Why does TA not work (for you)?

[marketsurfer]

Quote from logic_man:

Why do I insist on this? Because for me TA "can be" (not that everyone would actually implement it this way, but I implement it this way) a form of algorithmic trading. Algorithms are, by definition, objective and programmable.

What I don't understand is how you can, on the one hand, defend and praise HFT, which is also (primarily?) algorithmic trading and deride TA, which definitely has overlaps with algorithmic trading, even if not everyone's variation of TA is algorithmic.

Then, there is the contradiction of you saying that "fixed systems" are obsolete, yet HFT, which you seem to like, is almost all "fixed systems", since you don't have time to be deciding among various options when your execution times are that fast. There is probably a good deal of "branching logic" in HFT algorithms, but even with branching, they are "fixed systems".

I'll accept my role here as an educator -- HFT is not a trading method but rather encompasses multiple strategies-- primarily market making and latency arbitrage. It is constantly evolving and in no way "fixed". One HFT strategy may work for a week then it's edge is gone and another strategy is implemented. HFT has nothing to do with TA for the most part.

 

[marketsurfer]

Quote from logic_man:

So, if I am interpreting your chart correctly, there are more multi-step movements in the same direction in actual prices than would be predicted by random prices? If prices were truly random, we would see more sequences of 1 move in one direction followed by 1 move in the opposite direction, correct?

No, there are runs and series in random generated stock charts just like in real price charts.

 

[marketsurfer]

Quote from wrbtrader:



That's why there are NO consistently profitable traders using TA and nothing else because they are obviously relying on other tools with their TA.

How many market return beating non prop traders have you met? Not counting unverified claims

 

[cornix]

Quote from Redneck:

HTFs can be beat

TA - I leave it to you to decide

(not meaning you CF)

RN

Guess it depends on what's meant by "TA". If it's TA in the sense of wrbtrader, then hardly one can beat a human trading nearly every day and staying in sync with market evolution. That's the beauty of creative TA approach, you adjust to the game depending on conditions, algos can't change that fast, because they first need to be reprogrammed by humans.

 

[cornix]

Quote from marketsurfer:

How many market return beating non prop traders have you met? Not counting unverified claims

I would never speak of unverified claims in the presence of wrbtrader, because it really sounds funny.

 

[R. Raskolnikov]

I personally know the head of a HFT desk at a major firm in NYC and we had dinner several months ago and we were talking about HFT and he TOLD me that they use TA as a component of their algo's strat.

Quote from marketsurfer:

One HFT strategy may work for a week then it's edge is gone and another strategy is implemented. HFT has nothing to do with TA for the most part.

 

[cornix]

Quote from R. Raskolnikov:

I personally know the head of a HFT desk at a major firm in NYC and we had dinner several months ago and we were talking about HFT and he TOLD me that they use TA as a component of their algo's strat.

When I watch Euro PA and see how amazingly often it reacts at certain TA/PA levels, it makes me wonder if those algos which are lately very active in FX also use... (such a blasphemy!) trendlines and S/R...

 

[marketsurfer]

Quote from R. Raskolnikov:

I personally know the head of a HFT desk at a major firm in NYC and we had dinner several months ago and we were talking about HFT and he TOLD me that they use TA as a component of their algo's strat.

That's news to me. Does this firm lose a lot? People try all kinds of crazy sh@t trying to find an edge nowadays. Some fims have Gann masters and astrologers on staff.

 

[R. Raskolnikov]

I don't know the desk's performance metrics but he's been the head of the desk for at least several years now and he works for a firm that everyone here knows. I would imagine if they weren't doing well, he'd be gone by now.

Quote from marketsurfer:

That's news to me. Does this firm lose a lot?

 

[marketsurfer]

Quote from R. Raskolnikov:

I don't know the desk's performance metrics but he's been the head of the desk for at least several years now and he works for a firm that everyone here knows. I would imagine if they weren't doing well, he'd be gone by now.

Next time you see him, ask him about the results with the TA strategy. It won't be a pretty picture--- if he's telling truth. Remember, some of these firms run 100's if not 1000's of strategies--- could there be a TA component to one of them-- SURE. That's why my original comment said "FOR THE MOST PART". There are TA true believers in all levels of the market-- doesn't mean TA works.

Just like multi PhD particle physicists who believe in Magick--- there are a few, but it doesn't make Magick credible.

surf