Thank for all of your thought provoking posts.
You may enjoy the chapter Bot Destroyer in the book Traders of the New Era, written by a frequent ET poster.
The author, DaaL, being available for questions and discussion on ET is cool.
Popular Technical Indicators for Day Trading
- Thread starter ppy93
- Start date
Thank for all of your thought provoking posts.
You may enjoy the chapter Bot Destroyer in the book Traders of the New Era, written by a frequent ET poster.
The author, DaaL, being available for questions and discussion on ET is cool.
For pair trading that enter and exit positions on the same, should I use correlation or cointegration? For example, the average 1min PL% correlation between GM and F is 0.83 but the correlation between NIO and LCID is 0.59 from Jan 1 to Feb 6.
Both, but CoInt is more important and you need to experiment yourself when you have it not done before. No one can help you here as it gets very technical.
Last edited:
Thank you very much for your advice.
CannonTrading_Ilan
Sponsor
I like FisherInverse for OB/OS.
I like Parabolics as well as Bollinger bands and range bar/volume charts. Some videos to look at here.
I also programmed a few advanced studies that trigger buy/sell signals that you can plug in using sierra charts and we have that available for a free trial. Below is from this morning session
Green square= potential buy, red square = potential sell
I will let you in on a little secret... When all of the time frames are red, all of the bearish signals of indicators would have significantly higher probability of working out. And vice versa when all of the time frames are green.
For the lower time frames I only fall back to the same logic down to the 60 minutes. Below that I use candlestick formations to execute entries and exits.
For the lower time frames I only fall back to the same logic down to the 60 minutes. Below that I use candlestick formations to execute entries and exits.
Why not first find out what information you want to get out of those indicators and then you can code them to do that work for you? Do you really think that it would be anything easier than that in order to make money in the markets? Dan Zanger has assigned different sound alarms to every uptick and down tick so he can get a sense of what the market is doing by "the melody" of the market.
About technical indicators a comprehensive book about from Aronson.
https://evidencebasedta.com/
https://www.wiley.com/en-us/Evidenc...+Inference+to+Trading+Signals-p-9780470008744
What is Evidence Based Technical Analysis
Evidence based technical analysis (EBTA) is dedicated to the proposition that technical analysis should be approached in a scientific manner. This implies several things. First, it is restricted to objective methods that can be simulated on historical data. Second, the historical performance statistics produced by such back-testing are then evaluated in a statistically rigorous fashion. In other words, profitable past performance is not taken at face value but rather evaluated in light of the possibility that back-test profits can occur by sheer luck. The problem of lucky performance is especially pronounced when many methods are back-tested and a best method is selected. This activity is called data mining. Though data mining is a promising approach for finding predictive patterns in data produced by largely random complex processes such as financial markets, its findings are upwardly biased. This is the data mining bias. Thus, the profitability of methods discovered by data mining must be evaluated with specialized statistical tests designed to cope with the data mining bias. EBTA employs such methods.
EBTA rejects all subjective, interpretive methods of Technical Analysis as worse than wrong, because they are untestable. Thus classical chart patterns, Fibonacci based analysis, Elliott Waves and a host of other ill defined methods are rejected by EBTA. Yet there are numerous practitioners who believe strongly that these methods are not only real but effective. How can this be? Here, EBTA relies on the findings of cognitive psychology to explain how erroneous beliefs arise and thrive despite the lack of valid evidence or even in the face of contrary evidence. Cognitive psychologists have identified various illusions and biases, such as the confirmation bias, illusory correlations, hindsight bias, etc. that explain these erroneous beliefs.
Thus EBTA relies on computerized methods for identifying patterns, and combining evidence into useful trading signals. Due to recent advances in computing and data mining algorithms it becomes possible for the modern technical analyst to amplify their research efforts and find the real gold. In other words, EBTA advocates a synergistic partnership between technical analysts and data mining computers to expand the valid base of knowledge called technical analysis. The union of humans and intelligent machines makes sense because the two entities have different but complimentary information processing abilities. Whereas human intelligence has a limited ability to engage in complex configural reasoning, which is required to identify valid predictive variables and combine them into a mathematical function, it can pose questions and proposed candidate variables. Whereas computer intelligence is ill equipped to pose questions and propose variables it has enormous capacities to identify relevant predictors and derive optimal combining functions.
