T/A Fails Time and Time Again - Why?

[Handle123]

Great links, I just love this one paragraph from the cognitive inertia link.


One example of cognitive inertia concerns managers at the Polaroid corporation, whose belief that the company could not make money on hardware but only on consumables led them to neglect the growth in digital imaging technologies; because the trend was denied by the prevailing "mental model" of the business, the corporation failed to adapt effectively to market changes

Polaroid one day will be like carbon paper, cork, typewriters, telegraph and many other "had to have" one day devices, if you don't adapt, others will.

Math and the markets is like Spock and people, always interesting as together, they seldom agree. But it is the times when they do agree, patterns, is where one can find low losing percentages. I believe in "time" as I back test and proves to me that longer I stay in a trade that is going no where, lower losing percentages goes up. So I believe in bar counts of time so many bars regardless of factor of time, whether it is one minute bars or weekly, each has a bar count of 3 or 2 of giving the trade long enough to prove it will be going direction of my trade. I think trend direction makes a difference, uptrend require more time whereas downtrend less, up is hope and down is fear. The hurdle of math is it is black and white and price is emotional color, but refine by math rules.

 

[kut2k2]

consider this math is a rock steady constant it will always be the same. to make math adaptive is to spoil what is natural and more valuable than the data it's applied to. let's consider making the data adaptive to our desire rather than expect the math to adapt.

data with time is like concrete without forms it does what it wishes in the time interval observed. we all know that concrete needs to be poured into forms which define it's dimensions irregardless of what the concrete wants to do on it's own.

why then do we allow data to do what it wishes without constraints and expect math to adapt?

I can't believe you're taking the position that there's nothing wrong with the math. Math isn't some gift from a higher power, it is simply a man-made tool designed to explain some aspect of reality. And as with any tool, the designs range from very poor to excellent.

Ask yourself this: how many hammers do you need to pound nails? The answer is one, if it's a good hammer. You don't need 20 hammers to pound nails. Yet there are at least 20 different technical indicators, all supposedly designed to do the same thing: find trends. Why? Because most are poorly designed, especially the early ones. This is not surprising. The earliest tools in any area of work are often the crudest and the ones most in need of improvement or replacement.

Are you seriously suggesting all trend indicators are equivalent and equally excellent if we could only somehow eliminate time?

It isn't time that's destructive. As I posted previously, time is merely the medium in which change takes place. Changes are inevitable, ergo time is inevitable. And some changes are destructive. This is due to entropy, not time. It is entropy which your ire should be directed towards. Time exists to keep everything from happening at once. It's a good thing.

 

[Mysteron]

consider this math is a rock steady constant it will always be the same. to make math adaptive is to spoil what is natural and more valuable than the data it's applied to. let's consider making the data adaptive to our desire rather than expect the math to adapt.

data with time is like concrete without forms it does what it wishes in the time interval observed. we all know that concrete needs to be poured into forms which define it's dimensions irregardless of what the concrete wants to do on it's own.

why then do we allow data to do what it wishes without constraints and expect math to adapt?

Data, aka reality is the truth, math is a tool used by people for creating a model which is an approximation of reality. Always be aware of the limitations of a model and under what circumstances it is not valid.

 

[Frederick Foresight]

Make no mistake we are not just talking about obtaining and edge to be profitable but seeking perfection of understanding price movement.

Perfect understanding in an environment of uncertainty? Good luck with that.

 

[MarkBrown]

From your description, are you sure it's the TA that's failing and not you?

T/A is not failing me because i have set time adrift from my island.

 

[Buy1Sell2]

Folks, we gots ourselves the proverbial wind-up thread. Usual participants. Unsubscribed. Thank you for your time.

 

[MarkBrown]

Folks, we gots ourselves the proverbial wind-up thread. Usual participants. Unsubscribed. Thank you for your time.

the very reason most people fail to be successful at trading is that they don't have the capacity to accept the unknown or even the concept of intelligence beyond their own scope (dreamer, theorist, conceptionist, researchers) all wasting their time to the betterment of mankind?

however how quick the sheep are to embrace a "known" as their own discovery. lol

 

[viktor_k67]

I am an advocate of technical analysis trading. Continually T/A shows great promise and can have it's run of success which is why it perpetuates the notion that it does work. Then it seems just as you leverage up, it fails and wipes you out. Only to get back in sync and start working again as your account has been drained. I went thru this for many years boom and bust...
Mark

TA does not fail, a trader who misses something may fail. In many cases it happens when market changes its behavior.

As an examples, when market becomes more volatile, used technical indicators may start to fail because price starts to change its direction faster and stronger. All you need to do is to adjust your analysis to new levels of volatility. If you do not do it you may end up jumping in and our either too early or too late.

 

[oraclewizard77]

The problem is not the time in math, it's the time in the trader.

TA does not fail, a trader who misses something may fail. In many cases it happens when market changes its behavior.

As an examples, when market becomes more volatile, used technical indicators may start to fail because price starts to change its direction faster and stronger. All you need to do is to adjust your analysis to new levels of volatility. If you do not do it you may end up jumping in and our either too early or too late.

 

[Fractals 'R Us]

Bars of time was just a rather ancient way of distributing data when people made charts by hand.