TA - Objective or Psychological Skill?

[justrading]

Quote from marketsurfer:

The article was deemed not even worthy of comment.

You and your associates were supposedly going to review it, until Hershey questioned the lack of footnotes citing studies supporting the various assertions in the article, at which point you magically declined further review.

Forgive me for being blunt, but the arrogant stupidity underlying that attitude would mean we would not be using penicillin (including its derivatives) or x-rays today. Both were accidental discoveries, devoid of all scientific rigour in the process.

An open mind and willingness to examine something before discounting it seems to be an endangered concept nowadays.

 

[cornix]

Quote from marketsurfer:

Whoa, that's a mouthful---

What TA patterns are "proven to work"? this is a non sequeutar anyway-- as TA patterns ONLY EXIST IN THE PAST therefore, the ALL have worked otherwise they wouldn't and couldn't exist.

Can you explain the exact tests you conducted and the results. What was the data set? Can these "tests" be replicated?

No offense meant, just trying to correct faulty beliefs.

Correct, TA patterns constitute past action, but as markets are reflexive, some TA patterns being the past, change the probability of certain price action in the future.

As for "which"... well, those I use and those other profitable TA traders use (there are many of them).

 

[cornix]

Quote from marketsurfer:

The article was deemed not even worthy of comment. I believe TA is useful to design a context from which to make decisions, not as a decision making tool itself. TA is illusitrative not predictive, therefore, if is not predictive, why would random entries have any less of a chance for success than non predictive TA entries? There is a major fatal flaw in the "logic" behind TA. Think about it seriously, you know i make sense>

surf

Tell me one thing: do you believe random entries can provide consistently profitable trading approach or not?

 

[cornix]

Quote from wrbtrader:

Note: I've already establish that cornix does have a habit of implying he uses TA and nothing else when in fact he does uses other things with his TA. Please try to remember such when you reply to him.

By the way, cornix stated a few replies ago to me that he was using something call PD as in price drivers...maybe with sarcasm.

Think we need a bit of clarification here.

When I say I use TA, it means that TA pattern is the only reason for entry. Obviously statistics, position sizing, money management et cetera are also used as you repeated more than once before. You are absolutely right that unlikely just TA would "work" in this sense.

If it's what you meant saying most traders use more than just TA then we absolutely agree about this point.

P. S. I only mentioned PD's (Price Drivers) to compare with TA entries, because all I know about them is Surf's trades.

 

[marketsurfer]

Quote from cornix:

Tell me one thing: do you believe random entries can provide consistently profitable trading approach or not?

No different than an objective pure TA approach with zero other than inputs than price/volume. surf

 

[marketsurfer]

Quote from cornix:

Think we need a bit of clarification here.

When I say I use TA, it means that TA pattern is the only reason for entry. Obviously statistics, position sizing, money management et cetera are also used as you repeated more than once before. You are absolutely right that unlikely just TA would "work" in this sense.

If it's what you meant saying most traders use more than just TA then we absolutely agree about this point.

P. S. I only mentioned PD's (Price Drivers) to compare with TA entries, because all I know about them is Surf's trades.

Yes, you were misqouted by WRB. I understood what you meant earlier.

surf

 

[Lucrum]

Quote from marketsurfer:

You just don't see it because you are blinded by the religion of TA. Maestro's points literally destroy the notion of what you call TA. surf

NO smurf, YOU are blinded by your contempt for TA.

 

[marketsurfer]

Quote from Lucrum:

NO smurf, YOU are blinded by your contempt for TA.

I love TA but only for what's its for. It's not for what you use it for, making trading decisions in real time. Rather, it provides a context from which to make a decision instead of a buy/sell. Yes/no decision. Does wise trade work? That's based on TA---- Red light sell, green light buy all from objective TA. You know it doesn't work. So why would any other objective TA work? You want me to think you are special, have secret powers?

 

[Mr Super Trader]

Quote from cornix:

Correct, TA patterns constitute past action, but as markets are reflexive, some TA patterns being the past, change the probability of certain price action in the future.

As for "which"... well, those I use and those other profitable TA traders use (there are many of them).

Let me get this straight are you saying T/A is almost like a lagging indicator.

When we talk about double tops, triple tops , wedges , flags all these types of CLASSIC T/A that people charge money to teach and write books about. I will agree that these classic patterns are always showing on charts but the failed times you can't see because your mind is not looking for the failed double top that turned into a breakout or the failed double top that turned into a triple top. And so on. I do believe however that support and resistance works just fine as long as your reward is greater then your risk. On a five minute chart not so much on a weekly chart or daily chart support and resistance with the correct parameters works great. Stop hunter traders like my self make do fairly well trading broken support or resistance due to orders that are place at these levels.


If I operated a hedge fund I would use these patterns as an exit plan. If volume is increasing after a consolidation period and I am happy with my profits I would sell into the liquidity that investors are buying into believing that a breakout is happening. I get out without lowering the price on myself. If I dumped enough capital this would lead to a false break out. I also would have initiated the breakout and waited for biters.


I have a set of T/A that I trade as for all I know it may be original or others may trade what I trade as well. As I have mentioned the exit strategy is why they work. I have never seen it published.I am doing fairly well relative to the capital I am trading. Just a naked chart. I don't at the moment have hundreds of thousands of dollars to trade. But none the less I am a profitable trader using T/A solely. I have also posted my results.

The last thing I am going to do is post real time as my strategy is my work not free to the public.

The problem I have is traders in general have always lacked originality. And your disproving of T/A is only based on classic chart patterns that guru's rip new investors off on a daily basis. So to your credit maybe your article is good constructive criticism for traders who lack originality whom are struggling trying to get rich off patterns that everybody knows about. So yes a lot of these patterns are ambush's . You can't go buy a book like Trading in the Zone and all of a sudden you are a profitable trader.

My problem with your philosophy is you personally don't know of all the original strategies that people trade. Therefore disproving T/A would be impossible.

Also you seem to act childish and make false accusations. And then sometimes you act reasonable. Maybe if you want some type of credibility you should change the way you act and maybe you might be surprised of the compromise you may receive.

 

[NoDoji]

Quote from marketsurfer:

TA is illusitrative not predictive, therefore, if is not predictive, why would random entries have any less of a chance for success than non predictive TA entries? There is a major fatal flaw in the "logic" behind TA. Think about it seriously, you know i make sense>

surf

TA is predictive. It allows one to predict the odds of price movement A occurring before price movement B.

By combining these odds (win rate) with the ratio between the price movement A and price movement B, one can find technical price action patterns that offer positive expectancy sufficient overcome trading expenses and result in a net profit over each series of N trades.

I addressed this in another thread yesterday:

http://www.elitetrader.com/vb/showthread.php?s=&postid=3829797#post3829797

FWIW, I think I saw a unicorn on ET recently:

http://www.elitetrader.com/vb/showthread.php?s=&postid=3829840#post3829840

His reply --- hourly candlestick price action --- makes it sound suspiciously like he's using charts and candlesticks and the action of price (all of which is illustrative hindsight stuff) to generate a profit that ET's resident Dad, EMG, has deemed impossible with just 2 contracts of ES and no adding to losers.