Technical Analysis Doesn't Work

[marketsurfer]

Quote from Thunderdog:

Uh-huh, sure. And not only that, but with a suitable money management strategy appropriate for each and every one of those "permutations," right?

well, we are dealing with a closed system---there are only so many variables to make basic buy/sell decisions in TA--which is what i assume this thread is about.

can a pseudo random trade entry method make money with proper money management and good trade skills? probably--although likely not much without an edge--so i fail to see the point of including mm in the testing--either TA gives you an advantage on the entry or it does not. different subjects.

surf

 

[stock_trad3r]

TA does work in 1% of cases

 

[Thunderdog]

Quote from NihabaAshi:

Hey All,

My last post in this thread.

This thread has run its course and that usually leads to just personal attacks, name calling et cetera when nothing else meaningful can be discussed.

With that said, this thread is an obviouos candidate for Thread Closure with the evidence that many cannot be professional and that in itself questions the merits of the debate or its agenda.

Hopefully, the moderator (PetaDollar) gets involved and closes this thread soon because it has developed into an eye sore after all that's been discussed from both sides of the camp has been accomplished after you manage to waste a lot of time trying to walk around the mudslinging.

Anybody else thinks this thread should be closed...contact the moderator at the below link.

http://www.elitetrader.com/vb/member.php?s=&action=getinfo&userid=15990

Mark

Mark,

Rather than have the thread closed, I have a better idea. Please tell me what you think of my following suggestion. Rcanfiel claims that TA does not "work." He refers to reportedly exhaustive studies that show no evidence of TA "working." Let us then consider the alternatives. What does "work?" Does rcanfiel have studies showing that fundamental analysis "works" for those traders who do not have earlier access to information than anyone else? In other words, outside of insider information, what statistical evidence is there that FA works, outside of the well-worn anecdotal type of evidence that rcanfiel and marketsurfer dismiss out of hand?

Further, since marketsurfer has recently become a Man of Science, what scientifically valid evidence is there that there are traders who employ scientific/academic statistical principals to positive effect beyond the well-worn anecdotal type of evidence that rcanfiel and marketsurfer dismiss out of hand?

I suspect that if we are to hold all methods of trading to the "rigorous" criteria that rcanfiel and marketsurfer wish to apply to TA, then we will find ourselves having to rename this thread to "Nothing Works." And if that is the case, then what are we doing here?

Rcanfiel and marketsurfer, please respond. Applying the equivalent standards to which you subject TA, to all other forms of trading, please tell us what "works?" And please support your claims with valid, scientific evidence aside from just anecdotal examples.

 

[marketsurfer]

Quote from Thunderdog:

Mark,

Rather than have the thread closed, I have a better idea. Please tell me what you think of my following suggestion. Rcanfiel claims that TA does not "work." He refers to reportedly exhaustive studies that show no evidence of TA "working." Let us then consider the alternatives. What does "work?" Does rcanfiel have studies showing that fundamental analysis "works" for those traders who do not have earlier access to information than anyone else? In other words, outside of insider information, what statistical evidence is there that FA works, outside of the well-worn anecdotal evidence that rcanfiel dismisses out of hand?

Further, since marketsurfer has recently become a Man of Science, what scientifically valid evidence is there that there are traders who employ scientific/academic statistical principals to positive effect beyond the well-worn anecdotal evidence that rcanfiel dismisses out of hand?

I suspect that if we are to hold all methods of trading to the "rigorous" criteria that rcanfiel and marketsurfer wish to apply to TA, then we will find ourselves having to rename this thread to "Nothing Works." And if that is the case, then what are we doing here?

Rcanfiel and marketsurfer, please respond. Applying the equivalent standards to which you subject TA, to all other forms of trading, please tell us what "works?" And please support your claims with valid, scientific evidence aside from just anecdotal examples.

edges absolutely exist, although they are constantly changing and evolving. the ever changing market regimes make this a must. as i stated earlier-- TA is descriptive, not predictive. tape reading, opening orders ( as pushed by bright brothers) sometimes stat arb in the right market, informational arb--to name a few.

truth is, use what works for you. i have no doubt people can and do make money guessing with good money management, with TA with good money management, among the more common approaches---but there is not enough of if any edge and all one is doing is grinding/churning. i prefer to search for niches and edges outside of the grind and churn psych/TA/MM majority. however, fact is, its extremely rare to find TA in day trading rooms as a trading strategy--- ever wonder why--no edge.

surf

 

[Thunderdog]

Quote from marketsurfer:

edges absolutely exist, although they are constantly changing and evolving. the ever changing market regimes make this a must. as i stated earlier-- TA is descriptive, not predictive. tape reading, opening orders ( as pushed by bright brothers) sometimes stat arb in the right market, informational arb--to name a few.

truth is, use what works for you. i have no doubt people can and do make money guessing with good money management, with TA with good money management, among the more common approaches---but there is not enough of if any edge and all one is doing is grinding/churning. i prefer to search for niches and edges outside of the grind and churn psych/TA/MM majority. however, fact is, its extremely rare to find TA in day trading rooms as a trading strategy--- ever wonder why--no edge.

surf

Thank you for your response. However, you did not specifically answer my question. What evidence exists that other forms of trading "work" subject to the same standards that you require of TA as evidence of it working? You have thumbed your nose at TA in various posts in this thread. All I am asking is that you offer the same type of evidence you require of TA for the horse that you are backing.

 

[marketsurfer]

Quote from Thunderdog:

Thank you for your response. However, you did not specifically answer my question. What evidence exists that other forms of trading "work" subject to the same standards that you require of TA as evidence of it working? You have thumbed your nose at TA in various posts in this thread. All I am asking is that you offer the same type of evidence you require of TA for the horse that you are backing.

oh absolutely, you are somewhat skilled in the debate field and written word field, i see. the evidence exists within the nature of the strategy that produces statistically significant edges over random. however, the burden of proof is on the TA true believers. im a trading agnostic, and ready to change at any time once the edge stops working--unfortunately TA believers are not like this, they seem to keep pounding away despite the majority of evidence--why? cause its easy , a quick fix...plus looks wonderful in the past, plus its pushed NON STOP by the very people who want you to trade more and lose--- FX brokers offering advanced charting for free is one example------
surf

 

[Thunderdog]

Quote from marketsurfer:

oh absolutely. the evidence exists within the nature of the strategy that produces statistically significant edges over random.

Excellent! Please provide this proof, as you have required of TA. I look forward to reading this study substantiating your claim. I await your response with eager anticipation.

 

[Lamont_C]

Quote from Thunderdog:

Excellent! Please provide this proof, as you have required of TA. I look forward to reading this study substantiating your claim. I await your response with eager anticipation.

Since this is pretty much what he's demanded of ProfLogic, so do we all

LC

 

[marketsurfer]

Quote from Lamont_C:

Since this is pretty much what he's demanded of ProfLogic, so do we all

LC

proflogic makes claims, i make none. im a trading agnostic seeking edge/niche. burden of proof is on those making the claims, not those questioning the claims. please!

surf


ps. see surf report for record since 2002.

 

[Thunderdog]

Quote from marketsurfer:

...the evidence exists within the nature of the strategy that produces statistically significant edges over random...

Quote from marketsurfer:

...burden of proof is on those making the claims...

I agree. So please prove your above noted claim.