hmm.no edges in the markets
- Thread starter chimera
- Start date
I've only played early entry on this setup a few times, BUT it's a very low risk trade because your stop loss is a few ticks.
I see two reasons for the trade based on James' chart:
1) A potential support zone (a Fib level?)
2) On the 1-min chart, price appeared to have printed a failed final flag around that support zone.
You only know it's a failed final flag if the LOD holds at that point, but again, with such a small stop and with the expectancy of a very strong reversal if in fact it holds, the R:R is excellent for these setups following a strong directional move, so it overcomes even a mediocre win rate.
I think most of those who trade by price alone would say it is just a bit more complicated than that (though not by much). You do not simply buy support or sell resistance. You observe what price does at those levels, which is to say you observe the behavior of traders when price reaches a level where traders had exhibited a certain behavior before to see if they behave the same or differently. Any action on your part should derive from your observations of other traders' s actions as evidenced on the tape, time & sales window, chart, or whatever device you choose to use as a "recording device" for price action.
Money flows determine price, not traders behavior overall. 1000 angry bearish retail traders all shorting at the same time, can't change the direction of an instrument if one bullish hedge fund manager decides to go all into a stock ( generic) with $100's of million. He who has the cash makes the price, not the behvior of the masses--- remember, this is just an example showing how its capital not sentiment of the masses that drives price. this is myth #2 of technical analysis.
The chart and the book are very different. The book shows transactions before they happen, the chart only shows completed transactions. Learning the book is effective because you can anticipate where price is going, chart reading only shows the past and you all know deep inside how difficult and futile charts really are. book reading makes sense because its using data that makes price, chart reading makes no sense because price has already formed prior to being printed . TA myth #3 destroyed.
Anyone truly serious about this business, trade at a prop firm that teaches real edges to learn-- pay no mind to those who claim consistent profits from looking at the transitions of price charts-- although, they may be able to "do it" via some mystical intuitive ability-- I have never seen it-- whereas a prop firm the only profits when you profit teaches real working edges that you can employ immediately-- good luck!
thank you,
surf
There's nothing futile about looking at charts.
The trader that doesn't look at charts before he trades is an idiot.
Another comment along these lines doesn't show much for whatever credibility you think you have, since your discussions do not place mathematical definitions like statistics as to why when you make your arguments that traders learning to trade from those indicators shouldn't even try then the purpose for being here is just for you to annoy the people who do utilize the techniques you claim nobody uses.
No, we should all wait to be entertained by another call from you with no math explanation and weeks of talk shows on ET about the terrible trades you've been recommending.
Yes, I should have stated the book. thanks for the typo correction!
surf