Why does TA not work (for you)?

Quote from cornixforex:

Yes, I am MA in psychology and Ph. D. in social

Yes I am aware of Brett's works, thanks for the link.

But no, I don't counsel traders for money, counsel people with more typical spectrum of problems and more as a social work and to stay in good professional shape than as main source of income. Day trading makes quite a lot more honestly and is much more fun. :)


I trade by TA patterns, which in the course of the actual market observation made me confident to put the risk on those patterns, because they simply make money in the long run (being close to random in short samples, while it adds up very nicely in larger samples).

So nonsense or not... should we care as long as it just works? :)
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Yeah, Brett's a great guy. Know he use to be a TA true believer also untill he really analyzed it? Keep an open mind, before you lose all your money, you may "get it" also.

Yeah, if you REALLY think it works, then cool, go for it. Just like kreskin and other psychics. Be sure not to slip into the gamblers fallacy, however! http://www.skepdic.com/gamblers.html

Once again, if you flip a coin 10 times and get heads 10 times, are you in a heads trend?

How many moves or series of moves in one direction increase the odds of the next move or series being in the same/different direction?
 
Quote from marketsurfer:

I understand from your name/site that you are a dealer based forex trader? Likely use MT4 platform? Just guessing.

You also appear to be a psychologist/psychiatrist? I have a good friend who is also a psychologist--- maybe he can make sense to you why Fixed system
objective TA simply makes no sense

http://www.brettsteenbarger.com/Stationarity.doc

Surf

Ps--As an aside, maybe you can learn from dr Brett how to gain some traction for your business.

Pss. Are you familiar with the forex contest that you won by losing? Wonder why losers started winning hence lost the contest? Therein lays your answer.
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non-stationarity as it applies to trading is much much much more complex than simply "ever-changing cycles" as Dr. Steenbarger suggests, or volatility for that matter
 
Quote from marketsurfer:

Yeah, Brett's a great guy. Know he use to be a TA true believer also untill he really analyzed it?
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Did you read that paper you posted? He describes how he uses objective TA to trade. No mention of intuition or "price drivers", it's all objective mathematical analysis of past price.

Analyzing the market for trades should begin with tests for stationarity. In my new swing trading system, I begin my analysis by identifying the longest swing period in which the markets are exhibiting a stationary series of price changes. (There may be more than one such stationary swing period, permitting diversification of trading by time frame, and—of course—there may be stationarity for certain instruments and not others, permitting diversification by trading vehicles.) My procedure for assessing stationarity is to divide the time series into halves and statistically test to see if the means and standard deviations for the halves are equivalent. For readers interested in the math involved, Sherry’s book outlines a practical procedure for testing stationarity. The math is simple; I employ a quick-and-dirty t-test to the data and conduct the test entirely within Excel. What takes time is the repetitive testing of various lookback periods to find the proper window of stationarity.

Once I have that window, I then analyze the market qualitatively. I look at my indicators and observe how they have behaved during the stationary lookback period. The indicators that have consistently traced swing highs and lows over that period are the ones I will use to plan my next trade. I test signals yielded by the indicators (individually and in concert) over the lookback period to examine their entries, exits, and drawdowns. When I have a cadre of indicators that have performed well over the lookback period, I rely on them for my next trade.
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Quote from HurricaneUS:

non-stationarity as it applies to trading is much much much more complex than simply "ever-changing cycles" as Dr. Steenbarger suggessts, or volatility for that matter
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He certainly simplified it for the audience.

Surf
 
Quote from euclid:

Did you read that paper you posted? He describes how he uses objective TA to trade. No mention of intuition or "price drivers", it's all objective mathematical analysis of past price.
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Its not the same system over and over, it changes constantly with the market. Hence, my adversion to fixed objective TA.

Some traders on this thread even go as far to assert their system will work across all markets and has worked for decades. Ridiculous!
 
Quote from marketsurfer:

Yeah, Brett's a great guy. Know he use to be a TA true believer also untill he really analyzed it? Keep an open mind, before you lose all your money, you may "get it" also.

Yeah, if you REALLY think it works, then cool, go for it. Just like kreskin and other psychics. Be sure not to slip into the gamblers fallacy, however! http://www.skepdic.com/gamblers.html

Once again, if you flip a coin 10 times and get heads 10 times, are you in a heads trend?

How many moves or series of moves in one direction increase the odds of the next move or series being in the same/different direction?
More...

Hehe... You reminded about this great example taken from Taleb's "Black Swan":

There are two people:

Dr John, who is regarded as a man of science and logical thinking.
Fat Tony, who is regarded as a man who lives by his wits.

A third party asks them, "assume a fair coin is flipped 99 times, and each time it comes up heads. What are the odds that the 100th flip would also come up heads?"

Dr John says that the odds are not affected by the previous outcomes so the odds must still be 50:50.
Fat Tony says that the odds of the coin coming up heads 99 times in a row are so low (less than 1 in 6.33 × 1029) that the initial assumption that the coin had a 50:50 chance of coming up heads is most likely incorrect.

There's a hint in this example, in the context of TA too... But I will probably refrain from further discussion until the time comes... :p

Have a good day!
 
Quote from cornixforex:

Hehe... You reminded about this great example taken from Taleb's "Black Swan":

There are two people:

Dr John, who is regarded as a man of science and logical thinking.
Fat Tony, who is regarded as a man who lives by his wits.

A third party asks them, "assume a fair coin is flipped 99 times, and each time it comes up heads. What are the odds that the 100th flip would also come up heads?"

Dr John says that the odds are not affected by the previous outcomes so the odds must still be 50:50.
Fat Tony says that the odds of the coin coming up heads 99 times in a row are so low (less than 1 in 6.33 × 1029) that the initial assumption that the coin had a 50:50 chance of coming up heads is most likely incorrect.

There's a hint in this example, in the context of TA too... But I will probably refrain from further discussion until the time comes... :p

Have a good day!
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Great story, thanks!
 
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