Which two indicators would you use?

[Sunder]

Hey peoples.

After 9 months of trying to actively trade instead of investing, and being mildly down on my capital, I figure that my methods so far are pretty much throw a dart at the dartboard and hope for the best. The only bright side I have is that I'm down less than the market overall - but not by much.

There are things I have learned, mostly to do with trading discipline, but I think my methodology needs a serious overhaul.

I first started using a 10 Day EMA as my "fast moving" indicator, and a 26/12/9 MACD as my slow moving indicator, and when both agreed, I went in. The theory was that having a fast and slow moving indicator means I could get most of the movement, but miss the volatile whipsaws.

Obviously, since they're both moving average based, I decided this was bad, and started playing around with RSI - 5 day and 14 day Wilder. However, my feel is that RSI is still a moving averages based indicator, just with a different formula.

So, my question is, if you were to use two indicators to signal and confirm, which two would you use?

My overall trading strategy is divide my capital into five, and spread them out across ASX CFDs, no two being in the same sector. At any time, one or more of those five parcels can be in cash rather than in a CFD, and positions can be long or short. Obviously a high risk investment strategy, but it's not my retirement money I'm playing with here. Just a spare 20k I have.

Thanks heaps for advice and input.

[IFocus]

Hey peoples.

After 9 months of trying to actively trade instead of investing, and being mildly down on my capital, I figure that my methods so far are pretty much throw a dart at the dartboard and hope for the best. The only bright side I have is that I'm down less than the market overall - but not by much.

There are things I have learned, mostly to do with trading discipline, but I think my methodology needs a serious overhaul.

I first started using a 10 Day EMA as my "fast moving" indicator, and a 26/12/9 MACD as my slow moving indicator, and when both agreed, I went in. The theory was that having a fast and slow moving indicator means I could get most of the movement, but miss the volatile whipsaws.

Obviously, since they're both moving average based, I decided this was bad, and started playing around with RSI - 5 day and 14 day Wilder. However, my feel is that RSI is still a moving averages based indicator, just with a different formula.

So, my question is, if you were to use two indicators to signal and confirm, which two would you use?

My overall trading strategy is divide my capital into five, and spread them out across ASX CFDs, no two being in the same sector. At any time, one or more of those five parcels can be in cash rather than in a CFD, and positions can be long or short. Obviously a high risk investment strategy, but it's not my retirement money I'm playing with here. Just a spare 20k I have.

Thanks heaps for advice and input.

1st question show us your test results..........that comes before trading, I know its boring and lacks the excitement and thrill of trading live.

Indicators are best for maybe showing market conditions i.e. trend up trend down, side ways maybe also for finding divergence, for entry exit they generally suck.

[Sunder]

Well, that's the thing, my "Test" results using live money, show me that I'm behind

So... If you're not using indicators them as entry/exit points, what are you using?

I'm combining with stop loss obviously, but most often, my stop losses are when the indicators turn, which mean they're usually fairly large.

[Whiskers]

So... If you're not using indicators them as entry/exit points, what are you using?



EW. :o

No, I use a number of indicators including EW lately.

But I'd say if you had to use two, they'd be the MACD and DMI.

I don't think it would help if I just spelt out all of what I use, because the way it works for me is from getting a good understanding of the indicators that suit my trading/investing style and gelling that with a bit of FA.

MACD and DMI can tell you a lot. I studied everything I could find about them until it became second nature, then progressed onto other indicators to compliment and fine tune them.

Also I presume you are only using daily charts. A couple or three different time frames can give a clearer picture, eg hourly, daily and weekly.

[skyQuake]

Don't use price based indicators. That's my recommendation anyway, I've wasted years on those. If a freely available public indicator can make u money, why isn't everyone making money off them? Changing parameters only serves to 'curve fit' for past results.
Also as a rule of thumbs, indicators lag price action. Why trade on old data? Can you base today's buying/selling on last week's data? Another problem with them is that they try to pick tops and bottoms (oscillators). You will get killed if the trend is strong (ie someting staying in oversold for months) or when its chopping (you get craploads of false breaks).
Learn to read price action, volume, few trendlines and maybe some other stuff. But imo, price based indicators as a group are a waste of time.

[mazzatelli1000]

Don't use price based indicators. That's my recommendation anyway, I've wasted years on those. If a freely available public indicator can make u money, why isn't everyone making money off them? Changing parameters only serves to 'curve fit' for past results.
Also as a rule of thumbs, indicators lag price action. Why trade on old data? Can you base today's buying/selling on last week's data? Another problem with them is that they try to pick tops and bottoms (oscillators). You will get killed if the trend is strong (ie someting staying in oversold for months) or when its chopping (you get craploads of false breaks).
Learn to read price action, volume, few trendlines and maybe some other stuff. But imo, price based indicators as a group are a waste of time.

I wouldn't go so far to do away with price based indicators. It is good to be aware and understand how they are derived, even though you may not use them exclusively to trade off.

Sunder, since you mentioned placing trades in different sectors - an understanding of intermarket and sector relationships may help as well.

[Sunder]

I wouldn't go so far to do away with price based indicators. It is good to be aware and understand how they are derived, even though you may not use them exclusively to trade off.

Sunder, since you mentioned placing trades in different sectors - an understanding of intermarket and sector relationships may help as well.

