Technical Analysis = CRAP

[marketsurfer]

Quote from d08:

This is a great comment, read this twice surf. When you discover a second edge which is significantly different from the first, you realize there must be many out there.

Absolutely, there are many edges. The problem lies in the fact that edges are ever changing. Fixed systems such as charts ( fixed inherently) don't adapt to changing edges and are insidious since there is always one working and past examples are everywhere.

Commenting on the incessant and noxious personal attacks from this person ( whom words you call great comment) would be futile. I trust the readers will notice the gonzo hate vibe pattern thus pay it no mind.

Thanks,

Surf

 

[cvds16]

Quote from emg:

think about this. Has any of your TA works? Can you explain why more than 90% of small traders lose in a "Spectacular Fashion."

If a trader has $1 million in his account and begin 1 contract in let say crude oil, can he make money without using the chart?. All he has to do is:

10 cents profit target. If crude goes against him, he add 1 contract. if it continues to go against him, he add another contract and so on. If crude did not hit his profit target at the close, then he will swing trade until crude hit his profit target.

It is very possible to make $100K profit per month trading crude with a $1 million account. And guess what, with $1 million account and begin trading 1 contract, there is no heat. No heat at all.


Hope this help. Good luck

tell that to the guys that bought oil when it was over 140 USD, my guess is they lost it all and some .... pfeeeeew .... 1 million down the drain .... MORON !

 

[RCG Trader]

Quote from marketsurfer:

Absolutely, there are many edges. The problem lies in the fact that edges are ever changing. Fixed systems such as charts ( fixed inherently) don't adapt to changing edges and are insidious since there is always one working and past examples are everywhere.

Commenting on the incessant and noxious personal attacks from this person ( whom words you call great comment) would be futile. I trust the readers will notice the gonzo hate vibe pattern thus pay it no mind.

Thanks,

Surf

Back to intelligent debate then, chart structures are fixed, true, but price movement volume and volatility over that fixed frame are all variable. Changes in the price volatility can give a trader the opportunity to position himself accordingly.

 

[Handle123]

Quote from the1:

You're still missing the point. There is definitely an inherent weakness with technical indicators. One you mentioned and the other being that they are derived from price so it's kind of like the tail wagging the dog. However, if you use a certain tool over an extended period of time you tend to learn how to "interpret" its meaning. For example, suppose you use a MACD histogram with the default settings. If you're brand spanking new to trading it's going to be of little help but if you've been using it for 5 years you'll know when to trust it and when not to because experience allows you to develop the ability to "read" the markets. It's the art of "just knowing" that's based on "I've seen this before." It's no different than learning how to fly a plane -- it takes time and after enough time the pilot knows when to zig and when to zag.

I totally agree, there are weaknesses to any indicator, they are slow, they will not turn as like raw price, but I find beauty in this as right there is a perfect rule cause the indicator is slow. Indicators can slow down one's trading to force one from overtrading. We all want to the take the best of the best signals, the ones that have the smallest losing percentages. From day one in 1980, I have used some form of TA, back then it was EMA cause I had to do long hand and my charts with graph paper, but after all these years, 99% of the time, I can judge what an indicator will do in relationship to price and that odd 1% is an oddity that often makes money. Can spend a lifetime studying price and another life time studying indicator relationships to price, each produces different patterns.

Also, too many traders only go with what a book says on how to use an indicator and when it doesn't work, it is called "Crap". But one has to think outside of the box, look for relationships that are not covered in the book, cause the 95% are going with what the books say.

 

[crazyAtrader]

Use price to enter, not only is it faster, it's more reliable.

Crazy A

 

[crazyAtrader]

Quote from emg:


It is very possible to make $100K profit per month trading crude with a $1 million account. And guess what, with $1 million account and begin trading 1 contract, there is no heat. No heat at all.

No offense but this is what you are claiming.

Roughly 10% per month, equivalent to 120% per year.

You giving your lack of experience away, but I don't blame you, we all start by developing these crazy theories; what sucks is that people actually come here and post this nonsense, and the sad part is that you actually believe it, eventhough you have not done it because it cannot be done.

Anyone that has been in the game for a long period of time knows without a shadow of a doubt that what you are claiming is impossible to achieve on a consistently basis and the sooner you learn this the better because in the meantime your capital is at risk.

Best of luck and hopefully the readers reading your claim don't actually believe such fallacy.

Crazy A

 

[jsfsn]

Quote from jsfsn:

@marketsurfer
I'v posted twice in this thread hoping you would address some of the arguments I brought up (if one can call them that...). Here are two papers that I would like you to comment on:

http://research.stlouisfed.org/wp/2011/2011-001.pdf
http://www.technicalanalysis.org.uk/technical-analysis.pdf

The TED-talk linked here earlier does not argue that TA does not work. All patterns are not constructed/fake (as in not working to predict price movements) and may repeat them self more often than others.

To bring the favor over to the trader counting spreads / commission is not the same thing, however. I'm not convinced that someone can make consistent profit using TA, but I do believe that you can set a probability on price.

I'll bump this. Two of many papers that show that TA works. Keep in mind that the researchers probably has less skill than a lot of traders.

 

[tortoise]

Quote from Fireplace:

I have such a system and I do trade in size in both the ES and the SPY....but only when I have the odds really in my favor. Sometimes that's only twice a day, other times its like 8 or more.

I trade not because I have to anymore but because I fully love it and can't imagine doing anything else. Maybe when I get older I will slow down and find other interests that capture my attention like trading but that is at least 15 years away.

I wish I were you. I hate trading. Such a fucking bore. I can't understand how anybody likes trading. Then again, I don't get the allure of sitting in a duck blind, or ice-fishing, either.

 

[Maverickz]

Quote from crazyAtrader:

Use price to enter, not only is it faster, it's more reliable.

Crazy A

Of course you use price to enter, but you have to use TA to determine what you want the price to be for entry.

 

[Fireplace]

There is no way to improve what you currently do?
I agree waiting for the proper setups to gel can be annoying sometimes but I've come to the understanding that there is nothing I can do about it so I try and not let it bother me.

Do you have any hobbies outside of trading?

Quote from tortoise:

I wish I were you. I hate trading. Such a fucking bore. I can't understand how anybody likes trading. Then again, I don't get the allure of sitting in a duck blind, or ice-fishing, either.