the reason indicators don't work isn't because they're lagging

There is not an indicator or algorithmic function or statistical study or any known means of prediction with certainty when it comes to financial markets. Noted exceptions being illegal activities and outright stealing - and then I'd argue that there is uncertainty as to the perpetrator's future and his or her own personal risk and quality of life.

Traders take calculated risk.

And some methodologies for undertaking this endeavor are much better than others. But in the end, there are no certainties. If you require certainty - I can't think of a worse place to look for it as trading markets. Find a government job with a union, perhaps ?
 
comagnum said:
Indicators report only what is or what has already happened - just like my speedometer reading 55mph only reported what was happening, it did not predict I would drive at 55mph . We both agree on that.
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Inaccurate analogy. Everyone uses indicators to say like if you are going 55mph and it says you are traveling at that speed it means you are going to keep traveling at that speed.
 
1a2b3cppp said:
Most traders don't get this. They say oh adx or whatever doesn't work is because it's lagging.

It doesn't work because it's not predictive.

Because an indicator does something when a trend happens or reverses or whatever doesn't mean that when the indicator does that, a trend is happening. Of course it's lagging, it does calculate based on what price did. But it has no predictive value so it's worthless.

This shocks me to say, but I think volume may actually be a predictive indicator. In some cases.
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In my experience, volume is predictive. I have written code to back test this, and it is profitable. The general rules are:
1. If volume and price are both rising, price is likely to continue rising.
2. If volume and price are both falling, price is likely to turn around.
2. If volume is rising and price is falling, price is likely to continue falling.
3. If volume is falling and price is rising, price is likely to turn around.

I have tested this only on daily bars and 30-minute bars.
 
Steve Alexander said:
In my experience, volume is predictive. I have written code to back test this, and it is profitable. The general rules are:
1. If volume and price are both rising, price is likely to continue rising.
2. If volume and price are both falling, price is likely to turn around.
2. If volume is rising and price is falling, price is likely to continue falling.
3. If volume is falling and price is rising, price is likely to turn around.

I have tested this only on daily bars and 30-minute bars.
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The above in combination with the ten price cases forms a solid foundation in understanding the PV relationship.
 
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