If my father were a successful trader, he would helped me minimize trials and errors and shorten my learning curb. When I become a successful trader, I will teach my son trading so that he can quickly become a successful trader.... Your family members or close friends can become the best mentors I think. Other people would not like to bother to spend their time to teach you or to expose their edge....
Trading with/without a mentor?
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Makes a lot of sense. The NYSE specialist operation was heavily kept within families for many years.
Agree and i don't think that any other person would teach you trading in that way, that's the reason i say one should avoid spending money on forex courses.
I'll just add something to this discussion. If you don't like the idea of applying TA to the indexes I will offer you an explanation why this does work. But, it's kind of advanced!
Look at this chart. It overlays two instruments. The long bond future in red and ES in white.
If you can do technical analysis on the rate futures, then you can just reverse the buy/sell signals and you can trade the index using it!
Now, anybody can see that the bonds are bullish. The rate futures trade inversely to the index futures. This is called risk on/risk off. Money is moving from stocks to bonds when the index is falling. But, stocks can also rally with bonds! Or both can drop! That's why trading is hard. You have to be better than the rest if you want to survive.
Thanks for that... the frequent inverse correlation between Stocks and T-bonds is often used as a hedge and sure, the general correlation can be seen on a graph, but how does this prove that TA on an index, that lumps individual components together, works? I mean, take the DOW, for example, say BOEING moved up 5% due reasons specific to the stock, and the other 29 components remain flat, I can't see how TA on the index will predict the up move, let alone predict the 90 or so pts.
But the Dow is a "special" index. It is the only price-weighted average, and is only 30 components!
I think the Dow is an exception in this case, especially during the height of earnings season. We have seen countless times where the Dow and the other indices disconnect, simply because of large moves by the few heavyweights in the Dow.
There are many things that are moving the index. Eurostoxx50, FDAX, treasuries, sector rotation, price action in the individual components, and even (like Overnight says) Trump tweets.
There are even robot speculators that build up $100,000,000 positions and dump them as soon as they are profitable!
The point is that the treasuries DO respond to price action analysis! The treasury market is so deep, and so liquid, that the TA does work A LOT BETTER than on the indexes. Then you just use the inverse relationship (and long/long spread portfolio performance analysis) to trade the index. Or if you like TA just trade the bonds! (TA works on the indexes on longer term time frame).
You should also do lead/lag analysis using index spreads so that you can see through the noise on the indexes.
Ok, now that makes sense...and... indirectly confirms that TA on an index is unreliable. I disagree that even long-term, TA on an index is reliable. On long term... fundamentals & the PE relationship to GDP gives better long term predictions, so why fart around with TA at all on indices?
I have noticed that even respected and highly experienced TA analysts get it very wrong on the Index.
Dear "Rbrowny",
As mentioned earlier:
Timothy Morge removed Shane Blankenship from Market Geometry a few months ago. So Shane has started his own trading academy, same format as Morge's:
https://languageofmarkets.com/
Yes, this is the same Shane Blankenship that recently declared bankruptcy, and was Morge's protege, and business partner for like 20 years:
https://www.open-public-records.com/court/nevada-14952360.htm
Shane also has plenty of free material, and offers Mentoring for just $15,000 Dollars.
Please always do your due diligence:
https://www.elitetrader.com/et/threads/tim-morge-and-the-well-chosen-example.305061/page-23
It's apparent that "Professor" (he NO longer refers to himself as "Dr.") Timothy Morge, needed Shane's $179 Monthly Fees for three Classes per week. Mr. Tim Morge, after removing Shane Blankenship, is charging the same just for himself, and only teaching twice a week. He is also claiming that his Mentoring is completely FULL, but he will gladly accept your $3,000 Deposit in Advance, for a future spot reservation (he even claims a "waiting list"!!!). It appears that "someone" needs a major cash inflow, and very, very fast...
Truly amazing what a full, and honest exposure can do!
Both are beneficial in a long run if you think about it. Having a mentor guides you to minimize the risks and errors that you faced while trading, but without having a mentor helps you to realize your risks and errors and grow from them. So in the end, it is just a double-edged sword but ending positive.