Why TA does not work

Discussion in 'Technical Analysis' started by JMN459, Oct 9, 2012.

  1. just for fun to post, since ET are full of shits for amusement purpose.

    for trading, if you seriously, better keep it yourself. whether I lost or you won, no one cares, only the persons involved care.

    come here not to seek trust, trust myself is good enough. my ego is not so big enough to let everyone know I makes money.

    last week I entered CHK/MPEL. yesterday I entered AIG 36.5 call.

    I am not interested in live post. just come to relax, share some thoughts.



     
    #141     Oct 16, 2012
  2. MadeMan

    MadeMan


    OK .. enough with that babbeling.. Im in .. what is the controlled envoirnment ?


    i will proof to you and any sceptics out there , that u can read the chart like a book! and participate in the most favourable way in the story beeing told ;) ...



    so how do we approach this ?

    cheers
     
    #142     Oct 16, 2012
  3. Great! Join us in the Combine and prove your claims
    http://www.elitetrader.com/vb/showthread.php?threadid=250400

    However, I doubt we will see you there. All other TA users have backed out.

    surf
     
    #143     Oct 16, 2012
  4. MadeMan

    MadeMan

    Im in


    do i need to setup a paid membership account ?
    or a two week free trail ?


    NVM

    just found your link

    thnx

    cya there
     
    #144     Oct 16, 2012
  5. Fantastic! Win or lose it's a great opportunity to support your claims and possibly get funded with zero risk OPM. Please keep us updated and let us know who you are in the Combine before you start. Thanks!!
     
    #145     Oct 16, 2012
  6. MadeMan

    MadeMan


    well, i will start a new thread .. as soon as everything is setup

    cheers
     
    #146     Oct 16, 2012
  7. NoDoji

    NoDoji

    Your ego is big enough to post after the fact wonderful trades you made, so your ego is indeed big enough to let everyone know you make money.

    When you post for entertainment, that's fine, but when you come here and make blanket statements about how TA doesn't work and how a stop loss will make you give up your money consistently, how a stop loss will make you over trade, leading to failure (I'm thinking maybe this happened to you and you're projecting it onto everyone), then you're posting garbage, not entertainment.

    Overtrading, revenge trading, ego-driven trading/failure to take a small loss, designate a failure to have a probability-based plan and failure to master the trader's mindset necessary to put that plan to work.

    None of these problems are the result of trading based on TA or of trading with a stop loss.
     
    #147     Oct 16, 2012
  8. Sorry to disagree with this sentence--- do you expect any less?

    :D ,

    BUt it has been proven time and time again that stops actually degrade the performance of trading systems. This is tested fact, you simply can't argue with it.
    http://epublications.bond.edu.au/cgi/viewcontent.cgi?article=1086&context=infotech_pubs

    in addition, see evidence based TA by aronson and larry connor's work for further hands on proof.

    <i>The vast majority of trading books persistently urge
    traders to use initial stops. The implication is that
    trading without stops is like driving without a seat belt –
    risky.
    Although the logic of saving a losing trade from losing
    even more money appears impeccable, the conclusion
    from this work is that implementing initial stop losses
    into a trading strategy will degrade portfolio
    performance in the longer-term.
    Having conducted the methodology described in this
    paper on a large number of trading systems, it appears
    that initial stops placed using the methods detailed in this
    paper are counterproductive.
    In no case tested does the use of stops either
    significantly reduce risk or significantly increase returns 4
    – both of which should be the primary goals of every
    trader.
    Many traders may feel uncomfortable with the idea of
    not using initial stops. However, from conducting this
    study on a variety of trading systems, one observation is
    crystal clear: If a trading strategy has a positive
    expectation, then the use of initial stops will only serve
    to degrade performance.</i>
     
    #148     Oct 16, 2012
  9. I once used stop loss, but found it slowed my action, distracted my focus. it is counter-productive to me.

    I shifted my focus on winning each war possible, prepared beforehand, think ahead of one step even two steps.

    of course most time I trade OTM options, there is no sense in stop loss since OTM just several tens cents, my risk is built, plus volume. speculation is different from TA trading.

    I bought AAPL 650/645 puts when it hits 649.5. now you are happy, wait to see I am going to lose big? relax, watch it unfold.

    some qqq 68/67.5 puts.


    everyone is different. I do have wonderful trades this year, like KBH, FB, AAPL, NFLX,... and I have lots of small losers, I thought those are just normal baits.



     
    #149     Oct 16, 2012
  10. tobbe

    tobbe

    Why do you keep referring to a book you obviously haven't read? You think it proves that TA doesn't work when in fact all it did was describe a way of testing simple trading rules.

    In Aronsons own words (p 450): "Perhaps the biggest deficiency of the case study was the failure to consider complex rules. This is a severe defect for several reasons. First, few TA practitioners, subjective or objective, restrict themselves to decisions based on one rule. [...]. Second, complex rules should produce superior perfomance on difficult prediction problems, such as financial markets."

    Anyone that has done any serious system development knows that the components of a system are interrelated and can't be tested separately. It's like playing a game of whack-a-mole. Saying that "stops degrade system performance" is just plain stupid. It is certainly true for some systems, but it is not true for all systems.
     
    #150     Oct 16, 2012