Now that is "obvious"
Why Is The Obvious Not So Obvious?
- Thread starter nysestocks
- Start date
The industry works hard / spends billions - to convince us - complicated equates to more certainty.., more / bigger profits
Just not so
You of course can make things as complicated as you wish - but why (rhetorical Sir)
RN
the obvious is .... you must know what is low and what is high
you can't BL without knowing what is low and you can't SL without knowing what is high
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you can't BL without knowing what is low and you can't SL without knowing what is high
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Ehh can't say I agree. Knowledge in trading, just like in anything else, is power.
Sure, maybe you can find an edge based on charts and repeat that over and over until you become one of the big players (although not very likely). However, what you do when your size begins working against you? Just become another sucker.
If simple was really easy, a lot more of us would be making money. Why do you think the big players focus on more than just TA? Why do they focus on the macro conditions? The market expectations vs outcomes? Etc. Because they know its key to building an edge based on their restraints.
How about when a different market condition completely wiped out your edge? TA has become extremely hard as of late and the returns it generates are by no means impressive, especially for the size most retail traders trade.
Why not learn different types of analysis and combine them so you can build an edge around any market condition? Why not combine technical analysis and fundamental analysis for higher trade probabilities? Why not throw in global macro analysis, or order flow analysis, or behavior finance concepts? Why not learn about stop hunting, market squeezes, key drivers of the market, market microstructure, etc.? What about learning coding and quantitative analysis and building strategies you don't need to baby sit? Why not?
Like I said, knowledge is power. The more you learn, the more you can do. The more you learn, the more edges you can build, the more inefficiencies you can exploit. Just as in life, you should never stop learning. Of course, that's just my personal opinion. To each their own..
In the normal would - I would tend to agree
In the trading world - uncertainty rules all - and no amount of anything will ever nullify that fact
RN
Hi JS,
I know nothing. This said, I think someone has been accumulating Short orders on Friday and in previous days. the down/up spike at the day open and the subsequent fixed range close to the high of the day is a good indication. So I would lean toward price going down in the coming days even if I wouldn't be surprised to see an up spike at the open on Monday. but Hey, I could be completely wrong and so I would need to be prepared for this possibility...
FX, while it may be useful to understand how a market operates and even more useful to have screentime with the stock you trade, I prefer to KISS (Keep It Simple Stupid!) and trade what I see. at the end of the day anything can happen at any time, but, at any given time, some things are more likely to happen than others I try to trade that and to provision for being wrong so that I lose with style and I gain with a roar...
In the normal would - I would tend to agree
In the trading world - uncertainty rules all - and no amount of anything will ever nullify that fact
RN
That's true. The market can be very uncertain and that's why at the top of the food chain they tend to chat with each other about client info. It's an informational advantage and one that had proved to be very lucrative until they started to get caught. Of course, some of the big players stay in touch to talk about general market themes and opportunities and there is nothing illegal about this. They perform their own analysis, but a second opinion from a top player never hurts.
We retailers will never get access to these sorts of market contacts and must do with what we have. Unfortunately, uncertainty is a big part of markets especially in these recent conditions. It's very prevalent in FX where uncertainty about the next move is leading to a lack of trends and many large financial funds are staying away except on the highest probability moves. This means commercial corporation order flow has started playing a bigger role in price movements and the market is exhibiting some very odd and random behavior, not to mention the choppy and unpredictable moves. Of course, as we get closer to rate liftoff this should change.
I still don't think uncertainty should negate learning other types of analysis. Actually, combining different types of analysis under different set of conditions and order flow generating scenarios could lead to much higher probabilities than just focusing solely on one. This is never a bad thing. Even if you learn something you can't use, at least you learned you can't use it and that itself can be beneficial. For example, say you tried the no stop loss method and blew out. You decided you can't use it and learned that the hard way, and this knowledge should help your trading. Each different type of analysis is a tool in your tool box. The more you have, the more you can do, but this doesn't mean you must use it. Use it only for the right job.
Of course, this is coming from someone who will eventually start a fund and needs to think along these lines. Everyone's end goals are different and if simplicity helps you reach yours, good for you! Two traders with completely different methods can still be (un)profitable, it's just the nature of markets.
In any case, good luck in your trading!!
Hi FX on "a lot of traders get killed because they buy when price is falling because "it has to go back," and it never turns back and vice versa for selling" I can only say been there done that...
this said, any particular day the price will generally do one or more of the following things: move within a range (use the box), move to the next range (still the Box may come handy) do both.
I think the same reply I just posted to Red would apply to you.
Anything can happen, you're right. A good trader is nimble and trades what he see's, not what he believes. However, there's an edge to be found in being able to differ a breakout of resistance on the chart vs. resistance breaking because of stop hunting, or because of risk-off sentiment on China fears. Two different scenarios can cause price to do two very different things after the breakout.
Understanding what is currently driving markets can be key between losing or winning, taking dumb bets or smart ones. I look for higher probabilities over just solely taking every trade and just cutting losers riding winners. Of course, that works for me and requires in depth analysis of intermarket asset flows and current sentiment drivers. But if you're making money, who am I to say what works or doesn't..
And don't get me wrong, simplicity can easily work. Just not for the super high probability trades I'm looking for. And I'll be the first to say that both simplicity and complexity can and do work. Many of us retailers find success with simplicity. But the big players thrive on the complexity. There is nothing wrong with either way, you choose how you want to trade based on your own goals, time, mindset, and trading personality.
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