No, as I have said, trading ES is the same as trading the large index. I said nothing about smoothing. My question is how can you apply TA to an index, which also applies to ES.
Tech analysis and futures trading
- Thread starter cafeole
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No, as I have said, trading ES is the same as trading the large index. I said nothing about smoothing. My question is how can you apply TA to an index, which also applies to ES.
This is only my opinion... T/A can show patterns in the ES... Double tops, bottoms, flags, pennants, channels, head and shoulders. The list goes on...Studied Schabacker many years ago.
Thoughts, I would not take an intra-day position based just on T/A.
Take a double bottom.. Add a volume increase and some large delta, yes, get Long, especially if you get a pullback in the second move up..., Vice versa for the Short
Greg
Thoughts, I would not take an intra-day position based just on T/A.
Take a double bottom.. Add a volume increase and some large delta, yes, get Long, especially if you get a pullback in the second move up..., Vice versa for the Short
Greg
Don't worry about the how or why...its too deep and you may fall down the rabbit hole.
Instead, if you're going to use it...backtest it and then simulate trade it prior to any real money application...keep your results to yourself and then ignore comments by others while you're using it.
If it doesn't work for you...stay away from it. If it works for you, you'll quickly learn its not TA all by itself...its that other stuff you need to use with it like money management and many other variables involved in trading that most don't talk about it.
Simply, TA is just one chapter in a book of many chapters.
Yet, if you must explore that rabbit hole...instead wonder why people using charts without any indicators on the chart to help with their trade decisions still consider themself as not using TA.
wrbtrader
You gave me an idea. If you checked each individual stocks RSI and ranked them according to their weighting could you have tomorrows newspaper in you grasp? I need to code a cumulative RSI indicator and put all 500 stocks in it, categorizing them by net weight to the index....lol
ElectricJustFoundAnEdgeSavant
ElectricJustFoundAnEdgeSavant
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You are comparing the behaviour of a basket of stocks (e.g. SP500) to the price of a futures instrument. The basket's value is based on the current value, whereas the futures price is based on the expected price at the expiry date (i.e. in the future). Those are of course two different things.
I'm not so sure about that Hobby lad.
Here's two charts.
First is the S&P proper YTD...
Now the ES for same time period, YTD...
Seems to me that the analysis should work on both the pure index and the future. The charts are practically identical.
@Overnight the difference in value between the index and the future increases when you look further into the future. In other words: when the remaining time until expiry increases. Not all of us are focused on the front month future.
Well, yes, that is a given. But if the difference between the current spot and the future is 3 months, and they move in lockstep, what is the issue? They ALL seem to move and settle in lockstep, so what is the problem between the underlying and the future? I do not follow. And while the Dec ES data is shifty due to the low volume, I reckon' they go on settlement prices. Patterns match. So again, what is the big deal?
Sincerely yours, confused person.
TA offers a brilliant picture of what happened yesterday, but its not so good at predicting what will happen tomorrow. It works in any situation in which you have a large enough sample group of people who can express an opinion and who have the same objective. It is logical to assume that the majority of people will do tomorrow and for the next few days what they did yesterday and last week, because it made them money, the common objective of everyone in the game. Of course, in time some will start to think, "That's enough money made this way, I'm going to look for something else", or "All good things come to an end, I'm going to get out and reverse my position" and so on.
Its very easy to see what people did yesterday, TA is very accurate at this and I am 100% accurate in predicting whether yesterday's prices were up or down. Usually people do what they know and what they know has been good for them before. So its very easy to follow trends. But its very hard to predict what date a trend will start or what date it will end.
I know that is how it is supposed to be. But if it is arb'd the way I have heard, then it is not really doing that. Am I missing something?