the basic assumption of TA
- Thread starter seesound
- Start date
Quote from jay gould:
After they happen, ofcourse.
Furthermore, is this why citigroup fired it's entire TA department??
Actually you have stated only half the story and then jumped to conclusions. If you had followed up, citigroup actually outsourced their TA to Dorsey. Similar to how firms outsource their IT departments. The fundamentalists are there to state or give some reasoning/explanation to their ignorant investors as to why the stocks picked by citi didn't make money (bad economic/company surprises or conditions and other bullsh etc) or to justify the reason why they place money on the specific stocks so it make sense to the laymen... (PE ratio, etc). But basically I think they use both FA and TA.
http://www.thestreet.com/_rms/markets/marketfeatures/10209990.html
I'm a newb too, but read the training section on ET. Backtesting and why it's good although it can't predict the future is discussed at length. It makes a powerfull argument for it.
No type of plan/strategy/indicator/guru course can predict the future of the market and jump right in at the perfect time with absolutely no drawdown and all profit, that's the reality.
Backtesting at least gives you a window on what your strategy might have done, and a way to tweak it out, then hope it can do that in the future.
Read the training section, trading as a business, it will explain it better that I'll ever be able to.
Hi guys,
Don't try to ape science by attaching too much importance to some kind of a corpus called TA.
Simply find some tricks that make you money. Doesn't matter how you got there.
If a wet finger or a rabbit's foot will do, equally respectable as Trend & TA.
nononsense
Don't try to ape science by attaching too much importance to some kind of a corpus called TA.
Simply find some tricks that make you money. Doesn't matter how you got there.
If a wet finger or a rabbit's foot will do, equally respectable as Trend & TA.
nononsense
Over the years we have been involved in many discussions about the tools of the trading game, some serious, some tongue in cheek, and some just downright silly. The people who tend to force their point of view, elaborate into minutia, and spend the most time on the concepts, have always worried me the most (while making me chuckle).
TA is simply a tool to look at what has happened (past performance), and so is fundamental analysis (last quarters financials). If you interpret patterns and then give them names, and then give those names to enough people so they can communicate in a similar language when comparing these similar patterns, then you have a "language." Now a natural process of attempting to pre-guess your flock as to what the future will bring, thus causing a chain of events can cause pricing movements. The "self fulfilling prophecy."
Allocate of piece of the "thought process" pie for trade entry/exit.
Allocate another piece to fundamentals (if a good business is run by smart people in a capital market, then they should succeed, at least for the short term).
Allocate another piece to news events.
Allocate another piece to competition (what's the "other guy" doing?).
There is no "right or wrong" - there is simply "what is."
Buy a stronger stock based on several criteria.
Short a weaker stock based on similar criteria.
Trade the movements within a historical range (you pick, perhaps 6 months, perhaps an average of 2mos, 6 mos, and 3 years, whatever you feel makes sense).
This is simple and profitable.
BUT...even with all this analysis, do we add "layers" at 10% increments? 20% increments? Do we enter longs at a different time than our short sale entry? Answer: Maybe.
And that's the point I'm trying to make here. Don't get too involved in any language, analysis, theory, system, or trading program. Learn what you can, and simply trade based on a few pieces of that pie above. If we can be right more than we're wrong, and keep our profit targets and risk parameters in line, then we should do ok.
The market "pitches" to us, we simply swing the bat.
We make money by providing 2 sided markets, and seeking out anomolies, nothing more, nothing less.
Our portfolio group spends 10 hours a week minimum (after market hours), trying to fine tune our course...and the course changes, and changes often. We had average profits in the 6 figure range last month (per person), and, yes, we have lost (5 figure average) at times in the past....so, as we continue to adapt, we should get better. The same thing happens with any learning curve.
Do what works, fix what doesn't.
Sorry to ramble on, just my 2 cents.
Don
TA is simply a tool to look at what has happened (past performance), and so is fundamental analysis (last quarters financials). If you interpret patterns and then give them names, and then give those names to enough people so they can communicate in a similar language when comparing these similar patterns, then you have a "language." Now a natural process of attempting to pre-guess your flock as to what the future will bring, thus causing a chain of events can cause pricing movements. The "self fulfilling prophecy."
Allocate of piece of the "thought process" pie for trade entry/exit.
Allocate another piece to fundamentals (if a good business is run by smart people in a capital market, then they should succeed, at least for the short term).
Allocate another piece to news events.
Allocate another piece to competition (what's the "other guy" doing?).
There is no "right or wrong" - there is simply "what is."
Buy a stronger stock based on several criteria.
Short a weaker stock based on similar criteria.
Trade the movements within a historical range (you pick, perhaps 6 months, perhaps an average of 2mos, 6 mos, and 3 years, whatever you feel makes sense).
This is simple and profitable.
BUT...even with all this analysis, do we add "layers" at 10% increments? 20% increments? Do we enter longs at a different time than our short sale entry? Answer: Maybe.
And that's the point I'm trying to make here. Don't get too involved in any language, analysis, theory, system, or trading program. Learn what you can, and simply trade based on a few pieces of that pie above. If we can be right more than we're wrong, and keep our profit targets and risk parameters in line, then we should do ok.
The market "pitches" to us, we simply swing the bat.
We make money by providing 2 sided markets, and seeking out anomolies, nothing more, nothing less.
Our portfolio group spends 10 hours a week minimum (after market hours), trying to fine tune our course...and the course changes, and changes often. We had average profits in the 6 figure range last month (per person), and, yes, we have lost (5 figure average) at times in the past....so, as we continue to adapt, we should get better. The same thing happens with any learning curve.
Do what works, fix what doesn't.
Sorry to ramble on, just my 2 cents.
Don