The pun was directed at TA as a whole but wasted on those of us that instability isn't part of our analytical results.
Here is a great example of fuzzy thinking... That does not actually address the worth of TA... But the writer believes he has in fact made some kind of viable point. TA works... because result of "human psychology". Not true... TA result of high school math. Then he talks about how ** markets ** are the result of "human psycholgy". Then talks about history repeating itself... yada, yada. None of this supports in any way the validity of TA or proves anything at all... But it very much satisfies the writer. People who think like this are very common... And they believe in TA solely on the basis of roundabout baloney like the above. And it's like crack... once addicted, the person is lost forever. rm+
"Here is a great example of fuzzy thinking... That does not actually address the worth of TA... But the writer believes he has in fact made some kind of viable point." look, i know TA works (N=1) because i make consistent profit (and a living) by daytrading index futures. and i use TA. primarily market profile analysis with market internals (TICK, AD) etc. otoh, when i make INVESTMENTS, i use primarily fundamental analysis. because in the longer term, i find that buying stocks @ a discount to their value and buying them when they become overvalued works well. and it suits my contrarian nature. i find that usually TA and fundamentals compliment each other,. which is also nice "TA works... because result of "human psychology". Not true... TA result of high school math." TA is not the result of High school math. TA is the result of the fact that the market is NOT rational (in the short run) and that traders can exploit inefficiencies in the market, inbalances in the supply demand/curve, and the emotional cycles of fear, panic, euphoria, greed, etc. that are seen OVER and OVER and OVER again. i don't use "indicators" generally speaking - MACD, RSI, etc. but i do find that following price action, TICK, and key price levels (mostly from market profile) is very profitable. "Then he talks about how ** markets ** are the result of "human psycholgy". Then talks about history repeating itself... yada, yada." yes, markets are made up of PEOPLE have you ever been to the CBOT? ever seen a trading floor. prices are the result of the aggregate opinion of people buying and selling something. any two way auction process will suffer (or benefit depending on your point of view) from emotional extremes. "None of this supports in any way the validity of TA or proves anything at all... But it very much satisfies the writer." none of what u said "refutes" what i said. it's just contradiction... ie "you're wrong" "People who think like this are very common... And they believe in TA solely on the basis of roundabout baloney like the above." i majored in psychology and went to grad school for same, and i make a living trading index futures. so i don't believe it based on baloney. i believe on it based on results fwiw, results matter. not to academics such as the Chicago school who claimed efficient market theory for years/decades while the market proved them wrong. "And it's like crack... once addicted, the person is lost fore" it's like "making a living". as long as i continue to make a living using TA i will believe in it (intraday futures trades) as long as i continue to see my longterm investments prosper based on a combination of fundamentals and TA, i will believe in both. the advantage that a trader has is that he can choose NOT to trade. i protect my trading capital. when i see an opportunity, i pounce. this makes money. most traders lose. this has nothing to do with TA. most traders (at least in futures) HAVE to lose, because futures are zero sum and net gains + net losses = 0 (and that is not even counting commissions) you make your living your way. as long as TA provides me with money, i will use it fwiw, i think TA is just a tool. what seperates a good trader from a losing one imo is risk management and money management, much like a poker player cards, in poker are TRULY random (unlike stocks), yet certain players consistently win (in this zero sum game) . how? because it's not about the cards. it's about how you play them - how you manage risk, and your money - to take it from others. that is, again, part of psychology. in poker, you don't play your cards. you play the other players. in trading (vs. investing which is distinguish from trading), you play other traders. as long as you remember that, you are starting off on the right foot. there is no magic indicator. there is traders trying to outgame other traders.
typo above. should be "buying them @ a discount to their value and selling them when they become overvalued..."
I had not heard that term. I looked it up and I am learning more about it. Thanks. http://www.wagntrain.com/OC/#Operant I agree with that to the extent that we have a memory for "yesterday's" outcome. But I think you might be confusing terms. Even when I a not in a positon, while I might not be "trading," I am still executing my craft as a trader. For example, while I have a desire to trade as often as possible, I don't trade just to trade. I trade when I see inneficiencies due to market structural situations, or based on some statistical event that plainly tells me when to enter. So while trading is mostly boring to some because there is nothing to do most of the time (even that is debatable because many traders have core positions they come into the day with), it doesn't mean that you are still not executing of your craft when not in a positon. So while I am not in a trade, I am constantly tape reading and internalizing market movement in stocks that I follow. That way when a move happens, something tells me (usually the intution that I have built and my right brain instantly recognizes) to raise my level of alertness (meaning activate my left hemisphere for methodology rules for entry) and to pick an entry. In short, I think it is too simplistic an explanation. I think you may be referring to classical conditioning here. I have to think about it because no real answer comes to me immediately. Of course! But that is tautological. I am not sure I understand. What I was saying about the turtles is that you seem to imply that only market makers have an edge, and that "predictive" type sucessful traders are an illusion of the law of large numbers. I proposed that this is false in that one would then not expect any greater degree of success from educated traders like the turtles and the Bright traders, than traders sitting at home trading in their pajamas. nitro
"I don't trade just to trade. I trade when I see inneficiencies due to market structural situations, or based on some statistical event that plainly tells me when to enter" well put. that is very much how i trade index futures. i let the market come to me, at certain levels. there are certain plays that i backtested with over 200 trades to get their relative probability of winning, and to define how to set stops and limit exits. combine that with several hundred live trades in DIA before i ever traded YM (dia gives worse fills than YM, so if it works on DIA, it works on YM), and THEN moved to YM so, anybody who tells me TA doesn't work, can't explain to me how certain plays have a 78% chance of winning with a 10 pt stop and an 8 point target. it aint random when i had over 400 trials and it worked out to that %age. that is one of our greatest advantage as traders (vs. mutual funds/institutions). we can stand by until the proper opportunity presents itself, then pounce. with plays that are backtested. i play mostly by probabilities. TA helped me to define what plays have what probabilities, what to look for, and also - importantly - when NOT to enter. #1 rule of trading. protect capital. imo
t hat is great whitster......but a close #2 is increase ur capital......or why do it?........don't the fills become your enemy wi th short pts....scalping?