Thanks for the advice so far guys.

I don't think price based indicators are useless - every indicator is basically public now - why aren't people all making money off whatever it is that works if it's not price based? Sure price based ones are simpler, but that doesn't mean if there was another secret reliable method, people wouldn't all be flocking to that too... My guess is that the problem is people either

1. Are undiscipliend
2. Don't understanding what the indicators actually mean, and therefore mistrading them. For example, some people who I know who've dabbled in trading on EMAs, don't know how to adjust the time frame of an EMA calc if market starts ranging instead of trending.

With regards to the sector relationships, could you expand? Do you mean how Gold stocks usually go up when financial stocks go down and vice versa?

[posh]

i know people who make no use of indicators and do it better.

[sreenathc]

Hi,
I find that if there is a trend....either up or down, following Renko charts, it is possible to catch about 70-80% of the trend and make money....however, in a choppy market this will make you lose money in small bits many times!!

I find using divergences in Stochastic Oscillator and MACD seems to give a fairly good percentage of wins....

Cheers,
Sree

[cordelia]

Hey peoples.

After 9 months of trying to actively trade instead of investing, and being mildly down on my capital, I figure that my methods so far are pretty much throw a dart at the dartboard and hope for the best. The only bright side I have is that I'm down less than the market overall - but not by much.

There are things I have learned, mostly to do with trading discipline, but I think my methodology needs a serious overhaul.

I first started using a 10 Day EMA as my "fast moving" indicator, and a 26/12/9 MACD as my slow moving indicator, and when both agreed, I went in. The theory was that having a fast and slow moving indicator means I could get most of the movement, but miss the volatile whipsaws.

Obviously, since they're both moving average based, I decided this was bad, and started playing around with RSI - 5 day and 14 day Wilder. However, my feel is that RSI is still a moving averages based indicator, just with a different formula.

So, my question is, if you were to use two indicators to signal and confirm, which two would you use?

My overall trading strategy is divide my capital into five, and spread them out across ASX CFDs, no two being in the same sector. At any time, one or more of those five parcels can be in cash rather than in a CFD, and positions can be long or short. Obviously a high risk investment strategy, but it's not my retirement money I'm playing with here. Just a spare 20k I have.

Thanks heaps for advice and input.

well quite honestly you have probably picked the worst time to learn to do anything..Even experienced traders would be hard pressed to make a dollar in this market...

if you are inexperienced just sit on the side lines and watch..we are going through ahuge financial upheaval...Only a fool would sail a dingy into a hurricane..

[julius]

Hi Sunder,

If your method is that simple then it can be mechanically backtested.

If you want to understand what works and what doesn't, then this is your best bet.


Hey peoples.

After 9 months of trying to actively trade instead of investing, and being mildly down on my capital, I figure that my methods so far are pretty much throw a dart at the dartboard and hope for the best. The only bright side I have is that I'm down less than the market overall - but not by much.

There are things I have learned, mostly to do with trading discipline, but I think my methodology needs a serious overhaul.

I first started using a 10 Day EMA as my "fast moving" indicator, and a 26/12/9 MACD as my slow moving indicator, and when both agreed, I went in. The theory was that having a fast and slow moving indicator means I could get most of the movement, but miss the volatile whipsaws.

Obviously, since they're both moving average based, I decided this was bad, and started playing around with RSI - 5 day and 14 day Wilder. However, my feel is that RSI is still a moving averages based indicator, just with a different formula.

So, my question is, if you were to use two indicators to signal and confirm, which two would you use?

My overall trading strategy is divide my capital into five, and spread them out across ASX CFDs, no two being in the same sector. At any time, one or more of those five parcels can be in cash rather than in a CFD, and positions can be long or short. Obviously a high risk investment strategy, but it's not my retirement money I'm playing with here. Just a spare 20k I have.

Thanks heaps for advice and input.

[Sunder]

Hi,
I find that if there is a trend....either up or down, following Renko charts, it is possible to catch about 70-80% of the trend and make money....however, in a choppy market this will make you lose money in small bits many times!!


That's what my first set of indicators back tested did. You can see what it did to me when I tried it since about August 1. Whipsawed every 2-3 days, and no movement anyway. Death of a thousand cuts. $300 here, + trading fees. $300 there, + trading fees.. :banghead:


well quite honestly you have probably picked the worst time to learn to do anything..Even experienced traders would be hard pressed to make a dollar in this market...


I think I have, but at first I was insistent on staying in, as I knew if I could learn now, I could learn to trade any time. However, I am temporarily admitting defeat... Or maybe just regrouping in the corner, while I forward test this new strategy. I only have "Incredible Charts" as my stock picking software, along with some perl scripts I have written, so back testing on DMI is not possible, but I am intrigued, so I am forward testing on the ASX CFD simulator.

Does make me feel better though, that you say that it's a difficult time. I've heard some people say that this is the best time to make a quick buck. Best time to lose a quick buck too, I guess.

[IFocus]

Sunder I take it you are trading end of day



Well, that's the thing, my "Test" results using live money, show me that I'm behind


Being behind is not the problem that will come to haunt you. Testing using live money as you put it will almost certainly create the wrong behavoirs for trading, making profits comes from correct trading behavoirs.

Testing is the 1st step to creating correct trading behaviors.


