Intuition in trading.
- Thread starter Laissez Faire
- Start date
This is knowledge, not intuition.Bruce Lee obviously knew what intuition was: "You want intuition? This is how you get it."
On top of that, are there really 10,000 differents kicks?
Maybe, idk.
Often the notion of intuition is a disguise for guessing and then confirmation bias. If you want to believe in intuition, then you need to measure. Measuring outcomes for starts, but also the process of developing the "intuition" and then meeting the threshold for acting upon it. Not a simple task.
N.B. when you look at discretionary (day)trading decisions in real time, LATER when you have infinite time, you will often see a lot of variables-values-facts, that you simply do not have time to register, evaluate, cross check, and then act upon.* People think they can, in some twisted macho, determinism, but in fact it is a fools errand.
Why bother with "intuition" when you can automate all the variables-facts-values and have a script either summarize them into actionable information, or have it do those actions.
*Of course most people are still trying to figure out what those variables-values-facts are, let alone how they work in combination, in permutation and how to apply them to ENTER, MANAGE, EXIT a trade. They are stuck with the stupid idea that a single things is all then need for just an entry, aka the Grail. Talk about not even in the ball park, not even in the parking lot of the ball park.
If you want a good discussion of these types of studies, check out the book Choke. It is about how and why people mess up under pressure. Almost ALL the newbie posts about messing up, would be answered by understanding this topic.
N.B. when you look at discretionary (day)trading decisions in real time, LATER when you have infinite time, you will often see a lot of variables-values-facts, that you simply do not have time to register, evaluate, cross check, and then act upon.* People think they can, in some twisted macho, determinism, but in fact it is a fools errand.
Why bother with "intuition" when you can automate all the variables-facts-values and have a script either summarize them into actionable information, or have it do those actions.
*Of course most people are still trying to figure out what those variables-values-facts are, let alone how they work in combination, in permutation and how to apply them to ENTER, MANAGE, EXIT a trade. They are stuck with the stupid idea that a single things is all then need for just an entry, aka the Grail. Talk about not even in the ball park, not even in the parking lot of the ball park.
If you want a good discussion of these types of studies, check out the book Choke. It is about how and why people mess up under pressure. Almost ALL the newbie posts about messing up, would be answered by understanding this topic.
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Cold and rational. You only take trades you have seen before that work. These are are called high probability trades. There is no gut feeling to reading a chart. You can only trade what it is showing you it might do.
Can I borrow some of your intuition? I don't have any and cannot simply trade the market. I need rules.
Hello ironchef,
Click the buy and sell button +XXX per day. ALL your problems in life solved.
Trading is EASY, very EASY.
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i often use both.
i know that sometimes the market is obvious and i used to be suspicious of such clarity and stay out of it. and most of the time it would be trap but the market has to spring the trap and that means a move in the obvious direction which triggers the trend following signal but quickly reverses.
now i realise that if the market direction is obvious it means that the probability is high and if probability is high, then it means reward is small.
so i scalp or fade the break out.... the latter is dangerous because there is no place for a stop so you need to wait for a good reversal set up.
i know all this intuitively but no one can trade intuitively alone, you have to wait for a set up, so that stop placement can be done and you can control the risk.
most novices trade intuitively because they do not want to take the time to learn about the market and if you do not know something well, then it seems complicated and they mistakenly believe that you can deal with complicated things, intuitively.
dealing with simple market conditions intuitively is ok and that is why novices make money
but it can go really wrong when conditions get complex and novices do not stay out but do the thing, that made them money earlier and then wonder what hit them.
what makes complicated, simple, is the expertise: anything is complicated until you learn and practice it.
so trading intuitively -gut feeling- when you have no knowledge is foolish lazy and can be downright dangerous.
experienced traders can use intuition to filter trades and no doubt they do
i know that sometimes the market is obvious and i used to be suspicious of such clarity and stay out of it. and most of the time it would be trap but the market has to spring the trap and that means a move in the obvious direction which triggers the trend following signal but quickly reverses.
now i realise that if the market direction is obvious it means that the probability is high and if probability is high, then it means reward is small.
so i scalp or fade the break out.... the latter is dangerous because there is no place for a stop so you need to wait for a good reversal set up.
i know all this intuitively but no one can trade intuitively alone, you have to wait for a set up, so that stop placement can be done and you can control the risk.
most novices trade intuitively because they do not want to take the time to learn about the market and if you do not know something well, then it seems complicated and they mistakenly believe that you can deal with complicated things, intuitively.
dealing with simple market conditions intuitively is ok and that is why novices make money
but it can go really wrong when conditions get complex and novices do not stay out but do the thing, that made them money earlier and then wonder what hit them.
what makes complicated, simple, is the expertise: anything is complicated until you learn and practice it.
so trading intuitively -gut feeling- when you have no knowledge is foolish lazy and can be downright dangerous.
experienced traders can use intuition to filter trades and no doubt they do
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it is simple not easy.
the problem is the intuition that comes from inexperience, ignorance,..