Why Can't I Trade with the Trend

Quote from Cutten:

For a perfectly efficient market, it does require perfect competition. The efficiency is relative to the level of competition in the market in question.

E.g. ""An 'efficient' market is defined as a market where there are large numbers of rational, profit-maximizers actively competing, with each trying to predict future market values of individual securities, and where important current information is almost freely available to all participants. In an efficient market, competition among the many intelligent participants leads to a situation where, at any point in time, actual prices of individual securities already reflect the effects of information based both on events that have already occurred and on events which, as of now, the market expects to take place in the future." - Eugene Fama

It is competition from rational profit-maximisers with cheap access to market sensitive information that creates efficiency. Therefore any barriers to that process will degrade efficiency. For example - irrational or non-profit-maximising behaviour, expensive or hard to find information, limitations (e.g. low capital) on the ability of profit-maximisers to trade on superior information, small numbers of competitors, and so on.
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My claim for the theory of efficiency is that it applies with reasonable accuracy. Perfection is not required in the present discussion.
 
Quote from ProfLogic:

..Of course I'm a delusional fool ...
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"Due to problems with "Theft of Information" and harassment this Website is CLOSED..." now I understand, thnx for the explanation.


ps. lets do some logic here, I don't know any current sub. and I am not an "educator" so does the site close or open to me.
 
Quote from nkhoi:

"Due to problems with "Theft of Information" and harassment this Website is CLOSED..." now I understand, thnx for the explanation.
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Since you seem to be unable to post the entire sentence . . . twice, I will do it for you.

"Due to problems with "Theft of Information" and harassment this Website is CLOSED except for current Subscribers. The only new Subscribers given access will be on a referral basis from a current Subscriber or a verified college or graduate school educator."

boo bye
 
Quote from Grob109:

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All money making occurs in a partnership the trader makes with the market. Neither can do the others jobs or tasks. All money is made by the principle of the time rate of change of price over time.

So WHEN you annotate as you monitor, is important.

The five minute display of whatever the chart is showing (qqqq)served to illustrate making money.

Trends define where price cannot go and where price is contained. Since they overlap each other, you are never in doubt about where price can make you money. You also know that you can make money all of the time from this one factor.

Naturally, from about fifth grade onward it is possible to, at all times, define where price is contained. Knowing that a trend ends within its container is another simple beautiful thought. It allows you to make more money and make it sooner.

The attachment has trend lines for making money as you monitor. There are 26 segments for the 4 1/2 hours. they all are drawn ASAP and occasionally extended. The volume dV/dt is shown as positive and negative segments; there are 21 of these.

As a skill test, print the chart (with black showing) and number the segments for price and the segments for volume.

Monitoring money making involves two calculus related items dP/dt which is ever positive for your trades (you trade long or short to take advantage of all price movements all the time) and dV/dt which is THE leading indicator of price.

Now you see a plus dV/dt means tren will continue. A negative dV/dt means the trend will change. "continue" and "change" are not opposites. Making money does not deal in opposites. You can see that almost all elite trader posts are based upon opposites. The market does a job. It tells you about change and continuation.

Traders think about opposites mistakenly. Here is a common pair of them that are in a lot of posts: buy and sell. What if a person was interested in making money and he partnered with the market to make money. When he becomes a real pro (this is an amateur term for me), he deals in two factors that are not opposites: hold and reverse. When dV/dt is positive the market is saying be ready to keep holding; when dV/dt is negative the market is saying be ready to reverse. This activity is simple. The second derivative of Volume relative to price goes to zero between the times The first derivative changes sign.

Write out the definition of sidelining from the above. Hint: you sideline when the activity of the market exceeds your skills and when dP/dt = 0.

So in this chart you see other major data for making money. trends have widths and velocity (steepness). The container of price in which you trade has sides. The calculus of Volume is related to which side.... LOL..... Imagine whether more people use this side to trade than the other side. Imagine as you read this you have never in your life even thought this far into making money.

So make a list of everyone who talks about trend lines and their slopes only. make a list of those who use twosides to define a trend. Why did DB never get to using the correct side to ______ or _______?

