Why do you believe in such things as wedges, triangles and inverted whatevers...

Quote from retaildaytrader:

There are a few people out there, like Bulkowski, that have attempted to put a probability behind each chart formation. The probability that he assigns usually goes something like 55% or 60%...basically, a little better then coin flip odds.
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If you cannot make money with a 55% to 60% edge then you're either a lousy investor or just a plain idiot.
 
Well, to be fair, you do then need money management for example risk vs reward per % risked per trade, and then psychology strength for example to not feel fear and greed yourself.

Quote from Corelio:

If you cannot make money with a 55% to 60% edge then you're either a lousy investor or just a plain idiot.
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Quote from Corelio:

If you cannot make money with a 55% to 60% edge then you're either a lousy investor or just a plain idiot.
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or volatility works against your R:R. First of all, the edge is not the win rate but the expectancy of your trades, which is a function of the win rate w

e(w) = w x avg. win - (1-w) avg. loss

as you can see - I hope - 60% is not enough if your avg. win is not large enough. Your average win depends on how large is volatility with respect to your target and stop size (R:R).

In some markets one needs more than 70% win rate to get an edge (positive expectancy) because of the way prices move.

If you are not familiar with the expectancy equation and terms, it is derived and explained in this paper.
 
Quote from intradaybill:

or volatility works against your R:R. First of all, the edge is not the win rate but the expectancy of your trades, which is a function of the win rate w

e(w) = w x avg. win - (1-w) avg. loss

as you can see - I hope - 60% is not enough if your avg. win is not large enough. Your average win depends on how large is volatility with respect to your target and stop size (R:R).

In some markets one needs more than 70% win rate to get an edge (positive expectancy) because of the way prices move.

If you are not familiar with the expectancy equation and terms, it is derived and explained in this paper.
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Oh boy! That was the gist of my comment folks!
A little money management, risk control and betting size can go a long way.

You can make money with a 35% win rate. It all comes down to a well planned system.
 
Quote from jem:

I am up over 40 percent on a stock from a few weeks ago.

It came up on a screen... it set up on an intraday pattern I like which helped define the risk. I took off half when it hit my target based off the pattern and it has consolidated or run in my direction ever since.

It also happened to be in a hot sector.

If you you do not think there is an edge in t/a you are nuts.
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If I put all my money on Black at a Roulette table and then won...would that be because of my strategy or just dumb luck? So you got a big win because of random luck...that doesnt mean that it was as a result of your strategy or technical analysis. All that means is you were able to get a lucky win from a game where the odds are stacked against you. I have won big a few times at slot machines. It was pure luck and not because of some sort of technical strategy.

The best "traders" on Elitetrader are not good "traders"...they are good "gamblers". Of course, there are a few poker pros out there that make their living at the tables just like there are trading pros who make their living from this. No successful trader I have read about uses technical analysis....
 
How do you evaluate a fair coin?

Let say you get 7 wins out of 10. Will that make you think you have an advantage and the coin is not fair?

What if you get 15 out of 20 etc...

How can you calculate with a 95% confidence level that the coin is not fair and you have an advantage?

How many trades do you need to make within a month or year to have 95% confidence that your month to month or year to year income will be within a given range?

Where does luck stop and edge begins?
 
Quote from Mr. Miyagi:

Here are the realtime trades I posted today numnutz, you will see I have done quite well, all profitable , and all based on technical analysis.

http://www.elitetrader.com/vb/showthread.php?s=&threadid=64965&perpage=6&pagenumber=15445
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Those trades were amazing and I learned a lot from your analysis. When you said 'lighten load' was that a reference to the 'bathroom break', a well known candlestick formation?

Would you consider trading a 20 million dollar account, I don't want to miss another day of your brilliant entries.
 
Quote from stock777:

Those trades were amazing and I learned a lot from your analysis. When you said 'lighten load' was that a reference to the 'bathroom break', a well known candlestick formation?

Would you consider trading a 20 million dollar account, I don't want to miss another day of your brilliant entries.
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Awww shucks, thanks 777, how old are you?
 
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