So... If you're not using indicators them as entry/exit points, what are you using?

I trade with trends no trend no trade this is the basis for 90% of my trading method. There are many other nuances but this is the foundations.

Next I enter using price action that has formed a pattern that signals possible trend continuation again some nuances but the pattern must fit a money management criteria.


I'm combining with stop loss obviously, but most often, my stop losses are when the indicators turn, which mean they're usually fairly large.


Not good enough your stop loss position must be in combination with your money management criteria.

Start by reading Nick Rades book Adaptive Analysis

Professionals test because its not about the dream, excitement, passion etc its about business, punters gamble because of the dream, excitement, passion etc.

Hope this helps

[tech/a]

http://www.aussiestockforums.com/forums/showthread.php?t=12591

Shows the basis of some of my discretionary setup.
As for indicators.
Pattern (not Radges PPS)
Price
Volume

Then and most importantly letting the trade come to you.
In the case shown in the charts on the other thread above I was aware of the setup around a week before the trade came to me.

It is very simple yet we tend to make it as acomplex as possible---thinking that complexity MUST = accuracy.

[BBand]

Hi Sunder,
Don't give up - there's money to be made in the market when the conditions are correct.

Its not rocket science either!

Just understand that a particular setup that works when the market is trending will probably not work so well when it is not
If you want to be in the market all the time, then you have to have a setup for each type of market condition, and recognise when market conditions change

Depending on the timeframe used, a stock can be in an uptrend on one, downtrend on another and range trading on yet another - so you may have to use timeframe analysis to decide if or not to take a trade.

If you find a setup that you have "faith" in - remember that the setup will occur across ALL timeframes - the higher the timeframe used - the easier it is to trade (less noise, giving clearer signals), the lower the timeframe, the more "expert" you have to be to make use of it.

If you can't make money trading say a weekly chart - then don't even consider trading a lower timeframe.
It takes a lot of experience to be consistently profitable using a daily chart (anyone telling you differently is only kidding themselves)

Indicators work, EW works, pattern trading works, etc etc. Don't be put off by other peoples opinions - they are only opinions - as is this post
At the end of the day, indicators, EW etc are just tools, in the hands of a good tradesman.............

There is nothing wrong in trading from say the monthly or weekly charts!! - there is serious money to be made there for comparitively less work , and it gives you a life outside of trading
When market conditions become more favourable, I'll probably include trading from the monthly or weekly charts, easy to trade. Trading from the longer term charts is a much more relaxed style of trading, but still offers a very good potential return!!!

Longer timeframe trading cuts the stress/excitement level drastically and allows you to refine your setups without undue stress
Once you have refined your setups and gained trading experience - consider trading a lower time frame, you will have the opportunity of more trades to choose from, which ultimately should result in a larger $ return each year.

For what its worth, -----
I use both indicators and price/volume/time analysis - and indicators play a major role.

For me, the most important aspect of trading, from a TA point of view - is understanding the various forms of Support/Resistance and the use of multi timeframes

Be your own man - do not take anything you read or hear as gospel - check it out first

Hope this helps

[sreenathc]

In this choppy market, I am finding that 'gap' trading seems to work....here is what I am using ....

1. If a stock Gap's up....wait for Stochastic Oscillator to show divergence at top with price action and buy PUTS...at least 2 months away!!. Sell when gap is filled

2. If a gap down happens....same thing but in reverse.

I am trading a maximum of 2000/trade...and am happy making about 200/trade every 4 or 5 days.

I don't know how long this 'lucky' string of success will continue, because I think this is more luck than my 'financial' genius :)

Cheers.

P.S...Does anybody use Refined Elliott Trader software....when Rich Swannell explained, it seemed so simple...and yet when I trade using that, I lost money every time!! The predictions keep changing for the stock on a daily basis...so, I have no idea what we are supposed to do.

[Trembling Hand]

Volume and time (as well as price obviously). Do yourself a big favour and throw the rest out.:horse:

[IFocus]

In this choppy market, I am finding that 'gap' trading seems to work....here is what I am using ....

1. If a stock Gap's up....wait for Stochastic Oscillator to show divergence at top with price action and buy PUTS...at least 2 months away!!. Sell when gap is filled

2. If a gap down happens....same thing but in reverse.

I am trading a maximum of 2000/trade...and am happy making about 200/trade every 4 or 5 days.

I don't know how long this 'lucky' string of success will continue, because I think this is more luck than my 'financial' genius :)

Cheers.

P.S...Does anybody use Refined Elliott Trader software....when Rich Swannell explained, it seemed so simple...and yet when I trade using that, I lost money every time!! The predictions keep changing for the stock on a daily basis...so, I have no idea what we are supposed to do.


Google Rich Swannell


http://www.trade2win.com/boards/software/12206-refined-elliott-trader.html

[Trembling Hand]

Also as a rule of thumbs, indicators lag price action. Why trade on old data? Can you base today's buying/selling on last week's data? Another problem with them is that they try to pick tops and bottoms (oscillators). You will get killed if the trend is strong (ie someting staying in oversold for months) or when its chopping (you get craploads of false breaks).
Learn to read price action, volume, few trendlines and maybe some other stuff. But imo, price based indicators as a group are a waste of time.


