first its there and then it ain't
- Thread starter hoodooman
- Start date
Quote from hoodooman:
I use technical indicators to trade very poorly, by the way. I use the Medved Quote tracker and right now my favorite setup is using 2 minute charts, candle sticks, trix and the parabolic sar. I also use the 50 ema and two 2ema's that track the high and low average of each candle. At the end of the day, my charts look absolute great. But in reality this is just a fantasy. In real time the trix crosses and then uncrosses before it decides what its going to do and the sar will give a buy signal and then change its mind and print out a sell on the same candle.
I would like to know if other people are having the same problem. Do their systems change signals or is this just a problem with QT. I would also like to know if there is a solution to the problem.
regards
peter daniels
First, it has nothing to do with the software. If you have the indicators update on every tick, they will change until the bar is complete.
You say the charts look great at the end of the day. Does that mean you could wait until the bar closed, then put on a trade successfully? That is simple enough. More likely, the successful trades look great and you skip over the ones that got chopped up or whipsawed. That is why backtesting s/w is useful. It takes every trade and displays the results.
Personally, I think you are making this too complicated. Three fourths of the battle is understanding what the trend is on the daily and 60 minute, then having the discipline to trade only in that direction.
i agree. THE DEFINITIVE ANSWER to this question is: NO, THEY ARE NOT TOTALLY RANDOM. END OF DISCUSSION, NO DEBATING IT, NO QUESTIONING IT. PERIOD.
Indicators are great for setting alarms, which is helpful on a day like today in that they free you to do other things. Otherwise, I've never found indicators other than the ADX/DMI to be of much help (though if I were in front of the computer all day, I could just draw trendlines).
You've discovered the pitfalls of trading any system or strategy that involves crossovers of some sort. For that reason, I side with the posts on support and resistance. As to where to find the support and the resistance, just ask yourself which are the levels at which the greatest number of traders are most likely to enter or exit a trade. Where are they going to be most afraid of missing out on a move? Where are they going to be most afraid of giving up their profits?
You've discovered the pitfalls of trading any system or strategy that involves crossovers of some sort. For that reason, I side with the posts on support and resistance. As to where to find the support and the resistance, just ask yourself which are the levels at which the greatest number of traders are most likely to enter or exit a trade. Where are they going to be most afraid of missing out on a move? Where are they going to be most afraid of giving up their profits?
It's not so much random as unknowable. It's assumed that in your testing of your system, there was a greater probability of winning trades over time. Therefore, the outcome of any particular trade will be unknowable, but, over time, the probability of success will be greater than that of failure, therefore not random.
I don't totally agree with that. For example, Trader Vic did a
study of the Dow from 1926 to 1985.
He calls it the "4-day rule"...He discovered that whenever the Dow had 4 consecutive up days or down days from an intermediate high or low within a 6 day period, there was a 75% chance the trend had changed.
If you want to read more about it, check out his book...Trader Vic II-- Principles of Professional Speculation.