So the chart shows a typical "M" day. Do you see the trend channel widens for each of the two am trends? On positive dV/dt in both cases.

Do you see the trend container ends as P comes of the left line as dV/dt goes negative after d2V/dt2 zeroed in between. All of this is where the overlap of the trends is initiated.

So do you look closely enough to see when ASAP occurs to draw a segment for the trend container of the prices to come, all within the trend.

Lets say you do not know any fifth graders who can explain this to you. At least you can go out on the wrong side of the trend channel later.

For those who have it down, see how smooth the low volume slalom begins when, as usual the "S" of the day gives you the repeated failure (INSUFFICIENT Volume) to expand the L of the H/L of the day. Did you see that H hit for you. No you didn't; there wasn't anylow volume to prove in the H.

Borrow a yellow crayola from a child to underline whats new to you. Mark in a color of your choosing, what you need to change in your mind. Say each one at least five times to make anything even start to stick.
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This innovation could change trading as we know it.
 
Quote from NickelScalper:

Okay, here's the new and improved version:

The real issue is whether or not future price can be determined on the basis of past price action.
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Price cannot be determined accurately enough to trade.
Time of a price reversal can be determined accurately enough to trade.
 
Quote from nzbryant:




Jrkob

Was using RAND() in Excel. THanks for the link. On a few thousand simulations the average end point of the random number chain (20 bars) was zero, so I expect it is working.
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The fact that the average end point of the random number chain is zero is absolutely not sufficient to claim that Excel random numbers are truely random. Again, they are NOT. It is absolutely possible for a semi-random number chain to give you constantly an average end point of zero. And this is exactly what is happening in your case.

Sorry, I don't mean to challenge you for the sake of it, I have better things to do. But I can just tell you one thing: you are making wrong assumptions.
 
Equalizer. A lot of ass-muptions buried in that derivation, such as a constant drift and a constand diffusion. Neither of which allow for the fact that a tewn tick change often is followed by a four tick reversal. Help an old man understand your point, please? Is it ridiculous to talk of derivatives of P and V, or not?
 
Quote from John Merchant:

Equalizer. A lot of ass-muptions buried in that derivation, such as a constant drift and a constand diffusion. Neither of which allow for the fact that a tewn tick change often is followed by a four tick reversal. Help an old man understand your point, please? Is it ridiculous to talk of derivatives of P and V, or not?
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I believe this is what is termed cognitive dissonance.

John, did you or did you not state that the concept of differentiation of a random variable left you "breathless" as you put it in Grob's post?

The link was supposed to provide some clarity to the mathematically minded who might have been confused about some of the statements. Otherwise, I don't give a flying 4X what you or anyone else thinks about the properties of price/volume trajectories.

Then again, if Grob uses the slope of P and V (maybe we should call it the ideal gas equation :D ) and makes money from it, who are you or I to argue with him.
 
Quote from 5yrtrader:

Well then your problem is you and you have just supplied the answer. If your losing money thinking the market is oversold, then your wrong. The market is never "oversold," so sell lows buy highs and quit bitching.
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completely wrong!

This is what the big money watch for. They watch for people who think that the market is not over sold/bought and that is when they reverse with a vengeance.

They watch for the herds to show up (spikes) and that is when they catch them in a bull/ bear trap.

They know that these herds will not easily abort their position easily due to their complete and utter conviction in the trend.

I only go countertrend for two reasons.

1- big money does not like spikes and accelerated and big price moves , the moment they see herds jumping in (spikes) they dump half of their position on the opposite direction to push them out.

2- what you call a pullback on a 30-60 min. chart I call a trend reversal on a 5 min.

I watch for the big money when they push the small fish out and jump with them.

Now there technicals that I use to help me spot a reversal, if you master them you would fare well in more times than none.

If you are wrong, get out at a pre-set stop loss. If you are right get out at a pre set profit taking (usually 2.5 times bigger than stop loss)

I really belive that there are two types of traders, a trend trader and a reverse trader...You seldomly have a trader who could master both.
 
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