However, this new approach to technical analysis will require that human technicians abandon some tasks they now do and learn a new set of analytical skills. While they will no longer try to subjectively evaluate complex information patterns, they will need to learn about the kinds of data transformations that produce variables that are most digestible to data mining computers. They will also need to learn which data mining approaches are most viable and which types of problems are most amenable to data mining.
David Aronson is the author of “Evidence Based Technical Analysis” (John Wiley & Son’s 2006).
--------------------------------------------------------
A newer book about technical indicators
https://onlinelibrary.wiley.com/doi/book/10.1002/9781118531525
New Frontiers in Technical Analysis: Effective Tools and Strategies for Trading and Investing
About this book
An essential guide to the most innovative technical trading tools and strategies available
In today's investment arena, there is a growing demand to diversify investment strategies through numerous styles of contemporary market analysis, as well as a continuous search for increasing alpha. Paul Ciana, Bloomberg L.P.'s top liason to Technical Analysts worldwide, understands these challenges very well and that is why he has created New Frontiers in Technical Analysis.
Paul, along with in-depth contributions from some of the worlds most accomplished market participants developed this reliable guide that contains some of the newest tools and strategies for analyzing today's markets. The methods discussed are based on the existing body of knowledge of technical analysis and have evolved to support, and appeal to technical, fundamental, and quantitative analysts alike.
• It answers the question "What are other people using?" by quantifying the popularity of the universally accepted studies, and then explains how to use them
• Includes thought provoking material on seasonality, sector rotation, and market distributions that can bolster portfolio performance
• Presents ground-breaking tools and data visualizations that paint a vivid picture of the direction of trend by capitalizing on traditional indicators and eliminating many of their faults
• And much more
Engaging and informative, New Frontiers in Technical Analysis contains innovative insights that will sharpen your investments strategies and the way you view today's market.
https://evidencebasedta.com/
https://www.wiley.com/en-us/Evidenc...+Inference+to+Trading+Signals-p-9780470008744
What is Evidence Based Technical Analysis
Evidence based technical analysis (EBTA) is dedicated to the proposition that technical analysis should be approached in a scientific manner. This implies several things. First, it is restricted to objective methods that can be simulated on historical data. Second, the historical performance statistics produced by such back-testing are then evaluated in a statistically rigorous fashion. In other words, profitable past performance is not taken at face value but rather evaluated in light of the possibility that back-test profits can occur by sheer luck. The problem of lucky performance is especially pronounced when many methods are back-tested and a best method is selected. This activity is called data mining. Though data mining is a promising approach for finding predictive patterns in data produced by largely random complex processes such as financial markets, its findings are upwardly biased. This is the data mining bias. Thus, the profitability of methods discovered by data mining must be evaluated with specialized statistical tests designed to cope with the data mining bias. EBTA employs such methods.
EBTA rejects all subjective, interpretive methods of Technical Analysis as worse than wrong, because they are untestable. Thus classical chart patterns, Fibonacci based analysis, Elliott Waves and a host of other ill defined methods are rejected by EBTA. Yet there are numerous practitioners who believe strongly that these methods are not only real but effective. How can this be? Here, EBTA relies on the findings of cognitive psychology to explain how erroneous beliefs arise and thrive despite the lack of valid evidence or even in the face of contrary evidence. Cognitive psychologists have identified various illusions and biases, such as the confirmation bias, illusory correlations, hindsight bias, etc. that explain these erroneous beliefs.
Thus EBTA relies on computerized methods for identifying patterns, and combining evidence into useful trading signals. Due to recent advances in computing and data mining algorithms it becomes possible for the modern technical analyst to amplify their research efforts and find the real gold. In other words, EBTA advocates a synergistic partnership between technical analysts and data mining computers to expand the valid base of knowledge called technical analysis. The union of humans and intelligent machines makes sense because the two entities have different but complimentary information processing abilities. Whereas human intelligence has a limited ability to engage in complex configural reasoning, which is required to identify valid predictive variables and combine them into a mathematical function, it can pose questions and proposed candidate variables. Whereas computer intelligence is ill equipped to pose questions and propose variables it has enormous capacities to identify relevant predictors and derive optimal combining functions.