:iagree:

[baboon]

I use 10EMA and 30EMA on the daily charts. If both are moving upwards and price is above both averages I try to buy. I dont buy when the moving averages are moving downwards and price is below averages. Its only the way I do it, but might not work for anyone else. I try my best to get out even or with a small loss but doesnt always work. Need more practice.

If I watch the market intraday I use the 5-minute chart with 10EMA and 30EMA as well. I read this strategy in a book and I liked it so I try to stick with it.

[sreenathc]

Volume and time (as well as price obviously). Do yourself a big favour and throw the rest out.:horse:

How do you use volume & time....when I look at the charts in CommSec professional trader, the volume charts don't seem to show much (I must be reading them wrong!).....can you please elaborate a little bit?

Thanks,
Sreenath

[apra143]

If you de-emphasize the prediction part of your system (thus giving up your need to be in control and to be right), and concentrate on exits and position sizing, you should do quite well.

Any guess where the above is from :)

Focusing on trying to be right about the next move should be a minor concern apparently. Dunno how well it works in practice.

[beaul]

Can you give me a recommendation for a volume based indicator.
or a volume /time based indicator

[Trembling Hand]

Can you give me a recommendation ...............

....or a volume/time based indicator

Yes get a Massive volume of charts and see what info you can learn from them

&

Spend a Massive amount of time studying what context resulted in that info you learnt.

There's the only volume/time indicator that I can recommend.

[beaul]

thank you for your help

[Trembling Hand]

thank you for your help

No problems. Its not the shortcut to riches that you were after. But that is why this game is so good.

It rewards hard work, testing & time, thous that skip these steps pay for the fortunes that the few that don't accumulate.


So thanks to all the short-cutters for their help :p: :bigthumb::biglaugh::grinsking

[tech/a]

No problems. Its not the shortcut to riches that you were after. But that is why this game is so good.

It rewards hard work, testing & time, thous that skip these steps pay for the fortunes that the few that don't accumulate.


So thanks to all the short-cutters for their help :p: :bigthumb::biglaugh::grinsking

Dont know about that.

Its the outlier moves or Black Swans which contain both the potential for life changing rags to riches stories--as well as the reverse.

Nassim Taleb 's book of the same name is a great read.
http://en.wikipedia.org/wiki/Black_swan_theory

Sure the age old and proven tested methodologies returning positve expectancy will generate consistent profit (Until conditions fall well outside your tested data set)---but true life changing profit comes from outliers.
In Trading
Property
Business.


Focusing on trying to be right about the next move should be a minor concern apparently. Dunno how well it works in practice.

Placing yourself in "anticipation" of a move does work well as does taking yourself out of a position when the move either doesnt eventuate or is proven wrong.

[Trembling Hand]

Dont know about that.

Its the outlier moves or Black Swans which contain both the potential for life changing rags to riches stories--as well as the reverse.

Nassim Taleb 's book of the same name is a great read.
http://en.wikipedia.org/wiki/Black_swan_theory

Sure the age old and proven tested methodologies returning positve expectancy will generate consistent profit (Until conditions fall well outside your tested data set)---but true life changing profit comes from outliers.
In Trading
Property
Business.



Placing yourself in "anticipation" of a move does work well as does taking yourself out of a position when the move either doesnt eventuate or is proven wrong.

Oh please don't be such a muppet. Are you saying that "Placing yourself in anticipation of a move" requires what? A post on a forum asking every other get rich quicker what indicator do I use??

Or setting up a Business in anticipating of a life changing trend requires just opening the door in the morning? free from any commitment to actually doing the work?

[Trembling Hand]

Placing yourself in "anticipation" of a move does work well as does taking yourself out of a position when the move either doesnt eventuate or is proven wrong.

And just on that Tech how much time have you spent in your pursuit of the outliers?

In the anticipation and the ability to recognise change?

My guess your whole working adult life.

[nomore4s]

Dont know about that.

Its the outlier moves or Black Swans which contain both the potential for life changing rags to riches stories--as well as the reverse.

But the ones who regularly catch the outliers have normally done the hard work to put themselves in a position to make the most of the opportunities that come along.

Sure there is luck involved and sometimes a novice gets lucky but the majority of the time it is the people who have put in the hard work and have taken the risks that are rewarded.

[Boggo]

Can you give me a recommendation for a volume based indicator.
or a volume /time based indicator

Hi beaul.
In an attempt to give you a very basic indication of one potential direction to pursue in your quest I have attached below a simple setup that helps show me possible turning points if I am long or short.

The two below are actual examples (one short and one long) that gave me a heads up that a reversal may be possible = time to tighten stops

I use Metastock for this stuff and I have set up the 'Expert Advisor' to change the colour of the bars when this simple formula goes above 85 or below 25, green for "oversold" and yellow for "overbought"
Mov(RSI(9),5,S)

When the bar changes I simply look for a possible reversal of the position of the 3 day volume ema
Mov(OBV(),3,E)

If that is at or near an extreme and shows signs of reversing then I tighten up my stops.

The two opposite examples below, click either to expand.

[beaul]

Trembling Hand,
If you don't want to help people why don't you just say so.

[Boggo]

Trembling Hand,
If you don't want to help people why don't you just say so.

beaul, unfortunately for every person who tries to help you there will also be others who like to disrupt them, recognise them and ignore them.
Not sure why they even bother to comment really.

