Does market profile system have the potential for generating good retruns ?

[qlai]

"yo, u just gotta work hard and practise dis shit, dis tool is better tool...makes u dig faster and has nugget finder attached.

Lol, so true. I would just say that learning different tools/indicators is still useful in understanding how market particupants slice and dice information. Just don't spend too much time on it, it's all hypothetical and generalized, imho

 

[fube]

The benefit it has added to my trading is that it helped me determine exits. Before, I always struggled with exits. I would have to use my experience to determine how much my product would typically move if X happened. That was somewhat reliable, but I didn't like that it wasn't objective. Market profile/Volume profile provided me with what I needed: Objectivity. I had a more concrete way to understand why I was getting out. This helped me objectify my exits, which has helped the psychological game for me massively.

Edit: Also, just want to say one thing: I don't think it's a good idea to frame it as a system because it's not. I also don't think this idea of a "system" should even be apart of the trading lingo. Systems are unreliable. You need structure and a framework. I view my understandings/strategies of the market in the following way... My strategy is like water, and the market at any point in time can either be a cup, a balloon, a bottle, etc... and the water (my strategy/understanding of the markets) must be malleable and adapt according to what object in front of it that it must fill. Not trying to appear as if I am imparting some guru-esque wisdom, but it's just my view of things.

 

[golfdude]

I wasn't trying to be disrespectful or cocky. I really think you should not trade at this point and probably should not even think about starting.

Thing is: Profits in trading come from having an advantage over other people. You either are faster so you can grab the risk free profit before everyone else. Or you are smarter thus you understand interrelations and context better than everyone else so the chance of being on the right side of the market or dodging bullets is bigger.

That said, I'm using volume profile and bar charts...but in no single way are those two tools P/L drivers.

I don't make money because I use charts and profiles. I use charts because somehow I have to figure out which price I want to trade, how big my position is going to be and how many contracts I need to hedge. So I use those tools to organise myself.


To come back to your question: How is a graphic that is available to everyone who pays for it giving you an advantage over everyone else?

There are a lot of people who are way smarter than I am. I learned everything I know by falling on my face, getting up, learning a lesson, rinse, repeat. And I know that if something works so well that you can make millions with it, at least the smartest people will take advantage of it.
Yet nobody who is either making or managing millions (two different things, really), uses this stuff to generate alpha.


Again, to come back to your question but digging deeper now: When you ask "Does it have the potential to generate good returns when applied to different timeframes" you imply that markets have some intrinsic...lets call it riches...like a goldmine and the only thing you need is some tool that allows you to dig up the nuggets.

The course sellers/educators are abusing that thinking. They'll be like "yo, u just gotta work hard and practise dis shit, dis tool is better tool...makes u dig faster and has nugget finder attached. 3000$ for the tool and the course.

In reality, everybody just needs to dig. The big guys have excavators and dig everywhere, the money managers and hedgefunds have a couple of PhD students with shovels who do the digging for them in very special places they researched.

Problem with the retailers is they come up with kids plastic shovels from Walmart and try to compete with the big guys and the money managers and no education and no course and no nugget finder will ever help them. The big guys will outmuscle you and the money managers will outsmart you.

The only way to make a profit in the markets for the small fry is finding a niche neither the big guy nor the smart guy is interested in and nobody will help you with that.



So Profile charts can be a nice support because they are much more accurate than price charts, but at the same time they don't tell you the direction and when to pull the trigger.

Good points. In that case, how about trading option strategies with probabilities on your side ?? Here if you use statistics and probabilities wisely, you can over time aim to beat the market returns.

 

[murray t turtle]

Yes but as with all methodologies, it requires a disciplined trader who has put in the extensive work...and that's the rub.

%%
Exactly + takes more than a ''few months' to test anything. TRY 10 years.

 

[ironchef]

Good points. In that case, how about trading option strategies with probabilities on your side ?? Here if you use statistics and probabilities wisely, you can over time aim to beat the market returns.

Statistics and probabilities? They are picks and shovels, you still need to know where to dig.

And as MrMuppet said, the professionals have bulldozers and excavators against our picks and shovels. Been there done that, armed with BSM, binomial algorithms, excel spread sheets, VBA... I am no match for folks with room full of computers and army of PhD mathematicians, theoretical physicists, statisticians, financial analysts and economists.

So, I (we), mom and pop retail(s), have to find crumbs, leftovers from the big boys. Kind of reminded me of panning for gold in abandoned gold mines.

 

[ironchef]

Problem with the retailers is they come up with kids plastic shovels from Walmart and try to compete with the big guys and the money managers and no education and no course and no nugget finder will ever help them. The big guys will outmuscle you and the money managers will outsmart you.

The only way to make a profit in the markets for the small fry is finding a niche neither the big guy nor the smart guy is interested in and nobody will help you with that.

A perfect description of what one of them is trying to do.

There is no free lunch. In fact everyone is trying to eat our lunch.

 

[golfdude]

Statistics and probabilities? They are picks and shovels, you still need to know where to dig.

And as MrMuppet said, the professionals have bulldozers and excavators against our picks and shovels. Been there done that, armed with BSM, binomial algorithms, excel spread sheets, VBA... I am no match for folks with room full of computers and army of PhD mathematicians, theoretical physicists, statisticians, financial analysts and economists.

So, I (we), mom and pop retail(s), have to find crumbs, leftovers from the big boys. Kind of reminded me of panning for gold in abandoned gold mines.

So if we only have shovels why not dig in the same place as the excavator ? I mean why not follow the trend which the big boys are following.

This is also one of the main tenets of market profile. Market goes like this
Balance ---> Imbalance ----> Balance.

You need to identify it.

 

[They]

So if we only have shovels why not dig in the same place as the excavator ? I mean why not follow the trend which the big boys are following.

This is also one of the main tenets of market profile. Market goes like this
Balance ---> Imbalance ----> Balance.

You need to identify it.

As stated above, MP is away of viewing trade activity, some people swear by it, some people think it is a waste of time. We are all programmed differently. Use whatever helps you identify high probabilities of profit.

BTW, have you ever used a shovel on the edge of a hole where an excavator is digging?
Dangerous shit, just like trading.

 

[MrMuppet]

So if we only have shovels why not dig in the same place as the excavator ? I mean why not follow the trend which the big boys are following.

This is also one of the main tenets of market profile. Market goes like this
Balance ---> Imbalance ----> Balance.

You need to identify it.

There is no such thing as "trendfollowing". This is just an old expression from people who id not know better. When you follow the trend, you are betting on autocorrelation.

So when your market is autocorrelated, even moving averages make money.

Big boys do not follow the trend, this is long gone.

 

[qlai]

Big boys do not follow the trend, this is long gone.

Common, really ... after this long bull market!? So how exactly the big boys make money with billions under management? Scalping?