Intuition Amplifiers 2

Good post, xspurt. Unfortunately, Marketsurfer won't read it since he has you on ignore (and he won't see this as he has me on ignore, too). Assuming they are coded, I think the PD's are a prime example of AI at work (artificial ignorance).

And to not derail this thread further - MAESTRO did kindly ask us to stay on topic --

1) Amplifying intuition is one thing, knowing it's something worth of amplifying is another. How do you handle that?
2) In what way are the IAs different from a fancy chart indicator (apart from there being no chart)? The way they are described they are not really fuzzy at all and you could hook up a trading platform and have it "go long when it's more blue than red and no yellow tint" and then backtest it all... or not?

Maybe we really need IDs instead (Intuition Dampeners) as suggested by NoDoji and Cornix... I know I don't have any working intuition at all, but I still have problems following even the simplest mechanical rules because somehow some part of me thinks I do.

 

surf is just Mr. A N Other trader - it applies to all of us, me included.

Great questions... So how do any of us know what is worth amplifying? For me it was always forward testing my What-If's (surf is doing that). Probably for most it is Backtesting.

I think the bigger problem is not how to handle intuition, but how to get the hunch and then connect it to an intuitive What-If? Too many traders ask the same questions and some don't ask at all. It requires a combination of creativity and later logic to discover a rough diamond that can be developed. It is quite rare because it is a bit like asking how do you write a hit song?

I better leave your 2nd question to MAESTRO. I could give my opinion but I think it better if the developer explains his thinking his first.

 

Great questions! I love when people think smart!

1) Amplifying intuition is one thing, knowing it's something worth of amplifying is another. How do you handle that?

Let’s take a look at driving. Experienced drivers have instant reflexes when they hit a patch of ice on the road. They automatically turn the steering wheel into the right direction to avoid the ”spinning” effect; they do not apply breaks, instead they use their engine to slow down the motion etc. They intuitively know what to do in order to avoid the crash. Is it something worth amplifying? Yes, the skill of accident avoidance is a very useful skill and developing the intuition that helps you in those situations is extremely useful.

I used to train jet fighter pilots. To them split millisecond decisions are the way to either live or die. They can use all the training they can get and all the skills and intuition they can obtain via developing their abilities to read the gauges of the cockpit. All the subtle signs of the combat situations that might change the odds in their favor are worth having!

So, how do we amplify their intuition? We develop the new breed of sensors, gadgets, gauges and other visual information enhancement devices to help them to be more efficient in obtaining those skills and developing better intuition towards the right decisions when logical thinking simply isn’t going to help!

So, I guess it explains what is worth amplifying in any type of dynamic decision making - it is the ability to efficiently process increasingly larger amount of critical information in less time. It is also an ability to make more productive decisions based on that information and ultimately increase the likelihood of winning the game.

2) In what way are the IAs different from a fancy chart indicator (apart from there being no chart)? The way they are described they are not really fuzzy at all and you could hook up a trading platform and have it "go long when it's more blue than red and no yellow tint" and then backtest it all... or not?

It is not about whether this particular gauge is a form of a chart or not. Ultimately, any graphical information on your computer display could be perceived as a chart of some sort. The difference is that it is not intended to use logic, i.e. “If-Then” type of the decision making at all. It is not designed to trigger the thinking such as “If the color is blue Then go Long” but rather to create the feeling of “stronger” or “weaker” bullish or “bearish” sentiments that might affect your decisions to Buy or Sell. Also, the price chart and all the possible indicators that could be put on it are limited in their abilities to present large variety of crucial information.

For example, the “Sentiment Spectrum” is created by processing lots of parameters taken from the Bid/Ask dynamics on the order book such as order flow rate, size fluctuations, filled orders volume etc. If I try to put all this information into a traditional price/time chart (of course, it is possible to do) it would not increase, but significantly reduce an operator’s ability to make rational decisions. It is not then an amplifier of intuition but rather an “Inhibitor” of it.

In order to illustrate even more please consider the piano as a musical instrument. Think of a chart as the succession of the notes on the note paper that represents music. Now do you see the difference between looking at the notes and playing the music? Do you also see the difference between painting and painting by numbers?

Any device, chart, visual aid, gauge etc. that increases your ability to efficiently process the feedback from your actions and deliver more efficient means of comprehending complex situations is the Intuition Amplifier. However, the science of what makes the information representation is more efficient and what reduces our abilities to comprehend it in real time is not trivial. It is not simply a matter of dumping all that we can measure on the chart and write the logic to “back test” it. It is not even in the same category. Most of my IA tools cannot even be tested on the historical data because they are based on commonly observed subjective reactions of individuals. The efficiency of the IAs is mostly based on the efficiency of the behavioural, cognitive and mathematical psychology models they use and not on “curve fitting” historical price data processing.

I hope I shed a bit more light on it. I will continue to discuss the science of IAs more in the upcoming posts. I hope the subject will be more clear when I present more of the IA examples and how they are used in active trading.

 

The first intelligent post on this thread.

 

I used to compare trading with other professions of skill, such as drivers or pilots too. But recently started to question such a belief (this wonderful thread sure helped to provoke some thinking ).

Reason is the following:

fighter pilot for example is a profession of absolute skill. "Do or die".

Trading however is different in the sense that regular tactical "die" is not a strategical defeat, not even a trouble, but integral part of the process of successful speculation.

It probably requires different approach than Top Gun like "be the best", because it would subliminally force trader to seek for a way to avoid losses as if they were negative events. Not a good trait to possess in order to trade successfully, especially for people who don't have consistent track record of their own trading yet.

So for a high-level professional developing into the intuitive stage of trading is a logical progress. For a person struggling to become consistent it may be the curse. Cause as NoDoji said earlier, "secret" of success is much related to making things as mechanical as possible.

 

Little rant above led to another thesis:

probably some traders would benefit from IAs while other traders need IDs (in terms presented by Tobbe), depending on their personal set of traits/issues.

 

Try to amplify ZigZag indicator.Market IS 'zigzagian' or 'zigzagerian',or 'zigzagianistic'.It is as close to Grail as it gets.

 

Thank you Maestro. I'll have to ponder your response for a while. And I'm looking forward to the upcoming posts.

 

at some point, thru practice and repetition,your skills will be strong enough(possibly there already and don't know it) that the fear will subside ,knowing that when wrong you can trade out of it,at that point your fear will subside and stop overiding your intuition

 

i pilot would not purposely crash a plane, a painter would not purposely dump paint on a carpet, a roofer walkoff a roof, but a trader(really a non trader) will ride a position til acct goes negative ,figure that one out