Why do patterns fail?-makes no sense

neo,

Rather than bemoan all the faliure patterns, take advantage of them. Place buy/sell limits 4-5% beyond resistance and catch them. Even if it isn't a failed pattern, your entry point allows for a low loss escape.

Good Luck and Big Profits,:cool:
 
Patterns are only so good as who is making them happen.
If you see a pattern in eminis or a nasdaq stock and it fails
it's because by virtue it should. Many small operators cause the
pattern to happen and smart money will fade it. Your 1-5 lots on
emini are nothing compared to what the pros play with and they
can manipulate the markets. They have superior fundamental intelligence (in terms of commercial activity) and lots of cash.
patterns are to be ignored in intraday minis, it should only
matter for daily charts coupled with volume. Volume is the key
to what smart money is doing. Be contrarian if you wish to
survive. Everyone watches charts and patterns in the game of
commodities and 95% lose. Ever wonder why ?
 
Patterns cant fail, because they cant succeed. Patterns only reflect history, they dont project the future.

One mans failure is anothers success, ie if you took the opposite side.

Try not to externalize your experience in the market.

If you consistently lose, keep doing what your doing, but just do the exact opposite, and you will be a millionare in short order.

Its all where you park your mindset and how you discipline yourself.

FWIW
SW
oneway
 
andrasnm, nice to have you back.
I understand you try not to trade short term anymore, right ?
what kind of trading do you do now ?
I am now also looking at all the circus out there, the big pyramid scheme and I am now looking at longer term trading. Anything using shorter than a daily bar I try to ignore.
It actually worked much better for me since I do that. Everything is much easier indeed.
And back to patterns, well I only trust support/resistance and trendlines. They tell you a lot when they work and even more when they don't.

tntneo
 
patterns fail because they don't exist.. they are a creative illusion in the mind of the trader who desires a repetition of order in chaos.. just as the brush strokes of a master painter are wholly his own, the interpretation and recognition of chart patterns belong to the trader.. to understand their meaning, one must first understand the artist..

-qwik
 
One trader's pattern failure is another's pattern confirmation. It depends on your expectation. A stock breaking out on the 5 minute charts might do so at long term resistance and fail abruptlyafter the breakout, offering success to short players on the longer time frame.

When patterns fail more frequently there is a different underlying dynamic behind them to discern.

Some classic long patterns like ascending triangles were failing with an incredible consistency in the fall of 2000. I recall 5 minute setups all the time with this pattern rising up to the breakout point and plummeting-they were really succeeding, as short triggers.
 
<b>patterns fail because they don't exist.. they are a creative illusion in the mind of the trader who desires a repetition of order in chaos.. just as the brush strokes of a master painter are wholly his own, the interpretation and recognition of chart patterns belong to the trader.. to understand their meaning, one must first understand the artist..

-qwik</b>

such true words.....so often ignored...
 
Thanks,
For some time now I only do fund switching using leveraged funds.
Profundsm and potomac. I can go short, pick midcap sectors etc.
Cheers
Andras
 
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