mini (liquid and volume.) I have also discovered after studying 13 hours a day for two years, candlesticks, support and resistant levels, is all that really counts, if you want a good profit to loss ratio. By working using this method I have a ratio of 17 out 20 winners. The experts and senior members of most chat rooms say "keep it simple" and when you discover this skill, you can unclutter you mind and concentrate on what the markets are actually doing instead of spending an hour checking all the signals first.
 
Quote from spreadem:


Don't you mean a mechanical trader?
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To be honest, i think theres a bit of semantics going on here. What one trader calls something might mean something completely different to another. I'm not sure what mechanical is. Can you define for me.

Also, for clarification of my previous posts in this thread, I do look at moving avgs and std deviations but I do not consider those indicators. To some other traders they might. So you can see how we all can confuse each other. I was just trying to give somebody my perspective.
 
There are no absolutes. A discretionary trader can have rules but have the experience to know when to improvise. One of a trader's greatest assets is to remain flexible and open-minded.

What one trader calls something might mean something completely different to another.
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I agree.

Many discretionary traders are mechanical and many mechanical traders are discretionary in their approaches when it comes to executing trading signals. :)

Indicators themselves (which is what this thread is about) are considered discretionary tools to some traders, but to others they are considered mechanical tools.
 
Quote from spreadem:

I agree.

Many discretionary traders are mechanical and many mechanical traders are discretionary in their approaches when it comes to executing trading signals. :)

Indicators themselves (which is what this thread is about) are considered discretionary tools to some traders, but to others they are considered mechanical tools.
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Thats the great thing about the markets in general...we all see something different. Very cool.
 
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