Example of a 'necessary' comment on a beginners thread :rolleyes:

Oh please don't be such a muppet

[Trembling Hand]

Trembling Hand,
If you don't want to help people why don't you just say so.

Oh sorry OBV(On balance Volume) is what you need. Works every time. (helpful???)

By the way. After you get swallowed up and spat out following all the back-fitted examples of indicators & TA & whatever is the latest best thing come back and tell me I'm full of sh!t and my post at #24 was not in hindsight helpful.

[Timmy]

Trembling Hand,
If you don't want to help people why don't you just say so.

Trembling Hand is one of the most helpful posters on ASF, IMO.
And he brings out the best in other helpful posters too.

[Trembling Hand]

beaul, unfortunately for every person who tries to help you there will also be others who like to disrupt them, recognise them and ignore them.
Not sure why they even bother to comment really.

Example of a 'necessary' comment on a beginners thread :rolleyes:

Oh please Boggo you have to be kidding. You have never posted a chart of a lossing trade!! How helpful is that??

Beginners love to be feed BS but sorry mate it doesn't help them. And you know very well that that Muppet comment is actually Techs response to EVERYONE and thats why I used it.

[tech/a]

Will reply later

[Boggo]

Oh please Boggo you have to be kidding. You have never posted a chart of a lossing trade!! How helpful is that??

Beginners love to be feed BS but sorry mate it doesn't help them. And you know very well that that Muppet comment is actually Techs response to EVERYONE and thats why I used it.

TH, I don't need to post my winning or losing trades,my system is there on both of those charts for all to see, green arrow is buy, red line is stop.

Your post #24 is excellent but then you ruin any credibility by having a go at tech/a.
Why don't you just send tech/a a pm when you get the urge to have a go at him rather effen up a thread where someone who has just joined this month is asking a simple question.

[Trembling Hand]

Your post #24 is excellent but then you ruin any credibility by having a go at tech/a.

Gee then Tech/a must have no credibility exactly matching mine. Cuz his the one who uses that comment like I said to everyone, both new and old posters.

[nunthewiser]

TH, I don't need to post my winning or losing trades,my system is there on both of those charts for all to see, green arrow is buy, red line is stop.

.


But your system examples posted is all in HINDSIGHT m8 .made to fit AFTER the fact......... i have mentioned this previously so will not question the merits or ask how this method of posting actually benefits anyone that trades in realtime.

Just my 2 cents not intending to create any angst or badwill.

[tech/a]

In the mean time those who are sick and tired of slaving countless hrs with disappointing results---- would be best advised to look into the PAREBO principle.

[nunthewiser]

In the mean time those who are sick and tired of slaving countless hrs with disappointing results---- would be best advised to look into the PAREBO principle.


I tend to use the KISS principle but that does not make as exciting reading.

[MRC & Co]

In the mean time those who are sick and tired of slaving countless hrs with disappointing results---- would be best advised to look into the PAREBO principle.

Pareto?

Anyways, welcome back. :)

[Boggo]

But your system examples posted is all in HINDSIGHT m8 .made to fit AFTER the fact......... i have mentioned this previously so will not question the merits or ask how this method of posting actually benefits anyone that trades in realtime.

Just my 2 cents not intending to create any angst or badwill.

Any chart ever posted is hindsight, if you can find otherwise I will buy it.

Nothing is made to fit on any of my charts nun, that is my default template in Metastock, open any chart and it is on there and my scan is exactly the same, it finds the charts where an arrow exists on the bar.

One stock scan result only on Fridays data, SMX. I only scan stocks that have a market cap of >= $30 mill.

[seasprite]

I tend to use the KISS principle but that does not make as exciting reading.

I use the PISS principle , drink lots of it , home brew mainly and then make a decision . If I can remember what company I was looking at , surely it must be good. Yeah welcome back Tech.

[tech/a]

Pareto?

Anyways, welcome back. :)

Yes sorry dyslexia

[Trembling Hand]

In the mean time those who are sick and tired of slaving countless hrs with disappointing results---- would be best advised to look into the PAREBO principle.

Don't see how that is going to be relevant. So only trade the top 20% of trades??

I've said to you before, if you can travel in time and tell me which ones are going to be my top 20% I will happily follow that rule. But since I cannot travel in time and a trade is not like a customer I don't see how that's possible?

[beaul]

Trembling Hand, what is your point about putting rubbish on newbees.

You do not know who i am or what experience i have had with the stock market.
We all know it is NOT that easy, what is your point.?

I was chairman of a publically listed company that I floated some years ago here in Australia before moving to California for ten years.
I have probably had more years of experience than you ever had, but
I am always willing to learn.
Get a life.

[Mr J]

Beaul, I'm not sure how being chairman of a publicly listed company makes you a good trader, and experience does not equate to skill anyway. TH is blunt and obviously offended you, and you have reacted in the way most people would - dismissing the point and focusing on the attitude.

[Trembling Hand]

Trembling Hand, what is your point about putting rubbish on newbees.

You do not know who i am or what experience i have had with the stock market.
We all know it is NOT that easy, what is your point.?:banghead:

You think I'm taking the p!ss but your ego is getting in the way of the message.



I was chairman of a publicly listed company that I floated some years ago here in Australia before moving to California for ten years.
I have probably had more years of experience than you ever had, but
I am always willing to learn. Maybe in floating a company off to shareholders but trading I would have a fair bet no you haven't. Just because you have listed a company will not make a canned indicator "work".

