Be well all -- gotta go to work!! Back after close.
Does TA work better or worse on lower or higher time frames?
- Thread starter iamnewuser911
- Start date
I think you need to apply Technical understanding to more than one timeframe as the momentum of the higher time frame will impact the lower time frame. The longer time frame players that move the market will step in once the lower time frame provides a good buying or selling opprotunity.
I was trading blind before only looking at 5 minute charts. You need to see how the market is positioned, ie the big picture.
I was trading blind before only looking at 5 minute charts. You need to see how the market is positioned, ie the big picture.
Everyone on ET claims a 3- 6 Sharpe trading TA -- but only if you do it his special secret way!
I'll play devil's advocate here! I do see certain things that don't duplicate from one time frame to another. The obvious one is gaps from one day to the other. But there's plenty I see on certain time frames that I don't on others. So, yes, certain patterns do duplicate from one time frame to the next, but not uniformly so, and not necessarily with the same impact. That leads me into:
TA is meant to inform, not impede. If you get too lost in the numbers, you'll lose the forest through the trees. If you're constrained by TA alone, you're leaving other information on the table...if you're relying on stale information, it's clouding your view of current information. Figure out what you can see from TA, and make sure it *adds* to your knowledge rather than restricting it. This is something that's taken me some time to learn, and I still fall victim to it regularly. I believe the natural tendency is to elevate certain information in importance to the exclusion of other info. Always look for what you don't see, not for what you do (you already see that).Okay (he said, picking up the gauntlet......), TA itself IS nothing more than moving averages (or 0.0↔1.0 normalizations). "That's a fact." I mean, it's algebra, fergawdsakes. And I'm sure you'd agree with that. (With a pint and a moment to ruminate.)
But if you're speaking of the messages it provides -- MACD histograms, ADX crossovers, or, very much so, Japanese Candlesticks -- these visual cues *do* (for me, at least) carry great (if intuitive) import. Especially candlesticks which, in a single slash-of-an-image, carry not 1 price point, but 4. (I mean, that *rocks*.)
The ole precision vs. accuracy debate. I'm a big proponent of accuracy over precision. I actively avoid getting too precise in my view of the market. Whenever i have numbers, I always append with "-ish" in my mind. This isn't science, this isn't precise. This is people behaving like people and trying to model it statistically. Remember that the numbers inform you of the behavior of other people, not the behavior of numbers.But this 'visual cuing' is learned, too, and not something programmable. If you wish to *try* to program it, you're going to be doing nothing but MAs.
Third quote of this post! And while I mostly agree with the post, I wholeheartedly disagree with this. Statistics are not math. They are fluid things that don't replicate consistently and masquerade under the guise of mathematical certainty. But statistics will not always come out the same in the way a math problem (properly solved) would. My point here is, doubt statistics and look at the motive behind their presentation. This is as true of political polling as of trading. The relevance to trading is to make sure you're not looking for confirmation of what you want to see--because there are numbers out there that will show you what you want to see even if it's not the story they tell.
Works on all time frames.
Most posters here replied based from the point of view of their trading strategy.
A poster will say yes, the market is fractal and it works on all timeframes because his strategy probably revolves around the overall price action, eg. elliot wave.
Another poster would say no, different timeframes have different reactions and smaller timeframes have more noise. And of course they are also correct from their trading system perspective. Because the lower timeframe they go, the more choppy it gets, eg. candle-by-candle analysis strategy.
So, it all depends on your system. What kind of system you have. A noise for a trader could be a signal to another.
A poster will say yes, the market is fractal and it works on all timeframes because his strategy probably revolves around the overall price action, eg. elliot wave.
Another poster would say no, different timeframes have different reactions and smaller timeframes have more noise. And of course they are also correct from their trading system perspective. Because the lower timeframe they go, the more choppy it gets, eg. candle-by-candle analysis strategy.
So, it all depends on your system. What kind of system you have. A noise for a trader could be a signal to another.
Nope.
You are "injecting your subjective view".
Proper TA trading in the markets is "objective"... not subject to personal understanding/whim. More like a physics problem.
No. It works on all time frames for any system.
Atta boy. Keep the confusion flowing.