Why does TA not work (for you)?

Quote from contra:

Got you... I think the performance may be great but when you bring in what they have to pay to keep there systems up to par and how much it does cost to run them... you know what im saying.

However, as a big fund, I think they make there money back on how much they can now charge clients for there "performance"

see here:



I still believe we as human traders can find inefficiencies and have good feel for markets and make money.

but using straight up TA... probably wont get anyone far.
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Right, those are huge capital outlays for systems and those costs need to be passed on to investors. No question about that.

I will be the first to say I have a terrible "feel" for markets. I rely on my rules to keep me in or out of trades. Those rules are built around a logical principle which I learned from someone who was a successful trader and then I adapted in a new way. The reason I took up this principle as the basis for my trading was because it was not something I had ever seen anyone else use and I saw that the guy who developed it was already making money. All I had to do was program a bunch of Excel spreadsheets and I was up and running. A couple of years of refining it and it shows no signs of deteriorating. One of the ways I know it works is that almost every time I try to break one of the rules, I end up making less money than I would have if I had just kept to them. Maybe 1 out of every 5 times I break a rule, I make more (or lose less) than I would have otherwise. Again, that's related to my terrible "feel" for the market.

Anyway, back to the issue of HFT, I think that sometimes the best breakthroughs in a field are conceptual, not simply a matter of refining or speeding up the old ways. Throwing a supercomputer at a problem won't necessarily solve it if the supercomputer isn't programmed with the correct concepts. It will just get you to the wrong answer faster.
 
Quote from BSAM:

Exsqueeze me, brother Black but the sales are reflected on the chart.
The sales are real; that's why the chart is real.

T&S is PA.
PA is TA.

And, the sky is blue.

And, if A=B and B=C, then A=C.

It's not that hard to understand.
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Sorry bud, but nope.

T&S will show you at what price and time, what volume was traded. The clues in the name :D

A chart aggregates that data so you miss the granularity.

The devil is in the detail they say.

Your 5m chart may show average volume between 56 to 62which made the last high. It all looks very average to you and no warrant of close attention.

The T&S may show that only 2 lots printed at 62, followed by 1200 at 61, then straight away 1700 at 60. Those volumes may not be average. They tell you something.

I dont care where abouts in some silly channel that occurs - because no good trader watches that kind of trash. Youd better not either.
 
Quote from R. Raskolnikov:

Really?

http://www.amazon.com/The-Traders-Guide-Technical-Analysis/dp/0071359796

"The Day Trader's Guide to Technical Analysis: How to Use Chart Patterns, Level II and Time of Sales to Profit in Electronic Markets "

Just used google, it took 4 seconds
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Awww man I'm busted!!!


:D

Ok to be honest, I dont read a whole lot of trading books. I bought a few in the early days (Pring etc), realised they were good as door stops only and never looked at another one - apart from Dalton which I actually thought was quite good - and yes I guess MP is a form of TA. I just dont use it much
 
Quote from TheBlackHand:

Sorry bud, but nope.

T&S will show you at what price and time, what volume was traded. The clues in the name :D

A chart aggregates that data so you miss the granularity.

The devil is in the detail they say.

Your 5m chart may show average volume between 56 to 62which made the last high. It all looks very average to you and no warrant of close attention.

The T&S may show that only 2 lots printed at 62, followed by 1200 at 61, then straight away 1700 at 60. Those volumes may not be average. They tell you something.

I dont care where abouts in some silly channel that occurs - because no good trader watches that kind of trash. Youd better not either.
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I just need to know what level my instrument trades at.
Really difficult for you to grasp, huh?
 
Quote from BSAM:

Brother Black, do you trade real money?
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Whats real money?

I hope its real. My FCM never complained. Its just numbers to me. I spread those numbers against other numbers. Sometimes I'm right, sometimes Im wrong.


:confused:
 
Quote from BSAM:

I just need to know what level my instrument trades at.
Really difficult for you to grasp, huh?
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Not at all Brother BSAM. I understand flipping coins, red & black on the wheel etc. I just dont like the odds.

:)
 
Quote from TheBlackHand:

Whats real money?

I hope its real. My FCM never complained. Its just numbers to me. I spread those numbers against other numbers. Sometimes I'm right, sometimes Im wrong.


:confused:
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So what is the answer?

Do you trade real money?
 
Yes sir, busted indeed :D

But seriously, do you see what you did there? You definitively spoke about something that you just admitted to not really knowing all that well. This is my whole issue with definitive speakers like marketsurfer. Proclaiming something is crap that they haven't fully tested or experienced (which is not a bad thing in the case of TA since it is so vast that I doubt anyone could fully test or experience it).

But this is precisely why it's wrong to proclaim an entire area of study to be worthless when they've only scratched the surface of it. I would never presume to call something worthless that I didn't really know fully and if I did, I would know, deep down, that I was being a hypocrite.

I think it would be best for everyone to just admit that there are many ways to make money in the mkts and not everyone has to use the same approaches. Do many people who use TA fail at trading? I'm sure the answer is yes, but I'm sure the answer is yes for trading using ANY method. The odds of success are never great if you play by the rules (ie no insider trading)


Quote from TheBlackHand:

Awww man I'm busted!!!


:D

Ok to be honest, I dont read a whole lot of trading books. I bought a few in the early days (Pring etc), realised they were good as door stops only and never looked at another one - apart from Dalton which I actually thought was quite good - and yes I guess MP is a form of TA. I just dont use it much
More...
 
Quote from TheBlackHand:

Not at all Brother BSAM. I understand flipping coins, red & black on the wheel etc. I just dont like the odds.

:)
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I do like the odds.
That's why you should be doing way more listening.
 
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