Contradicting TA

Discussion in 'Technical Analysis' started by Nutinsider, Oct 1, 2012.

  1. Its perfectly okay to not ever hear anything new.

    If you keep hearing noise that is perfectly okay, also.

    The OP had a breakthrough in both areas you mention, both opposite of your continuing experience.

    Anyone can solve anything they recognize it as a challenge. The fact of the matter is always: "if you are being challenged and you can't recognize it, you will never be able to move forward."

    Elsewhere someone thinks he recognizes me as as something he read about in a book he needs to own or use.

    He rearranges what he read to suit his purposes and posts it with full credit to the original author. Then, he expresses a need he has. We all want his need to be satisfied.

    Skin color is another facet of people. It may not be that a symmetric analysis can be done because of the orientation of the analyzer.

    If you do analysis from the viewpoint of fear, you may get different truths than a non fearful person.

    TA works only from the bottom up.

    TA does not work from the top down.

    When a person looks at longer and longer duration bars to figure out what is going on; he is simply saying he is not using TA properly.

    Lets say you red 50 pages in a book and you are asked to do a self check and they give you the wrong answer to a self check example.

    At the very end you did very well because you became freestanding and self confident by knowing their answer was wrong.

    Suppose you believed you were incorrect in doing the last example because you didn't get the correct result as told to you?
    Well thats just life for you and for the writer who has made a mistake.

    I know the the 50 page book will be corrected at some point.
    Why? Because the competition will surpass the work of the person who wrote the 50 page book.

    When I go in to change my tires, I have to put on the tires the mechanic specifies; he is not going to put on ordinary tires. My tires have to meet a racing spec because that is what the style of the car delivers to the road.
    #41     Oct 6, 2012
  2. river


    Jack, in your “key principles” attachment you posted elsewhere you wrote, “When you use volume to achieve the OOE’s, you need to suppress volume data that is not forwarding a trend. Price cases give you the suppression means.”

    I’ve been struggling with exactly when suppression is required. Perhaps I’m overcomplicating this. Would you be willing to help clarify my understanding?

    The FTP, FBP, and Sym formations seem clear: suppress volume for the second bar. Laterals lasting less than seven bars: suppress volume for the second and subsequent bars. Laterals lasting seven or more bars: use volume bars to form a subfractal.
    Outside bar: never suppress volume.

    Hitch: I’ve been suppressing the second bar’s volume because the trend isn’t being forwarded. Is this correct? I’ve seen hitches described as red hitches and black hitches but does this distinction matter since a hitch does not forward a trend?

    I find Stitches rather confusing: A stitch with a second bar HH forwards a trend in a “long” movement but a stitch with a second bar LL does not. So we would suppress volume in the second example but not the first? A stitch with a second bar LL forwards a trend in a “short” movement but a stitch with a second bar HH does not. So we would suppress volume in the second example but not the first?

    Is there some hierarchy of logic to determine volume suppression of multi-bar combinations of formations? E.g. a stitch with a second bar HH followed by a bar with an equal H but HL than the second bar of the stitch. The combinations could become quite lengthy and complex.

    #42     Oct 8, 2012
  3. MTRIG


    First start by removing all indicators from your charts and get familiar with some chart patterns. This may sound like you are missing something, but once you do this, you will find that price action is much clearer, and you will find entry points.

    To many indicators cause confusion, yes the cause conflict, and if you are looking at 1 Candle it is worthless.
    #43     Oct 22, 2012
  4. bone

    bone ET Sponsor

    Duplicative technical indicators of the same species are no good. In other words, as one example IMHO you do not want multiple oscillators. If you can design a system that provides trade entry confirmation using T/A's that sample differently and apply a genuinely different kind of study ( like, for example, a moving average cross and weekly pivot points ) then you will be better off for it.

    Patterns and T/A work fine as well. Use confirmation that is truly different than your baseline screening methodology.

    Occam's Razor applies here.
    #44     Oct 22, 2012
  5. this seems to make sense. like, don't use more than one momentum oscillator because one will tell you all you need to know about momentum? instead maybe pair a momentum oscillator with a trend, volume, or money flow indicator? or maybe all of them?!

    thanks for the response and staying on subject!
    #45     Oct 23, 2012
  6. bone

    bone ET Sponsor

    Well, IMHO ( just my 2 cents ) some technical studies are much more worthwhile than others. Combining a momentum oscillator with Market Profile or Point & Figure would likely be more effective than the ones you mentioned. Again, just my opinion.
    #46     Oct 23, 2012
  7. I'm not familiar with point and figure. I do like market and
    Volume profiles.
    #47     Oct 23, 2012
  8. bone

    bone ET Sponsor

    Combining trend lines or swing highs and swing lows with a technical study would be another viable option.

    From my experience, you want your confirmation indicator/methodology to be different than your baseline technical study. Think of it as "hybrid vigor" in genetics ( i.e., don't marry your sister ).
    #48     Oct 23, 2012
  9. bone

    bone ET Sponsor

    The biggest fault I see with "fundamental analysis" is that the trader knows far less about what true, legitimate fundamentals are driving that particular market and that chosen point in time - and they fade a big move. Same goes for "seasonals". For strange reasons, the fundamentalists that fade the market tend to take alot of pain and then justify the torment by lamenting that the fundamentals don't justify the pricing. And the longer that the market trades at that "wrong" price, the more the rest of the market accepts that new price level as fair.

    Prices that are not perceived as "fair" by the deep pockets are always very quickly adjusted.

    The biggest fault I see with "technical analysis" is the trader's study time frame interval selection: 1. The trader is using the wrong time interval, 2. The trader is not using multiple time intervals, and 3. the trader is using a time interval that is simply not compatible with his pain tolerance and his trading style and his holding period.

    Finally, most traders that I meet and take on as clients and who tell me that they trade with the trend are mistaken. They are not trading with the trend. Easy to say, harder to do correctly and consistently.
    #49     Oct 23, 2012
  10. This is an excellent post
    #50     Dec 22, 2012