I still say that my post at #24 is actually, for you, the most helpful, practical, safest and likely to lead to success post in this thread.


Get a life.
:D

[nunthewiser]

Trembling Hand, what is your point about putting rubbish on newbees.

You do not know who i am or what experience i have had with the stock market.
We all know it is NOT that easy, what is your point.?

I was chairman of a publically listed company that I floated some years ago here in Australia before moving to California for ten years.
I have probably had more years of experience than you ever had, but
I am always willing to learn.
Get a life.


HE IS HELPING YOU

There is none so blind that cannot see .

During your time of being employed by bogans like me and other toothless shareholders did you ever actually trade stock ?

To learn is to listen.......... if not prepared to listen , dont learn........... simple really.

[Largesse]

this thread is funny

[nunthewiser]

this thread is funny

Get a life :D

[beaul]

Thank you guys, including you TH.
I love this forum.
It is good we can all have a bit of fun, while hopefully making money.

[seasprite]

I still say that my post at #24 is actually, for you, the most helpful, practical, safest and likely to lead to success post in this thread.


:D

yep . did that , burp. came up with
Time seems to be the most important indicator after drinking beers and since views are showing as 1618
0-67
67-86
86-194
194-235

194-86 = 108 which = 1.618 X 67
235-194= 41 which = 38.2X 108
0.618X 41 = 25
25+ 194 = 219

235 = 12 feb 2010 or there abouts for wave 5

[Whiskers]

yep . did that , burp. came up with
Time seems to be the most important indicator after drinking beers and since views are showing as 1618
0-67
67-86
86-194
194-235

194-86 = 108 which = 1.618 X 67
235-194= 41 which = 38.2X 108
0.618X 41 = 25
25+ 194 = 219 ]

:eek7:


235 = 12 feb 2010 or there abouts for wave 5

:iamwithst Sounds about right to me. sip sip.

Welcome back techa, we have dissagreed ocassionally but I respect you for being able to dissagree and carry on a conversation without excessive use of 'put downs' which can extend to 'cyber bullying'.

Take it easy TH... it's not good for the blood pressure. :p:... and why don't you at least respect the Beginners Lounge... take it a bit easy in here.

I'll post in the open threads later if you have some steam to let off. :D

PS: But seriously, I watch the MACD and Stochastic (among others), if for no other reason than that is what arguably most use or their system is at least partly based upon.

PPS: BUT, for discretionary trading I think the best 'tool/ indicator' is to master your own intuition.

[seasprite]

:eek7:



:iamwithst Sounds about right to me. sip sip.



sorry , was i suppose to include a chart as in potential breakouts, please use the one on dow analysis if need be , cheers.

[Wysiwyg]

PS: But seriously, I watch the MACD and Stochastic (among others), if for no other reason than that is what arguably most use or their system is at least partly based upon.

Interesting you should mention that because I was looking at CTA's (Commodity Trading Advisors) recently and noticed they use T.A. in their strategy . What I wondered was what indicators were most used. Probably top secret and beyond an internet search but would be interesting to know.


The models used employ several different approaches, including contrarian, momentum and trend following. In addition, the models result in different trade day durations, with short-term trades having an average trade duration of three days, medium-term trades having an average trade duration of 20 days, and long-term trades having an average trade duration of 100 days.
Longer-term trend models may have larger profit potential, but tend to be more volatility. Short-term model are used, in part, to attempt to reduce the overall volatility of the program and reduce drawdowns. The models generally have low correlations with each other raising the overall Sharpe of the combined portfolio. When a trading signal is generated, a trade is executed on or before the close or by the next day’s open.
another

It utilizes multiple momentum-based systems which incorporate price, time, volatility and pattern recognition into its dynamic models. These elements are combined to generate high probability directional trading signals, which attempt to capitalize on the many short-term trends that are present in most types of market environments.
and another

The model began trading U.S. markets in Nov 01 and in Sep 09 the model was applied to European and Asian equity indices. There are nine different alpha generating algorithms that generate trade direction and risk allocation. The model trades the DJ Euro Stoxx, DAX, Hang Seng, and Nikkei 225 (SIMEX) contracts for accounts greater than $1MM. Trades are short term, with new trade signals daily. The max leverage is 2:1. Trade signals are about 65% long and 35% short.
and another

Fully systematic pattern recognition program that captures short-term 1 to 2 day trend and counter trend movements. The STP program trades currencies, energies, indices, financials, metals, foods, grains, meats, wood and fibers both foreign and domestic futures markets.
and another

The general trading strategy is defined as "trend following". Most, but not all, trade initiations and liquidations are in the direction of a trend. The PAG program employs a number of trading models acting independently. Each model generates its own entry and exit signals and trades the long and short side of each market.

[tech/a]

Don't see how that is going to be relevant. So only trade the top 20% of trades??

I've said to you before, if you can travel in time and tell me which ones are going to be my top 20% I will happily follow that rule. But since I cannot travel in time and a trade is not like a customer I don't see how that's possible?

Most can't that's why I've been compelled to jump to the dark side and comment.
Nothing changes here---- pity some genuinely want to learn.
Following the herd mentality of 10000 hrs study will indeed qualify you as one very well read sheep.
Those who dare to question convention set themselves apart again will reply when I have more than an I phone to type on!

