Surf, Seeing as the discussion is intensifying, here's something for your reading pleasure during the summer holidays. I know you'll probably say you've read them all, so maybe as a refresher. I think P&F is the least complicated. http://www.bloomberg.com/news/artic...rt-learn-to-lose-less-money-learn-these-books
Most profitable discretionary (not using automation) traders that use "price action" are not using it alone regardless if they talk about those other things in their trading plan or not. Simply, there's no such thing as a "pure price action" trader unless there's a different definition out there for such for the purpose of debate only. Every time I see a price action trader say that they are a "pure price action" trader or they're not using anything else... I then review their posting history and I see them talking about other components in their trading plan (e.g. money management, market context, global economic events and many other things). It doesn't matter how much they're talking about those other variables...the fact remains that they do talk about such as being important. Further, Thomas Bulkowski of thepatternsite.com once said about 86% of chart patterns are duds. Compare that to other academia studies and real-money trading...you will find numbers ranging between 82% to 96% of the known chart patterns to be duds. The results differ mainly due to trading instruments, duration of testing and trade management rules. Regardless, nobody is debating the issue that most patterns are duds. Just like nobody is debating that most traders will fail. The issue is this...he and others are also saying there are chart patterns that currently are outperforming the markets but they won't last. Thus, if you're a price action trader worth anything...you'll exploit the pattern until market conditions change (it changes many times per year)...forcing you to adapt or switch to another pattern. Think about it, trading forums are littered with trade journals where traders say things like "its profitable in the morning but I lose it all in the afternoon". Why don't those traders have a light bulb moment ? Don't trade the afternoon and your losing trade method will then become a profitable trade method. This is called adapting.
Brother Surf is the main biyayatch on ET, constantly pointing out inconsistency of other traders in comparison to what, his virtual track record? He even posted himself that he has many losing trades, yet it's somehow not an issue for Price Drivers, but is a problem for everyone else.
Why don't you get off your ass and see if you are smart enough to figure out how much money wrbtrader makes trading and for how long he has been doing it with price action trading only instead of spewing out filth from your dumb ass? It's obvious you can not make money trading price action and gawd knows you can't make money using indicators so you are here just to act like a retard. Good job btw. So why don't you slither back to the losers club you came from and leave the people alone that can make money trading price action. Don't let the door hit your butt on the way out you might knock yourself out.
Most trading systems paired with money management will make money, you can't discuss one without discussing the other.
A pure price action trader trades off key price levels. Nothing else is needed other than the ability to look at a chart and see prior levels that will be defended. The defense will either succeed or fail. Statistical analysis is the tool for determining how far to let price run against you before the odds of price reaching a particular profit target diminish into negative expectancy. A pure price action trader doesn't need chart studies or indicators. In fact, if a price action trader doesn't consider a moving average to be a key level, s/he doesn't even need that. In my "Help, I've Been Chopped!" thread, I provided an analysis for someone. Notice how jack411 placed horizontal lines at key levels and I added some of my own. Only support and resistance levels are needed by a pure price action trader to determine risk:reward parameters for trades and these levels can be found on a chart that displays nothing but price bars. http://www.elitetrader.com/et/index.php?attachments/chopanalysis1-png.138421/
Years ago back in the late 90's, my definition of a pure price action trader was someone that didn't use charts or indicators. He/she was only a DOME trader, bid/ask screens, times & sales info only. Back then, I prefer to just use the traditional phrase...tape reader. Nowadays, I don't believe they exit via a different definition. Thus, it seems like that phrase pure price action trader has morphed into something else. Regardless, I do disagree with the nothing else statement but only because I've seen so called pure price action traders talk about other important things in their trading plan that they use besides price action to make trade decisions. Therefore, it looks like that you would call someone a pure price action trader that's heavy into money management (risk management) if they uses chart analysis and nothing else on their charts ??? How about a price action trader that also uses volume analysis and no other studies on the chart...would you call that trader a pure price action trader ???
Nice ad hominem. How old are you? 12? I don't need to figure out how much money wrb or you are losing...just post proof. Take your name, account #, etc. of your brokerage statements for the last 3 years and put them up. We'll all be in awe...or not.