However, this new approach to technical analysis will require that human technicians abandon some tasks they now do and learn a new set of analytical skills. While they will no longer try to subjectively evaluate complex information patterns, they will need to learn about the kinds of data transformations that produce variables that are most digestible to data mining computers. They will also need to learn which data mining approaches are most viable and which types of problems are most amenable to data mining.
David Aronson is the author of “Evidence Based Technical Analysis” (John Wiley & Son’s 2006).
--------------------------------------------------------
A newer book about technical indicators
https://onlinelibrary.wiley.com/doi/book/10.1002/9781118531525
New Frontiers in Technical Analysis: Effective Tools and Strategies for Trading and Investing
About this book
An essential guide to the most innovative technical trading tools and strategies available
In today's investment arena, there is a growing demand to diversify investment strategies through numerous styles of contemporary market analysis, as well as a continuous search for increasing alpha. Paul Ciana, Bloomberg L.P.'s top liason to Technical Analysts worldwide, understands these challenges very well and that is why he has created New Frontiers in Technical Analysis.
Paul, along with in-depth contributions from some of the worlds most accomplished market participants developed this reliable guide that contains some of the newest tools and strategies for analyzing today's markets. The methods discussed are based on the existing body of knowledge of technical analysis and have evolved to support, and appeal to technical, fundamental, and quantitative analysts alike.
• It answers the question "What are other people using?" by quantifying the popularity of the universally accepted studies, and then explains how to use them
• Includes thought provoking material on seasonality, sector rotation, and market distributions that can bolster portfolio performance
• Presents ground-breaking tools and data visualizations that paint a vivid picture of the direction of trend by capitalizing on traditional indicators and eliminating many of their faults
• And much more
Engaging and informative, New Frontiers in Technical Analysis contains innovative insights that will sharpen your investments strategies and the way you view today's market.
lol no you wouldn't
I'm actually a fan of Discovery's Gold Rush. The producers and cast probably don't realize it, but it's really a show about trading. I wouldn't mind spending a season up in the Klondike. But no way would I want to spend a winter up there.
For the record, I'm a swing trader, not a day trader. I do day trade, but more "to fuck around and find out" and I have no aspirations to grind it out each and every day. I prefer the easy money of sitting on my hands during a multi-hundred-point S&P swing. But I do day trade the SPX's bastard step-child ES a little bit from time to time. IF I do, it is usually during that opening hour which you mentioned is also your cup of tea.
When I read your post saying "if your trade lasts more than 5 minutes you're an investor," I laughed and thought "right, we'll see about that." I was sure my trades were probably 15 to 20 minutes on average.
So, I went to the Ninjatrader and ran my trade performance from Friday. to see what my average time in market per trade was, and I really had overestimated how long my trades lasted on Friday.
Average time in market was only 3.10 minutes per trade!
I'm not sure what that says about me and my own situational awareness, but I'm sure it isn't good.
USDJPY Finds Sellers Near Swing Level and Tumbles:
There is a lot of volatility seen in the USDJPY over the last few minutes.
The high price reached 157.19, which was just short of a slain level going back to the intervention period at 157.23. The subsequent tumble took the price down to 156.53, which was just above the low for the day at 156.22.
The price has since rocketed back to the upside in trades back above the 157 level at 157.06 currently. A move above 157.23 would open the door for further upside momentum with 157.989. That is near the high price going back to May 1.
There is lots of up-and-down volatility
There is a lot of volatility seen in the USDJPY over the last few minutes.
The high price reached 157.19, which was just short of a slain level going back to the intervention period at 157.23. The subsequent tumble took the price down to 156.53, which was just above the low for the day at 156.22.
The price has since rocketed back to the upside in trades back above the 157 level at 157.06 currently. A move above 157.23 would open the door for further upside momentum with 157.989. That is near the high price going back to May 1.
There is lots of up-and-down volatility