A mind that has gone through the process of creating a spectrum of differentiation. This process can be approached a variety of ways - from methodical testing via trial and error at one end to deductive reasoning at the other. At first, purposeful learning leads to understanding underlying principles. Applying principals that produce repeatable results leads to confidence. Understanding and confidence as it relates to market dynamics leads to making timely decisions. Timely decisions lead to appropriate actions. Evaluating actions creates a feedback loop. Feedback loops create an environment for adjustments and refinements through observations, insights and testing those insights. The process is cyclical and becomes a routine. The routine builds capacity. A mind that has built a spectrum of differentiation understands the benefits and limitations of any technical indicator that functions mathematically. The market is the ultimate teacher with the correct answer always. Sometimes the answers come during rth, other times through debriefing a day. The basic grandularity is p and v and the relationship between the two. A tool of itself has a function but no utility. The utility comes from the mind that understands the effect the tool is used to cause. Edit: Therefore any indicator usefulness and utility has less to do with the indicator and more to do with a market participant’s interpretation of it. Interpretations comes from perceptions filtered through beliefs. Most beliefs are adopted via enculturation as others are self-chosen. Beliefs are a fundamental cause of perceiving the market’s system of operation or the lack thereof. Beliefs are mutable provided the initial reference points and associations of that belief are updated. One aspect of ourselves that gets a bad rap is the role of feelings and emotions as it relates to trading. Feelings and emotions are distinct. Feelings are a form of sensing. Sensing is an attribute that is difficult to put into words and a potent tool for a discretionary trader. Sensing can be trained.
Lower highs, higher lows (and their cousins once-removed: double tops and double bottoms). The stop being hit. The entry failing to trigger. Changes in the angle of trend. Certainly there are some people who jump into the market with such a glaring insufficiency of knowledge that we can predict with fair accuracy about how long it will take them to lose their capital. It may not be so obvious that there are others, hardly any better off, who collect unnecessary and irrelevant facts the way a pack rat collects bits of colored glass, beer bottle tops, and buttons. Too much information of the wrong sort not only adds nothing to clarifying understanding, it can confuse the issue so hopelessly that it is impossible to see what is going on at all. –John Magee
There is no single indicator that's better than the rest of them. Instead, it's a combination of indicators that results in a great trading model.
No. But I'm only half joking - he clearly indicates multiple indicators is better than one. I tend to think one is bad enough.