Does Technical Trading Really Work?

[marketsurfer]

"4th Quarter earnings will be $120 million" is a company forecast based on their internal analysis of their data.

Traders take this info and hold it up against past sales data to determine if it is meaningful. If sales 4th quarter last year were $300 million, that makes the current forecast meaningful than if you looked at it in a vaccuum. $120 million is sales is meaningless unless put in context to past data for that company.

Makes sense. But that's not price data

 

[Q3D]

This might be a decent recipe for longer term trading/investing. Day traders tend to trade inside the gyrations of the market, and intraday trading allows for greater leverage to take advantage of these smaller swings.

In this scenario, prudent risk management requires a stop loss at a level where the signal that price is more likely to move one direction becomes invalidated by a new signal that price is now more likely to move the opposite direction. Why stand and defend a position in the face of a signal that the odds have shifted in favor of a position opposite your current position?

Risk management depends on how manipulated a market is. CL is a market I recommend avoiding placing a stop within 20 points of entry price unless stop is below or above a previous low or high of day.

Readers are waiting for you to share those statistics on your trading setup heuristics / algorithm exploits.

 

[NoDoji]

CL is a market I recommend avoiding placing a stop within 20 points of entry price unless stop is below or above a previous low or high of day.

I haven't used a 20-point stop in CL for years. My stops are between 2 and 15 ticks depending on the setup.

Having a stop below/above a previous low/high of the day implies a counter-trend trade, which isn't my style of trading.

 

[learner2007]

I planted some flower seeds in a sandbox last December. The next day there were no flowers.
So that proves it. 'Gardening does not work’.

 

[schizo]

Nothing works in the market. No technical analysis. No indicators. No oscillators. No support or resistance. No trendlines. Not even pure price actions like 3-bar reversal. Fine, don't trade!

 

[Q3D]

I haven't used a 20-point stop in CL for years. My stops are between 2 and 15 ticks depending on the setup.

Having a stop below/above a previous low/high of the day implies a counter-trend trade, which isn't my style of trading.

This sounds like marketing to entice new traders. Any stop less than 10 ticks on CL is idiotic with 1 contract, let alone Al Brooks size 10-100 contracts.

 

[onemoreshot]

This sounds like marketing to entice new traders. Any stop less than 10 ticks on CL is idiotic with 1 contract, let alone Al Brooks size 10-100 contracts.

There are always exceptions and very few certainties in the markets. nodoji is far from idiotic.

 

[schizo]

Stoploss is too far away because it's always hit when nearby. Stopping out at irrational levels messes people up. Sometimes it ruins them forever.

Is it better to get stopped out two or three times with very minimal losses or once with very large loss? I personally prefer the former than latter. BTW placing stops at irrational level is what moves the market. Otherwise, the market would in fact be too damn irrational.

 

[dartmus]

Is it better to get stopped out two or three times with very minimal losses or once with very large loss?

Ask me again after marketsurfer and Q3D are banned. If debitspread is also banned it's possible I will still be here and notice your question.

 

[debitspread]

Since you're so eager to ban others, why don't you ask Baron to make you a mod?