indicator showcase

Discussion in 'Trading' started by darkhorse, Jul 8, 2002.

  1. After various flareups on the subject here and there, I thought it would be fun to see an informal survey of opinion on technical indicators(u guys fighting on other threads, why not bring your spats here....) What works, what doesn't, what has value, what's mumbo jumbo. To kick it off here is my .02 below. Just one dude's opinions based on observation, research and a wee bit o' experience. Let the free for all begin.
    :D

    p.s. thx mr. sub

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    baseless and useless: gann, elliott, fibonacci

    too close to coinflip: stochastics, macd, RSI, ADX

    (note: i reject oscillators largely because a trained eye does not need a filter to discern relative levels of strength or weakness.)

    marginal but maybe: trendlines, pivot points, bollinger bands

    valuable: moving averages, highs/lows, sup/rez, volume, volatility
    =======
     
  2. lundy

    lundy

    useful: ALL DRAW TOOLS. elliot, fibonnaci, gann, trendlines, chart patterns. (anything that compares the price/time/volume of 2 or more pivot points)

    useless: ALL STUDIES or INDICATORS. stochastics, bbs, macd, oscillators, ma's, etc.
     


  3. But a moving average is the purest way to visually compare current price with the continuum of closing prices preceding it.

    By your own criteria, doesn't that make ma's valuable?
     
  4. nkhoi

    nkhoi Moderator


    could you be a wee bit more specific, a chart would be nice :)
     

  5. i'm fresh out of spiffy visuals at moment, but if i get my hands on some i'll let you know....:p
     
  6. lundy

    lundy

    hmmm, your right.

    I should edit what I said to be:

    anything that compares two or more pivot points and how they relate in time/volume/price.

    edit: I shouldn't have skipped highschool. I must have missed the part about effective writing skillz.
     

  7. What about the inherent dangers of focusing on a single event or a single point in time? Doesn't extremely narrow focus raise the danger of false precision?

    Also, how do you overcome the objection that pivot points can only truly be labeled in hindsight? Short term traders can fight flukes by applying the method over and over, but at some point the length of the expanding time frame prevents redemption by spacing out the shots too much.
     
  8. Babak

    Babak

    Anything that is lagging is suspect.
     
  9. Bob777

    Bob777

    If I was allowed to put only one indicator on my charts, it would be the 20 period exponential moving average.

    When prices are choppy, it will move sideways. When trending, prices will bounce right off it. When the price gets too far way from the MA, it will snap back.
     
  10. lundy

    lundy

    In defense of fibonnaci, elliot wave, and gann, I have the following to say.

    The reason for the apparent flaws in these theories is because the application is incorrect, not because the theory is wrong.

    I consider the 2 major flaws in application to be the result of improper pointA/pointB coordinates and misinterpretation of pivots on a bar chart.
     
    #10     Jul 8, 2002