macd indictor lags, is there software that doesnt

Discussion in 'Technical Analysis' started by qwert, Aug 19, 2008.

  1. Hey Ptolemy!

    Welcome aboard. It took you long enough to get here.

    mp :D
    #81     Aug 23, 2008
  2. ptolemy


    Hey their Toptrader8. I did not know that that you were over here as well. Glad to have some company. So far so good. We have some smart folks here, only encountered a couple of cowboys but we will see.

    Do not be a stranger.
    #82     Aug 23, 2008
  3. Non-lagging indicator = Line on Close...:p
    #83     Aug 23, 2008
  4. ptolemy


    Let me restate, {although I think that you are just kidding around, a good sense of humor is needed in trading}

    There are no leading indicators other than Volume based. And even then you need to use caution and good Managment skills.
    #84     Aug 23, 2008
  5. hedonQ


    I can't speak for everyone but I can offer a practical opinion from my personal experience day trading gbp/usd
    using macd on intraday trends. ( in a range, macd did not work for me at all).

    Stating the obvious, I was always late (late potato or the gravy) or even missed out on some smaller trends because
    of the lag. But some of the trends lasted long enough to ride it out and to make some money.
    Sometimes, I broke my macd rule and got in a trade a bit early, just because the price pattern/action suggested
    what the market "might" do. MACD confirmed "a bit" later. Those were the best trades.
    Based on this experience and the fact that MACD is derived from the price why not follow the price itself?

    MACD is less subjective than price action. Specific rules could be applied to macd and followed. Also, since
    you're lagging, the price might have already "moved" and the picture is clearer.
    With price action, it would seem, the price pattern is never the same, the information is never complete and
    the picture not that clear. Price action/pattern requires LOT of screen time to understand what the price is
    suggesting. Not everyone is willing to put in the screen time to understand the dynamics, price patterns and
    its context.

    But If you do ...

    Bottom line, it's not about macd or pa but it's about making money. If you're making money with macd, good for
    you. If you stick around long enough and you're more of an artist, you'll gravitate towards price action/patterns.
    If you're more of a scientist, you'll probably come up with your own custom indicator.

    good luck to you.
    #85     Aug 23, 2008
  6. Well said. :)

    #86     Aug 23, 2008
  7. everything lags even 'price action' is historical. you can't trade it till you see it by then it's history.
    #87     Aug 23, 2008
  8. You can start here. There has been a lot of work, and most of it is not on the internet.

    The problem is, that even when some value is found, they tend to be useless once commissions, slippage and fees are included. This fact is usually left out by people who claim positive studies.

    Here is one book on the subject:
    #88     Aug 23, 2008
  9. ptolemy


    These studies are useless and do not address the real mechanics of Technical Analysis. We are not attempting to predict future price movment based on past price action. This study performed by "Academia" is no more insightfull than a study of Heavy Metal music conducted by the Boston Pops.

    TA is simply the study of current price action and how best to profit. Is it coincidence that price will stall at critical Fibonacci levels or even at Support or Resistance? One only need look at all charts to see this. Why do you think that there are those that make fortunes in the Markets?

    There are just as many studies for TA as thare are against. Just because you find a study on the internet where "Academia" was involved does not make it fact. The only real facts are gleaned from performing your own studies and the truth will either make you rich or it will make you poor. If your study makes you rich then Technical Analysis is valid. If it makes you poor then it is not.
    #89     Aug 23, 2008
  10. Actually, the Mesa Sine Wave indicator doesn't lag.

    But I don't have a clue about how it works, so I don't use it to trade.
    #90     Aug 23, 2008