Seems like we have these threads every few months. Like @oraclewizard77 said, TA is a set of tools -- and that set is pretty broad. Applying them in any type of useful manner is more art than science (and difficult to do) and my performance results (good or bad) are the result of how well I utilize those tools and how well I manage myself -- ultimately, my skills as a trader. One can be very good on the analysis side but have issues on the execution side so performance results aren't necessarily indicative of the value of a particular technical approach. That being said, I don't think much of most well-known technical approaches and technical analysts -- I don't think they offer much value. Still, my own approach is completely technical in nature, if you include sentiment and cycles as technical pieces, but the value to me is how everything is put together, including across multiple time frames, but you won't find me worshiping at the altar of Edwards & Magee.
Why do traders talk about TA as if it is physics ?
- Thread starter traderwald
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I understand what you mean. This thread was started as more of a comment about how traders describe TA as though it is like physics in how physics obeys certain equations. How some traders as they get deeper into explanation tend to get immersed as describing TA like physics.
I think TA gives plenty of information of what is now. Where the money is etc. It is much more broad subject than most retail traders understand which is why they probably underestimate it.
However, I doubt it can tell where the price is going. It can only tell where the market is. Then based on this and other factors - it is up to the trader to decide what to do.
Thank you
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Thanks for your response. I would just say that a skilled individual can use the tools of TA to determine an edge as to the market moving in a certain direction.
I've never seen any trader describe TA as though it is like physics but I have seen traders describe it as though it obeys mathematics or something scientific.
Also, I've seen traders use the words predict, probabilities, statistics and such. Remember, most traders that are using TA aren't writing down equations or trying to solve a finance equation.
Instead, the computer does the work such as codes and programs regardless if they're plotting price moving averages, algorithms or such. I think it comes from investment terms or fundamental analysis in which someone tries to find values in a company to "predict" the best investments.
My point, there are traders deep into TA just like there are traders deep into FA...they view it as an academic pursuit but when they go too far down that rabbit hole...these traders forget that price action or the markets will often move Up, Down, Sideways based upon the emotions of those in the markets.
wrbtrader
Yes! Great point. For me, personally, I pretty much dismiss conventional TA and those who use it as not being very useful but it did help me understand different ways to interpret the markets but then I customized it, not in an academic pursuit, but in a manner to give me a better way to read the markets. At the end of the day, you want some way to give you an edge in reading the markets -- who cares if that is pure price action, market profile, indicators, or whatever.
I think you're missing the fact that I understand TA and its theoretical applications quite well; part of my introduction to trading was a series of classes from a CMT. What I object to is the idiotic hyping of TA as the one-stop, trivially-simple, instant-riches solution to trading - which was the point of the very first post in this thread. If you've found a way to make it work for you - great, I have no argument with that (despite having a fairly strong conviction that it "works" the same way as "stone soup" does, for most. That is, if you know how to trade, TA won't do you much harm.)
What I don't appreciate is the plain unvarnished statement of "just use a major indicator, they work." That's a straight-up lie that has caused many new traders to lose money, or blow out their accounts. I have a strong objection to the retailing of that lie.
And this is pretty much the capstone to the whiny excuse of "I'm not going to show you how my TA works, iT's mY bIg SeCReT, waaaah!" that is always used by people who do the above hyping. Any real trader understands this; even if someone does understand your strategy, they won't be able to replicate it exactly because they're not you, and don't have your exact perception of price action and all the other factors that you apply to your trading.
Basic, solid advice that I've given to others many times myself. Nothing to do with TA, everything having to do with discipline and a rules-based approach.
Had to go look it up - it's been a while - but it was Scott Maragioglio. Pretty sharp guy, but most of the value that I got from his teaching was an intro to general trading and market perspective.
Interesting the repeating theme, on a traders forum. Also the number of "explanations" and "assertions". One good starting point on these types of questions about language is theory. Here: https://plato.stanford.edu/index.html type in language. You come up with a lot of more technical stuff, but a standard starting point is work about 100 years ago by Ludwig Wittgenstein, and the "private language" papers. In lay terms the super short "answer", is that it is the same reason Unicorns are described as horses with Narwhal horns. We are just using the language tools we have. Nothing really deeper than that.
I don't know him although I used to be pretty involved with the CMT Association. But I totally get where you're coming from.
That being said, Edwards & Magee showed me how to think about the market from a technical perspective but it's not going to give you much, if any, of an edge -- maybe it helps you reduce risk because you can recognize a downtrend.
That being said, Edwards & Magee showed me how to think about the market from a technical perspective but it's not going to give you much, if any, of an edge -- maybe it helps you reduce risk because you can recognize a downtrend.