"if you want to win money...

Discussion in 'Trading' started by mounafia, Jan 3, 2011.

  1. mounafia


    ...forget about indicators"

    I have read numerous time this advice and I always thought that it was because peoples did not understood indicator and that there were a mandatory help.

    I was wrong...they were correct.
  2. Define indicator.

    Price is also an indicator, volume too. You are speaking too generally. Everything is an indicator. Stupidity too.
  3. mounafia



    if you want peoples to answer your questions maybe you should not insult them.

    Grow up.
  4. Samsara


    I wholeheartedly disagree.

    If you backtest a system, you have no choice but to use various indicators in order to model aspects of price behavior. Some of them provide very good tools for anticipating change. Being familiar with the code and basic math behind some of them helps.

    Throwing up a chart with RSI and entering/exiting discretionary on every 80/20 cross though does not help.
  5. jokepie


    Manual trading is like the king of trading styles; like hold'em NO LIMIT.
  6. Handle123


    I use price action and indicators in my trading. I have used them for 30 years, it still comes down to looking for patterns within price and looking for patterns within indicators. I believe most traders use indicators as they are written in books as in when X crosses Y, but if one looks "outside the box," indicators can offer small nuances that are much harder to see within price. If they were all taken away as far as indicators, sure I can trade and have to concentrate much harder, but I can sit several feet away and it just makes for a quicker identifier for me by using them.

    I will agree though, most don't know how to use and only confuse. Just like taking a 20 EMA, so many will say if price above, trend is up and yet, this shows me nothing, as I look at it I take into consideration the speed of change, slope, mean reversion and time. If EMA is cutting thru center of most bars, many can't easily identify chop cause they are centered so close to each bar, they don't see the Forrest.

    Another problem I see often is too many are trying to get the fastest indicators for reversals, that for most are just wasting time and money, too fast offers too many false patterns and too much overtrading. But using just price, same can happen in doing breakouts or breaking of pivots.

    Indicators are like anything else, whether it is price, volume or a moving average, the more you study, the more you learn about relationships. And for me, blending of both just makes it easier for me, but watching many for such a long duration certainly has it's advantages.
    beginner66 likes this.
  7. Indicators are usually formulations of streaming data or a specific rule set applied to streaming data.

    The history of markets, investing and trading are replete with all kinds of indicators.

    Any display can fit th definition of an indicator.

    certainly there is also an abundance of advice regarding indicators.

    I view indicators as very helpful in many ways.

    From my experience observing traders and potential traders, most orient to using indicators to confirm what they are doing with their givien approach.

    It is possible, as an alternative, to use leading indicators of what you trade to eliminate risk and its associated crutches.

    Waffling on accepting or rejecting indicator advice or indicators themselves is common among those on a path to the EXIT.

    the most commonly platform provided indicators were invented well before the PC. Thier longevity speaks well for them in the sensee that it is possible to measure what is happening in markets to a given degree.

    When any person compares the market's offer to the SW wisdom as to waht is possible to mkae financially, indicators well out perform the common beliefs of traders.

    This simply means that most people do not know how why and when to use indicators.

    Consider the trader who does the same thing all day long. He is going to fail simply becaus he cannot apply the correct tool at the correct time. The OP is in this boat.

    If you read any posts, take the time to figure out if the poster does the same thing all of the time. You have met people who do not know the time of the day. They wear wrist watches usually.

    The common characteristics of traders are: overreaction, underreaction and irrationality. What relation would indicators play to these conditions found in failing traders?

    When are traders most functional? Pre events and up to events.

    When are traders least functional? During post events.

    Now consider a most common Myth of CW: all indicators are lagging.

    This old saw is just a statement that not much of anything is known about the signals any indicator is capable of providing.

    I've enjoyed inventing a lot of indicators. Most are leading indicators of what I trade.

    How would you combine the following three data feeds to get a learding indicator of the ES.?

    1. DJ cash

    2. the Premium

    3. DJX.X or YM.

    This leading indicator focuses on the insurance needs of big money. It answers the question of do you buy just a car or both car insurance and the car before you drive the car.

    I do not like to trade ES without knowing what the smart money is doing before I am holding a position in ES. Certainly I reverse sides along with smart money and ahead of the smart money.

    To the SEC this type of trading profiles as their rule set for "insider" trading.

    By using 10 to 12 leading indicators of what I trade, I am able to continually take the market's offer to the extent of that unfolding offer.

    So how does Monitoring, Analysis, Decison making and taking timely Action (MADA) step up and repalce the betting routine (OODA) of the CW of the OP?

    All information is processed data from raw data and all processed fata is displayed as market indicators. CW places a bet and tests the validity of the bet. Mostly, the CW players believe that indicators lag.

    The missing link for these people is the mistake they make in thinking their is a need to bet, control risk (stops) and manage money (put the least amount of money in each bet).