neither TA not FA?

Herd behavior.


Herd behavior describes how individuals in a group can act together without planned direction. The term pertains to the behavior of animals in herds, flocks and schools, and to human conduct during activities such as stock market bubbles and crashes, street demonstrations, sporting events, religious gatherings, episodes of mob violence and even everyday decision making, judgment and opinion forming.
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Some followers of the technical analysis school of investing see the herding behavior of investors as an example of extreme market sentiment.[5] The academic study of behavioral finance has identified herding in the collective irrationality of investors, particularly the work of Robert Shiller,[6] and Nobel laureates Vernon Smith, Amos Tversky, and Daniel Kahneman.

Hey and Morone (2004) analysed a model of herd behavior in a market context.
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http://en.wikipedia.org/wiki/Herd_behavior
 
Quote from the1:

Successful trading is based largely on intuition and the ability to adapt to changing market conditions. If you lack either you will not be successful.
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This is not correct.
 
BSAM, would you care to elaborate? It has been my experience that the study of price action leads to intuition and a state of "just knowing." Naturally, that doesn't mean "all knowing." I'm a strong supporter of Douglas' book "Trading in the Zone" and I couldn't agree more when he says you eventually get to the point where you "just know." I use technical analysis in my trading and find it a very useful tool but frequently I will abandon my signals and either pass on a trade or trade counter to the signal. Just the other day I got a nice trigger from a small pennant on the 1 min chart of the ES and I just had that feeling, based on how the market was behaving, that the breakout would fail. It did and I took a few points off it on the short side. It was a trade "in the moment" and I "just knew" the move up would fail. I'm curious on your thoughts.

Quote from BSAM:

This is not correct.
More...
 
Quote from the1:

BSAM, would you care to elaborate? It has been my experience that the study of price action leads to intuition and a state of "just knowing." Naturally, that doesn't mean "all knowing." I'm a strong supporter of Douglas' book "Trading in the Zone" and I couldn't agree more when he says you eventually get to the point where you "just know." I use technical analysis in my trading and find it a very useful tool but frequently I will abandon my signals and either pass on a trade or trade counter to the signal. Just the other day I got a nice trigger from a small pennant on the 1 min chart of the ES and I just had that feeling, based on how the market was behaving, that the breakout would fail. It did and I took a few points off it on the short side. It was a trade "in the moment" and I "just knew" the move up would fail. I'm curious on your thoughts.
More...

I'm thinking of a number between 1 and 4. What is it?
 
Quote from the1:

Successful trading is based largely on intuition and the ability to adapt to changing market conditions. If you lack either you will not be successful.
More...

I would agree with you.

People may shluff off "intuition" but it has a base in reality and a foundation in experience.

Read and study enough and wait for the bells and whistles to go off in your brain. We may call that a gut feeling and may not be able to qualify our decision but ends up being the correct one.
 
Apparently you missed the words "all knowing" or you just chose to be sarcastic instead. Either way, your response shows complete ignorance on the topic.

Quote from BSAM:

I'm thinking of a number between 1 and 4. What is it?
More...
 
Quote from the1:

Apparently you missed the words "all knowing" or you just chose to be sarcastic instead. Either way, your response shows complete ignorance on the topic.
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Hmmm...You know, pit bulls are actually good dogs. There's no bad dogs, only bad dog owners.

Please excuse my ignorance. I suppose there must be some difference between "just knowing" and "all knowing". I always get confused when people are not clear. Just my ignorance, I'm sure.

I guess you're only omniscient in matters of "just knowing" where the market is going and not in the ability to tell me the number I am thinking of which is between 1 and 4. Seems like my question would be far easier to answer.

I wonder if you believe that average range, time of day, S/R have any validity, and whether perhaps you are subconsciously taking such tangible matters into consideration more so than your psychic abilties, before you pull the trigger on a trade?

(P.S.---Ability to adapt to changing market conditions? Markets do the same thing over and over and over.)
 
At no time did I say I have psychic abilities. There's a big difference between being a psychic and intuition based on price action. And I also stated that I use technical analysis as a tool. I think you missed your calling. You should have been a reporter so you can extrapolate what you want to hear or what your readers want to read from the statements a person makes.

Quote from BSAM:

Hmmm...You know, pit bulls are actually good dogs. There's no bad dogs, only bad dog owners.

Please excuse my ignorance. I suppose there must be some difference between "just knowing" and "all knowing". I always get confused when people are not clear. Just my ignorance, I'm sure.

I guess you're only omniscient in matters of "just knowing" where the market is going and not in the ability to tell me the number I am thinking of which is between 1 and 4. Seems like my question would be far easier to answer.

I wonder if you believe that average range, time of day, S/R have any validity, and whether perhaps you are subconsciously taking such tangible matters into consideration more so than your psychic abilties, before you pull the trigger on a trade?

(P.S.---Ability to adapt to changing market conditions? Markets do the same thing over and over and over.)
More...
 
The problem with TA is that

Y(t) = a + bt

Is not appropriate for most financial time series.

x(t) and x(t+1) are quite correlated.

A simple acf() from R will show you that.

QQ plot and a histogram on the residuals from the lime model will show a substantial trend pattern.
 
Quote from the1:

At no time did I say I have psychic abilities. There's a big difference between being a psychic and intuition based on price action. And I also stated that I use technical analysis as a tool. I think you missed your calling. You should have been a reporter so you can extrapolate what you want to hear or what your readers want to read from the statements a person makes.
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So, you think you are trading on "intuition" based on price action/tech analysis? Really?

You sure you're not just trading on price action/tech analysis?

I don't think psychic abilities...er, uh I mean "intuition" has anything to do with it. You don't just know where the market is going.

Know what the difference is between you and Criss Angel?
Criss doesn't believe in magic. Strange, huh?
 
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