Quote from marketsurfer:
I am talking about objective, fixed rule based TA. That's the only kind that can be tested, and when tested it fails. Despite the claims. So maybe we do agree.
"When the red crosses the blue, the RSI and Stochastic are at x Go long"
The markets are a fluid on going development with a million if and buts yet just enough coherency to get by, I am going to be honest with you when I say I did not think you would be arguing against such systems. I have always assumed they were a crutch used until enough screen time has been invested to subconsiously react to what one is seeing in the market, used as a frame work to note how the market reacts around it, its indiscrepancies and so forth. A set of rules to focus on while you learn the market in relation to them and by doing so you learn the behaviour of the market.
I mentioned above that I can not articulate the way I trade 100%, I liken it to driving, the controls of a vehicle are standardized, there are fixed mechanical rules to follow concerning gas steering and braking etc. There is a code of conduct to follow while interacting with other traffic yet every situation is new. We may drive down the same roads every day with the same vehicles surrounding us and despite the code of conduct and fixed mechanical rules all drivers are operating under any trip has the potential to be anything from the mundane to life threatening.
How we are able to read and react to these situations is a product of our expereince, even when faced with a situation we have never come across, if we are expereinced enough we can react to it, yet we may not know why we reacted that way, why we sensed something was up.
Having fixed rules for every situation with trading is as bizzare as having fixed rules of response for every single situation one comes across when driving, there are vital rules needed with both but you can never legislate every response beyond those vital few, it would restrict your response in fatal ways, experience and the actions born out of that expereince are the only things we can rely on.
If people really do buy/create such inflexible systems, blow an account and simply go on to get another system, then another, looking for the "holy grail" of trading, without paying attention to the raw market unfolding infront of them, then our old boy EMG is out of a job isent he, as 100% of those who do a skydive without a parachute die to.
Point being I did not think you would be arguing about the obvious and Xpurts combination of TA/chart reading and producing a game plan for the current market hes seeing does not equate to this crap, although they do get complex. The above is not to say if you have a dam good method it cant be taught however, it depends on the individual.
I can only go by what I have witnessed in real markets with real professionals. Looking at charts is not how most real pros trade. The market is full of deception, what you are told isn't always the way reality is.
Buffet does not use a chart, surely its down to the indivdual?
http://dc589.2shared.com/download/KLk0WtT7/ABC.png?tsid=20130428-052429-91eb53dd
I would not have entered this in 2009 on the say so of two lines but I wouldt have entered it without taking the chart into consideration either, fundamentals etc are fantastic but you can still enter on the edge of a cliff, if its a long term play then for some it does not matter as much. Do long/short- emerging/aggressive growth - the majority of hedge and mutual funds not use charts at all?
I think a problem with todays crowd and TA/systems is how accessible it all is. Decide you want to be a trader join a forum and within minutes you can have a demo account up and running with a full system. There are thousands of systems and indicators on the forex forums, back in the day people had their charts printed out or drew them, with each update in time drawing in and caculating their indicators, at times having to redraw entire charts.
The understanding gained from this vs todays newbie who spends the majority of his time looking at indicators he doesent understand the maths behind instead of the market its self developing must be immense, I spent my first two weeks drawing what I was seeing unfold on screen, dear god it was boring but I knew it would serve me well.
There is so much on offer today that people are expected, or rather expect to run with these systems before they can walk.
Peace.
