Hypothesis: Technical Analysis only works in the immediate short-term

Discussion in 'Technical Analysis' started by Investor, Oct 2, 2016.

  1. You guys talking about using TA in short time frames are nuts! If TA is predicting a move in the short run (like minute, by minute), then it's doing so based on the existing market volume. Then a big trade comes across where someone wants to buy or sell a large volume in a hurry, and conditions just changed. IMHO, you need to trade in a time frame long enough that large orders aren't going to swamp your row boat. Yes, you can trade in the short term, but you're taking a big risk for not much more return than swing trading which doesn't have the kind or risk.
     
    #71     Jun 20, 2017
    comagnum likes this.
  2. Mtrader

    Mtrader

    If you really are a "Buy and Hold Real Estate Investor" like you mention in your profile, you have no experience at all about daytrading. So what is the value of your posting? I daytrade about 30 years and never had the probem you described.
     
    #72     Jun 20, 2017
  3. In real life though I think you'll find that most of the time the big orders of which you speak are placed in the direction of the trend. So as long as you are not positioned against the trend, no problem. And for those orders that are executed against the trend, the trend itself will restrict the extent of the move.
     
    #73     Jun 20, 2017
    Mtrader likes this.
  4. Seriously? I've been subscribed here for 13 years!

    Glad it's working out for you. I'm just saying that the predictable big waves you're trading are calm seas that I swing trade. The only waves that capsize me are the huge events that rattle the entire market. I'm sure you can make money doing what you do. But I marvel at it, because the risk doesn't seem to be worth the additional reward to me.
     
    #74     Jun 20, 2017
  5. Mtrader

    Mtrader

    What looks as not interesting to you can be interesting for somebody else.
    There is no additional risk to me, only additional reward. My stats confirm that over and over again, year in and year out.

    I started to daytrade because I felt too stupid to trade longer timeframes. No joke.
     
    #75     Jun 20, 2017
    jl1575 likes this.
  6. True but if TA was upgraded to include indicators calculated objectively.
     
    #76     Aug 2, 2017
  7. bone

    bone

    That's where algorithms are born .....
     
    #77     Aug 2, 2017
  8. Let's not even talk about that before we can get indicators which are NOT HAND drawn like .... the infamous ' trend lines ' and the elliot so called wave. I mean why not use basic linear regression ? It's So stupid.
     
    #78     Aug 3, 2017
  9. Simples

    Simples

    Have you actually tried drawing parallell trendlines before calling something stupid?
     
    #79     Aug 3, 2017
    bone likes this.
  10. bone

    bone

    Having used both, I'd take a proper trendline over linear regression any day of the week for the my purposes at least.

    Elliot Waves and other wave count generators don't work - at least I've personally never seen it hold up with any consistency over time. But they do make convincing charts after the fact as the historical wave counts and locations change with the current market price action. Again, that's been my own observation.
     
    Last edited: Aug 3, 2017
    #80     Aug 3, 2017
    themickey likes this.