TA - Objective or Psychological Skill?

[Lucrum]

Quote from marketsurfer:

2. Wrong. I only want others to think for themselves. I could care less if you or anyone else believes what I have to share.

Then why the non stop obsession with trying to convince everyone to abandon TA? Something you've been engaged in for years.

3. You have over 30k posts, do any of them add one bit of value to the trading community?

There are a few, believe it or not.
Do you consider demonstrating how to lose large sums of money a better "value add" than those who point out the poor money/trade management inconsistencies and complete lack of entry timing?


(Did you forget you put me on ignore - again) LOL

 

[cornix]

Quote from jem:

which harkens back to a point earlier in the thread about the Predictors. They could not make squat til they brought in a scientist who was real trader. Which is about when the book goes silent.

for instance the anti t/a crowd say whether the market is up or down is random.

The trader says... well what if we recently saw a 52 week high we had a two day pullback and the price of oil is down. How do I like the trade at morning support. How I put enough of the recent tendencies in my favor.

When you trade well you take a lot of factors and make good decisions.
When you lose you see all those things afterwards.
When you lose a lot you say none of those things work.

In short perhaps you were just not cut out for trading.
Although I don't play poker much when you play with friends you can see that some people can't handle risk and probabilities with where there are at that stage of their lives. Then sometimes things change and all of a sudden they play better. Luck? yeah some of it.. but approach is another factor.

Very good points, Jem.

That's exactly what I meant to say too. There are many inputs in every trading decision. Outsiders only see a tip of an iceberg like "resistance breakout", when in reality it's resistance breakout which is only legit when a dozen of other factors is in place. They are usually objective being analyzed thoroughly, only seem to be subjective, often to a trader him/herself just because they are not conscious enough.

I am psychologist as many here know and I analyze my own actions as a trader from this point of view. Every time I had intuitive "feeling", which eventually morphed into a logical rule it happened, because subliminal information became conscious. There's always some logic behind a reasonable decision. Just not always fully understood by us yet.

So back to "academic researches"... if those academics just take raw setups from books or whatever other place and test them as they THINK they should be tested it's about the same as test neurosurgery on patients without actual experience in the field wondering why those patients tend to die so often... neurosurgery must be a delusion.

 

[cornix]

Quote from marketsurfer:

You seem to lean toward intramarket analysis, Jem. There is proven value in this type of study. My issue with TA is the folks on this thread who claim they only look at one instrument, learn its patterns, then have the ability to trade at a high accuracy rate. This is rubbish. surf

Accuracy may be high or low (my live experiment so far shows 41% win rate approximately as can be read in the journal). It doesn't matter. What only matters in this business is profit relative to the risk taken.

Losers care about the win rate too much, cause it's a matter of being right or wrong which is an issue for them. Who makes a living by trading cares of how much $ is made, not some secondary figures.

And yes, it's certainly possible to look at one market, even one chart of one market and consistently profit from it.

 

[cornix]

Quote from marketsurfer:

Whoa, this is starting to sound like I am questioning someone's faith rather than a trading tactic.


I guess you will never understand the difference between being critical of a method and critical of a person.

surf

Tell you one thing: in the game of probability you better believe in your strategy/tactics indeed. Otherwise it becomes almost impossible to stay disciplined in doing what should be done.

That's what happens to many traders: they don't have a method developed and tested well enough, but start trading it live. Not being confident in it they are not disciplined... as a result it turns on them and they end up losing... and blaming it on methodology (TA variation or whatever).

Vicious self-fulfilling circle... so if you ask me, yes faith or rather confidence is important too.

 

[marketsurfer]

Quote from cornix:

Accuracy may be high or low (my live experiment so far shows 41% win rate approximately as can be read in the journal). It doesn't matter. What only matters in this business is profit relative to the risk taken.

In other words, TA based entries have a less than 50/50 chance of being accurate? Why would you believe they have anything to do with your success? In fact, it sounds like TA is hurting you.

Why couldn't random entries produce the same or better win rate? Apply money management, and random entries sounds like an equal or potentially better system.

surf

 

[justrading]

Quote from marketsurfer:

In other words, TA based entries have a less than 50/50 chance of being accurate? Why would you believe they have anything to do with your success? In fact, it sounds like TA is hurting you.

Why couldn't random entries produce the same or better win rate? Apply money management, and random entries sounds like an equal or potentially better system.

surf

Isn't it simplistic to assume that random entries will give 50/50 win/loss?

Use of stops changes the performance of any system as compared to no stops. Wide or tight stops similarly impact upon system performance.

People use stops to avoid crippling trades and blowing out accounts, ie accept small losses so you live to fight another day. I've lost count of the number of times I have been stopped out and at some later point price moves back past my entry. That's just one of those things, I don't have Buffett's pockets.

 

[marketsurfer]

Quote from justrading:

Isn't it simplistic to assume that random entries will give 50/50 win/loss?

Use of stops changes the performance of any system as compared to no stops. Wide or tight stops similarly impact upon system performance.

People use stops to avoid crippling trades and blowing out accounts, ie accept small losses so you live to fight another day. I've lost count of the number of times I have been stopped out and at some later point price moves back past my entry. That's just one of those things, I don't have Buffett's pockets.

Yes, it is simplistic. If TA provides anything less than 50/50, why use it as an entry tool? Obviously the more positive runs you have after entry, the $ you will make. Having 40% or so of your entries make money means 60% are losing--- clearly there is no ADVANTAGE to using a tool that produces 60% losers on the entry. Add in the Vig and that seems equal or worse than the results available without using TA. What am I missing?

 

[wrbtrader]

Quote from marketsurfer:

...Why couldn't random entries produce the same or better win rate? Apply money management, and random entries sounds like an equal or potentially better system.

surf

Depends on the context...

Random Entries versus Losing Trader

Random Entries versus Profitable Trader

I don't know a lot about "random entries" but I do know profitable traders. I'm willing to bet that a profitable trader with money management will outperform random entries with money management.

 

[marketsurfer]

Quote from wrbtrader:

Depends on the context...

Random Entries versus Losing Trader

Random Entries versus Profitable Trader

I don't know a lot about "random entries" but I do know profitable traders. I'm willing to bet that a profitable trader with money management will outperform random entries with money management.

Here is a lesson in random entries:

http://intel.harriman-house.com/trading/testing-random-entries/

Profitable trader predisposes that this trader uses money management-- remember, cornix is on the way to proving that TA only provides 40% or so winning trades-- yet he stil makes money. He would make money regardless of TA-- in fact TA hurts his performance. To sum it up

TA IS A DELUSION-- but this does not mean that TA users can not make money. Astrologers can also make money in the financial markets.

 

[sheda]

Having 40% or so of your entries make money means 60% are losing--- clearly there is no ADVANTAGE to using a tool that produces 60% losers on the entry.

Who needs an advantage when you can control the size of your loses and over all bring in much more in than you lose? An entrys a starting point, 40% wins would be enough for me to pay for a house tens and tens of times over, as opposed to the one mortage I would spend 20-30 years paying off from a 9-5, the markets about making money.

remember, cornix is on the way to proving that TA only provides 40% or so winning trades-- yet he stil makes money. He would make money regardless of TA-- in fact TA hurts his performance. To sum it up

TA IS A DELUSION.

Cool, so you will trade the same time frame as him, you using random entrys and he using TA, and your results vs his on that time frame will teach him that lesson, then he can convert.