Technical indicators are they any good?

Quote from vanilla2:



I wish :) I assume you mean the Bruce Lee wisdom. He would have been a great trader. Assuming he didn't bust up the screen on every stop out.

I forgot to mention that my personal reliance on historical distributions of strategy variables (like indicator periods etc), is based on agnosticism about where price will go. If you have a strong belief that you see a setup forming, and discretion weighs into your trades, than trusting a backtested result is painful or impossible.

I'll can it now before I pollute this thread with off topic stuff. Hope this is helpful in any way.
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Agree (not off-topic :-) ).

I would say there are two schools of validating approach: Back-testing (including Forward-testing) which is not real-time, and Realtime-papertrading which is of course real-time.

Agree again, sometimes a trust in some back-testing results could cost someone something.
:mad:
 
Quote from Bolts:



Yes I had a sort of curve fit in mind, position exit time as some function of indicator period time. To clarify, there would be a completely different function for each indicator of course. But I see your point about backtesting being better than any theory could be. So I guess it wouldn't be of much use to most traders, but maybe it would be useful for trading something that could not be backtested well, like IPO's for example.
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Let me guess, you're doing a mba project, isn't it? :D
 
The more I think about it, I think I am getting your point Funky. Almost every indicator is parsing price into some form of crossover, overbought/oversold, slope, and/or divergence information. I think what you're saying is that there is an art to interpreting this information, and every indicator period you use is giving you the same information, just with a different level of sensitivity. So, the art would be feeling out the indicator periods that best fit your desired trade timeframe and style, most of the time.

Like in your analogy, a fiat and a porche both drive, just at different speeds, and with different levels of sensitivity to the road. Either will get you there as long as you know which one you're driving.
 
Quote from vanilla2:

The more I think about it, I think I am getting your point Funky. Almost every indicator is parsing price into some form of crossover, overbought/oversold, slope, and/or divergence information. I think what you're saying is that there is an art to interpreting this information, and every indicator period you use is giving you the same information, just with a different level of sensitivity. So, the art would be feeling out the indicator periods that best fit your desired trade timeframe and style, most of the time.

Like in your analogy, a fiat and a porche both drive, just at different speeds, and with different levels of sensitivity to the road. Either will get you there as long as you know which one you're driving.
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In a trend use trend stuff. i.e. MA's. In a choppy market use divergence or OB/OS stuff, i.e. RSI, Stohs. That simple. Figuring out the trading environment is the hard part.
 
Quote from OddTrader:



Let me guess, you're doing a mba project, isn't it? :D
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LOL, no! Is that the sort of thing they do? Maybe I'm not really thinking outside the box afterall. :p
 
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