I have seen and read tons of videos and books about TA indicators and other techniques (Fib , GANN, Eliott,..etc) I didn't get convinced as for example in Fib it relies on a magical number !!
and Elliott is very subjective and relies on the idea that market repeating itself!
but what about indicators like MA,stoch,MACD . are they reliable with price action or do I just stick with naked price action and dig deeper into it?
I really need some advice.
Most people I believe get wrong idea of indicators, it is easier to understand them "after" you have become very good with charting and want to expand one's knowledge or you want to make it easier to use automation, very tough to program charting patterns, and not talking about seven or eleven labels most give them like triangles or wedges, but what has happened one bar or past three hours, patterns of patterns of patterns. Or as simple as six points from a low, which low, the strength of that low from where? Whereas you can find an oscillator or unique moving average that can mimic six points.
Let's take "RSI's", I have used them since 1980s, so for a solid 25 years they were on my charts and they are not on my charts, I know what the RSI is doing in regards to the chart, I can see divergences even when I add volume to the mix. Oscillators are a bit different as I have added Quantum Physics to get final indicator, this is not to get an edge on retail, but Hedge funds, am more interested in outfoxing the fox. An trying to find how low is low or how high is high within waves, and fibs/Gann don't seem to come close and price itself doesn't give a clue, and trendlines are like anything else-sometimes.
Indicators are tools to give you understanding if they are giving you percentage edges or not, back testing will never be the same results in actual trading however, can be better or worse, but should come out near. And when you back test, have to include reductions of one tick and fees, if this seems too much, then you need to change the system and making too little return. And farther back you can back test using tick data, more reliable the data coming out of the test.
Am friends with a very good "Fib" trader, she been using them since 1980s, but uses them differently than most, much more conservatively, far less trades as she waits for multitude of different timeframes to have same area line up. She says by waiting you have several different groups all entering at same time, and I believe what she says as when price hits these key areas, price seldom comes back.
Unless your really gifted and your account shows this to keep scores, you have to have well developed trading plan, as entries means the least unless you scalping for ticks.
So what you asking is all TA good for entries? That is where being able to read price comes in for managing the trade, using MAE/MFE helps, but overall entries is least of your concern, entries will do one of three events, get in early, get in late, get in right.
I been playing too long at the game, almost all that I started trading have taken their dough and fully retired to play golf or piddle in garden. I can't stand to do either, so I am developing less systems than a year ago and those already developed, finding way to make them better. The only way you can make something better is knowing an area is not your best work or happy enough to let it be.
If I was starting out, learn price well, learn it so well you no longer have to think about it, like how do you tie your shoe.
Good luck.
