Brother Surf...Since you haven't been a day trader since 2005, how is it you can be telling people how they need to trade?
You may find your answer here http://thearorareport.com/ZYX METHOD.htm Please study the section titled Technical Analysis Screen. Traditional concepts increasingly do not work, but new concepts work great. To stay successful at trading, you have to constantly change so that you maintain your edge. Good Luck, Nigam
Brother Mac, with all due respect, if you are watching price action all day on your chart, then that is what you are basing your trades off of, right? Of course, proper money management is a big part of what you are employing also. But the conversation has scarcely touched on that part of the equation. When some hear the words price action and/or technical analysis they automatically want to start screaming about how wrong you are without consideration for your trading plan. They think we are just jumping in at some arbitrary point with no thought for what might happen next and for the probabilities that occur over and over and over again. But, hey, if nothing else, it's very good entertainment.
I'd be much happier to believe it's more like 99%. Seriously, 90% would make it way too easy game. Success rate in other good games, such as becoming even local champion (not even speaking of Olympic winner) in any kind of sports is way, WAY lower.
In my experience 90% lose not because they use charts, they would lose without charts just as well, and they actually did lose before TA got popular too... Now, you say taking trades based on what chart shows is BS... What makes you think it's impossible? As for institutional traders, they probably trade differently not due to absence of self-control etc. But because institutions have very different requirements to their strategies (from risk management point of view etc.) which are not too compatible with relying on some guy or girl who "can read the charts".... By the way, do you consider old style "tape reading" to be a myth too?
You didn't answer my question... Is it really the most optimal or the only way to trade in your opinion?
Because Goldman cannot drop 10K all at once into the market, it will come in stages. The way these stages are read is called a gaussian. You will see a change in the gaussian in enuf time to capitalize on this.
Surf is right on this one. I won't say TA does not work, but I will say that indicators are suboptimal. They are derivatives of price or volume, every last one of em. So it would do one well to learn price and volume directly.
Here is another profitable entry . It is not the optimal way to trade , but it is simple and easy. Use a unique betting sequence starting with a smaller than normal position size and traders will always end up profitable on a monthly basis. Trading is very simple.