[nulla nulla]

I try to trade stocks that have Liquidity & Spread. I try to confirm entry and exit points using MACD charts and Relative Strength Charts but admit I am open to entry and exits when I determine spikes in interday activity. I am significantly less inclined to be drawn by dividends.

[Largesse]

spread?

[nunthewiser]

Uses volume and a good ole fashioned bar chart for position and swing trading

I have no use or need for any other indicators.

I also use fundamental data/research amongst other criteria before entering a position style trade.


Uses D.O.M/ C.O.S and intraday 5 min/1 min charts(including vols) for intraday trading

Like i said i like to K.I.S.S.

Now wasnt that a boring read compared to all the nobs and whistle indicator posts out there .

[nulla nulla]

spread?

Interday movement. if it doesn't have sufficient volume/liquidity to move a few % points through the day it isn't much good for trading as you coulld buy and have to hold as you wait for it to move one way or the other.

[Trembling Hand]

Those who dare to question convention set themselves apart

Indeed. I did some time ago when I stop chasing outliers like the toothless punter you see standing around a TAB all day or the dream chasers trading penny dreadfuls.

On another note after you ably your Pareto principle and only trade your good trades do you apply it again and only trade the 20% of the 20%. Then hell why not apply it again :confused:

[tech/a]

Indeed. I did some time ago when I stop chasing outliers like the toothless punter you see standing around a TAB all day or the dream chasers trading penny dreadfuls.

On another note after you ably your Pareto principle and only trade your good trades do you apply it again and only trade the 20% of the 20%. Then hell why not apply it again :confused:

I find it interesting that you are prepared to make so many assumptions prior to knowing the content of my contibution.

You are so predujiced in your view that you can only see one arguement (yours) which could be workable.

It appears that the only opinion worth following on this forum in your view is your own?

Regardless I will put mine up for those who want something out of conventional thinking.
Tommorow wheni have a computer

[waza1960]

Welcome back Tech.It would be great if yourself and TH and your egos could co-exist on this forum as I think you two are possibly the most valuable members we have here, knowledge and experience wise.I know the forum was not the same without you both.:D

[barney]

Indeed. I did some time ago when I stop chasing outliers like the toothless punter you see standing around a TAB all day or the dream chasers trading penny dreadfuls.



It appears that the only opinion worth following on this forum in your view is your own?

Regardless I will put mine up for those who want something out of conventional thinking.



Good to see both you guys back, and at it tooth and nail as expected :D

TH ..... much respect as you know ;) ..... totally understand your points ... I have been "learning" FX for quite a while now, and the concept of chasing big moves on either Index's or FX is, on most occasions, a fools game ..... which is what you are trying to warn the "un-convinced" punters of :rolleyes:

Tech, Chasing outliers (stocks) is certainly a viable quest, but if the market is sideways/down, those opportunities are often short/unreliable at best, I'm sure you agree ??

For me, the light bulb moment (trading forex) was when I started thinking (or trying to think) like a "smart money" trader .... ie doing almost exactly the opposite of everything the "text book" tells you !!

Trading index/fx you need to think like a smart money trader and either front run their lead, or back a retrace with a slightly wider stop (swinging, not scalping .... not a good scalper :rolleyes:) ...
trading stocks you need to understand the herd, and get out before the stampede is over........

just babbling on after a couple of ports, so disregard if I seem irrational :D

[Mr J]

I have been "learning" FX for quite a while now, and the concept of chasing big moves on either Index's or FX is, on most occasions, a fools game .....

It's only a fool's game for those that are fools. Opposite of the text book? Such as? I'm guessing you didn't mean that to be taken literally, otherwise I'd say that I don't want to be buying when the majority are selling.


It appears that the only opinion worth following on this forum in your view is your own?

No offense Tech, but you have been guilty of that.


Like i said i like to K.I.S.S.

Now wasnt that a boring read compared to all the nobs and whistle indicator posts out there .

Dom, fundamentals, 1min charts? That's fancy stuff Nun, I throw a line on a 4hr chart :p:.

[nunthewiser]

Dom, fundamentals, 1min charts? That's fancy stuff Nun, I throw a line on a 4hr chart :p:.

:D I was trying to impress ya :D

Various charts for various timeframes......no point looking at a weekly if ones trading ticks intraday in my view

[Timmy]

Re: Which two indicators would you use?

Right and left.
Sometimes simultaneously.
Sometimes even when I am turning.

[skc]

Re: Which two indicators would you use?

Right and left.
Sometimes simultaneously.
Sometimes even when I am turning.

Lol... in addition to right and left, I also regularly use:

- Stop and Reverse indicators. Red for stop, and white for reverse.
- MACD - Moving average consumption / distance. When this indicator hits zero I know that all momentum has been exhausted.

[nunthewiser]

Middle finger also works wonders in a pressurised situation

[Timmy]

Middle finger also works wonders in a pressurised situation

I find it works well as a guide to sentiment.

[tech/a]

10000 hrs and or 10000 charts wont guarentee success in any field.
But I put forward that it may well give you enough skill to survive in your chosen field of 10000 hrs of whatever it is your studying.

