Is price action trading the most insightful(& most accurate)?

Discussion in 'Trading' started by orbit23, Aug 7, 2019.

  1. orbit23


    People trade using all sorts of indicators from moving averages to MACDs and RSI, and all of those might provide for a good and profitable trading strategy, but you don't really know what's actually happening.

    Trading price action for me means using no indicators, only the naked chart. It consists of really in-depth knowledge of TA, that is; the candles and how they work, support&resistance levels(of all sorts) and tracking the market structure(lows&highs).

    I also don't look at one chart only, but the market as a whole. Correlation and overall dynamics of the market are important. I don't look at volume, but i might use it as confluence, i find open interest far more interesting to see what's actually happening.

    I've only been trading for about a year now, but i have probably few thousand hours of staring at the charts behind me. Also worth mentioning i track mostly crypto. And i would say a day in crypto might equal to a week or maybe even a month in traditional markets, but the principles are the same. So you get to learn every trick in the book(read as: you get screwed), much faster.

    And even I, myself am surprised to the extent and reliability that the market moves can be predicted. So the question is, is PA trading, the most insightful and most accurate for predicting price moves? I believe so, and i also think that's how sophisticated trading bots work.

    I also think predicting is the easy part. The hard one is to actually execute and trade properly, which i am struggling with at the moment. I don't think it can be done without a thorough trading plan/system. That's the good thing about moving average crossovers, MACDs, RSIs and what not... they are simple - you see a crossover, you buy.
    The accuracy can also be a bad thing, because the fact is, you don't know what's actually going to happen and when you get on a streak and you think you know what's coming, you will bet big and blow it(speaking from experience lol).

    Just a rant.. what are your thoughts? What would you attribute your trading success to(or lack thereof)? Is it based on good read on the market, having a good trading strategy, both, or something else?
  2. MKTrader


    You need to hang out with @SA Market Forecaster. Of course he's feeling some heat from that "easy gold short prediction" he made. Before you make blanket statements like "the market is easy to predict," you need to codify then systematically backtest and forward test your methods. You'll be surprised how much hindsight bias, confirmation bias, etc. affects us and how "easy prediction methods" don't really hold up to long-term testing.
  3. tomorton


    My success comes from firstly finding trends (not hard) and joining them: secondly cutting the losers before they get as far as the stop-loss whenever possible.
  4. RedDuke


    Well, with such mind set and belief you setting yourself for a trap. This quote of yours made me smile this morning .
    qlai likes this.
  5. maxinger


    Decades ago, I started trading with hundreds of indicators.

    Now I have ZERO.
    I focus on chart pattern, price action, shapes
    Last edited: Aug 7, 2019
  6. orbit23


    Where have i said that it's easy? I've spent a year and a half glued to the screen watching tick by tick go by - probably 5-10hrs/day. I've been fuc*ed in every pore in my body twice.

    And what i meant by "predicting is easy", that even after you know what the market is going to do, it's hard to make profit off of it. I'm saying predicting is the easy part, then you have to make a trade out of it and manage it properly. I don't have a good system. with my "skills of PA" i can reliably predict what's going to happen and i'm right most of the time, but making good calls is not the same as executing them properly. I have good read on the market, but not good trades. Biggest fault is taking profits early(maybe i'm staring at the screen to much and am eager to take those profits and have difficulty sitting tight and letting the market do its thing, as well as leverage being too high(too tight entries& stops- trying to be right and end up empty handed, instead of playing loose stops and smaller position and making some money).

    Trader dante brought up that same point in one of his tweets;

    I'm not saying trading is easy. I think it's very very hard, and as i said i'm struggling myself and had i known what it takes i would've never started again.

    But i am predicting the moves with the reliability that even i am surprised. This does not mean that i know what the market is going to do at all times. But before the move happens, i almost certainly do.. I am a good caller, you could say. Now need to master the trading part hah.
  7. tommcginnis


    Sorry, Charlie, but "Japanese Candlesticks" are indicators: in one symbol, they contain 4 pieces of price/trade information per single slice of time.

    "Support & Resistance" no matter whether fancifully calculated or eye-balled onto a chart? Indicator.

    "Tracking highs & lows"? Indications.

    "Price action" is no more than T/A with blinders. :rolleyes:

    There are two ways (maybe purposes??) to predict market movement -- one is to be correct (and to benefit thereby), and the other is to not_be_wrong (and to merely survive the trade). Most discretionary traders predict market movement while needing to be correct. Most algo/RPA/non-discretionary traders predict the market so as to avoid being grotesquely wrong. (This is also the land of the option seller, true dat.)

    For sure, the discretionary traders make headlines. (Whether right or wrong, the headlines follow.) But what of all those "quant" funds? The ones who hire all the mathematicians, but are not engaged in HFT? What are *they* doing?:wtf: Hmmmmmmm. :rolleyes:
    Last edited: Aug 7, 2019
    beginner66 and They like this.
  8. pstrusi


    I've developed many Algos from many years ago, with a very different approach, that includes, but not only limited to: Price only, Last-Volume, Bid-Ask-Volumes...etc and I can assure this: in my experience, there's nothing as PA to work with.
  9. Should be obvious to all.

    As a market player, your ONLY objective is to have your position "in tune" with price. How do you go about that?

    KISS, baby. As always.
  10. wrbtrader


    Wow...all of this for trading cryptocurrencies in which a day of predicting will equal a week or month in traditional markets.

    You then will bet big and blow it in your cryptocurrency trading.

    I think you should spend less time on indicators and price action trading comparisons. In contrast, you should spend more time on yourself as a trader and equal time on money management (risk management).

    #10     Aug 7, 2019