Occasionally someone mentions that he or she trades using price action alone or with volume only. I interpret this fairly straightforward as meaning no stochastics, or moving averages, BB's, etc.. Would anyone who trades this way care to elucidate further? Thanks in advance.
This is pretty much what Tony Oz does. You can find out more about his strategy by visiting his website or reading his books (assuming you haven't yet).
Price... I confess to trading off of price action "alone". Sort of. I do keep short term RSI and Stoch, but don't take signals from them. Rather, I use them as a filter. That is, don't buy when indicators in top part of their range pattern, don't sell when in the bottom part. When the indicators get high or low into their ranges, I start looking for a price reason to make a trade. After all, our objective is not to be in tune with Stochastic, but rather in tune with price... is it not?
There are all kinds of ways to get good results from charts. Some folks use moving averages and stochastics and even old fashioned wedges and pennant drawings to figure out what a stock might do. My advice is to try several out and use what seems to work best for you. Disregard Chart Nazis who try to dictate to you the ONLY way to use charts. They are generally insecure and are probably lousy traders to boot...
I successfully daytrade NYSE stocks from the tape alone. I do have the intraday charts for the stocks I trade, but they don't have any TA indicators on them, and I hardly even look at them.
yup, same here. oscillators take simple data and make it complicated. do you think a specialist sits there waiting for his RSI to cross below this, that, and the other thing??
specialist, sees the order flow and picks out suckers all day long, dont glorify them, their edge is order flow
PA is that magic word that sounds so cool. "I trade price action". Does that sound soo sexy? Usually what is meant is higher/lower highs/lows, retracements, tests, trader vic's 2Bs and trendline breaks, chart patterns like ranges, triangles, flags and stuff. It's pretty darn discretionary. What looks like a flag this minute might not look like a flag tommorow to the PA trader because "it just doesn't look right" or some other extrenous reason like "well I didn't like the TICK here."