My only edge is technical analysis
- Thread starter traider
- Start date
TA is the most important part, ultimately.
When you trade midterm especially.
News, and of course, scan the market for the right stocks, are other important things.
Then you can add volume as well.
I see having know-how when it comes to options trading as an important 'edge'.
Options can be great.
Weird OP.
Do your statements show positive expectancy over time without fail or evidence of degradation?
What does your equity curve's opinion on the subject?
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Why is it an edge? Do you have a strategy or method that isn't written in books? Do you have information that if you shared with others you would worry about your strategy being less effective? Do you have a way of looking at markets that few others do? If you read books or listened to others and took their ideas, that's not an edge imo. If you took something that people commonly know and tweaked it a bit, maybe that could be an edge, but if it's not pretty novel then I'm guessing it won't beat S&P on risk adjusted basis, let alone taking into account commissions, borrowing, bid/ask spread, etc.
Price and volume action, at least in futures markets, has changed dramatically over the last several years due to MM, HFT, ML, people finally realizing there were a lot of inefficiencies in these markets to exploit etc.. What may have worked 2, 3, 5 years ago, quite possibly is no longer valid. So it all depends on what your edge is imo.
Why are you in trouble if you are making money trading using TA?
TA is an edge? So you're saying you and millions of other traders who use TA have the 'EDGE'?
So who are the losers taking the other side of these TA trades?
FA losers
TA is based on the premise that all information about a security is priced in and can be used to predict the future or at least future direction. Books like The Encyclopedia of Technical Market Indicators have studied the various indicators and found no predictive value. All securities have a trend component that can be measured beyond random. If you want to do all trading based on this, just be prepared for large periods of nontrending markets and a lower than 50% win loss ratio.