The field of view with regards to Outliers/Blackswans is indeed narrow on this thread if not the forum. Limited to penny stocks,an assumption which will soon become clear---is not my subject or intention.

Having 10000 hrs of experience wont insulate you from the unfortunate occurance of a negative Blackswan occurance or guarentee that you'll be on the end of a positive one.

But LIFE CHANGING occurances are often out of character events.
Sure long term planned events can also be life changing but for me and many I know Blackswan events have formed the world we (On a personal level) are in now in a few short years.

I'm no different to most here regardless of age.
I certainly was of the school ---"Result is equal to effort".
But when I look back on many life changing events particularly financial---results were and are very dis proportional to effort!

Often its a case of good fortune rather than good management. In my case it has been and could be seen as partially good management.

Some examples.

(1) At the time of developing techtrader I had no idea that it would be trading the next 7 yrs on absolute ideal conditions. $30K to $360K in that time.

(2) At around the same time I and others in my district began buying houses as we knew the new Southern Expressway was going to be constructed to our area. We/I had no idea that we were on the edge of the biggest Property boom ever.

(3) Currently.With the emergence of the GFC business looked under threat---un certainty. What I hadent considered was the government stimulas package and its affect on my business. with so much infrastructure now coming on line we have DOUBLED in size in the last 16 mths and still growing.

There are many hindsite examples.
Gold ---Radge was telling his clients to buy as far back as $375/ounce.
Oil --- few got the ride from $30-140.
AUD---Same for 55c to 98c
XAO index or SPI futures same for 6880 to 3200--- short. Yet I and many others closed all our long positions around the top of 6000 ish.


So some future possiblities.

(1) Short the DJIA using whatever vehical you want.Printing money can only lead to high inflation and the cycle goes on.
(2) Developement in property to satisfy a never ending demand.
(3) Liquidating assets to kill off debt as govt debt WILL give rise to inflation and increase in interest rates.
(4) Using that equity on freehold to build higher density housing and finally hold positively geared property which will keep abreast of inflation.

My point is.
ONE OUTLIER MOVE OR BLACKSWAN event can be life changing.
It only takes ONE.
Gold at $5 / .001c per ounce one contract from $375-1200 is serious money!--Life changing ---even a single Emini contract would be nothing to sneeze at.

You dont have to put yourself in a position of high risk.
You dont have to be a genius.

You do have to place yourself in a position where
(1) You avoid to the best of your abilities negative outlier moves.
(2) You place yourself in a position to take advantage of that Rare occurence and runs you over in the process.

I call it standing in front of Trains.
Nothing to do you'll note with Buying Penny stock---yet everything to do with buying Penny stock!

80/20 rule later but you'll note 20% of this thread has content and 80% is questionable.

[Trembling Hand]

I find it interesting that you are prepared to make so many assumptions prior to knowing the content of my contribution.

You are so prejudiced in your view that you can only see one argument (yours) which could be workable.

It appears that the only opinion worth following on this forum in your view is your own? Oh! quite the contrary Tech. I have asked you every time that you bring up the 20/80 rule exactly how I would go about it in trading. I think from memory this is the third time. And your response is that 80% of my/your/anyone's profit comes from 20% of trades/effort/customer etc. YES! I get it. But you still haven't offered any reply to the "application of a rule of thumb" phenomena.

To me it sounds like 1990's MBA gumph. I too have had my fair share of biz experience and have seen that phenomena appear time and time again.

BUT

what I also know is that the 80% pays the bills to turn the machine over to enable you to benefit from the 20% that make the real cream. In biz, trading, sport and property. Please refute that for me?


Dont know about that.

Its the outlier moves or Black Swans which contain both the potential for life changing rags to riches stories--as well as the reverse.

Sure the age old and proven tested methodologies returning positive expectancy will generate consistent profit (Until conditions fall well outside your tested data set)---but changing profit comes from outliers. In Trading
Property
Business.

Placing yourself in "anticipation" of a move does work well as does taking yourself out of a position when the move either doesnt eventuate or is proven wrong.


And just on that Tech how much time have you spent in your pursuit of the outliers?

In the anticipation and the ability to recognise change?

My guess your whole working adult life.

Oh by the by. just as an example of why you get the sh!t you get. You haven't answered this one yet. A tactic that you like to do. Drop a quick one stating that someone is wrong but never return to it once challenged.

looking forward to seeing the true light. :D

[tech/a]

Oh! quite the contrary Tech. I have asked you every time that you bring up the 20/80 rule exactly how I would go about it in trading. I think from memory this is the third time. And your response is that 80% of my/your/anyone's profit comes from 20% of trades/effort/customer etc. YES! I get it. But you still haven't offered any reply to the "application of a rule of thumb" phenomena.

To me it sounds like 1990's MBA gumph. I too have had my fair share of biz experience and have seen that phenomena appear time and time again.

BUT

what I also know is that the 80% pays the bills to turn the machine over to enable you to benefit from the 20% that make the real cream. In biz, trading, sport and property. Please refute that for me?

Understanding that 80% of your effort in any one persuit will more likely return 20% of the result you want,gives rise to the thought and practical process of persuing and putting into place more of those things that return the 80% of result.

As an example in business we dropped all projects under $7K so we complete a lot less projects--our average project price has gone from 12K now to $56K (8 yrs latrer).






Oh by the by. just as an example of why you get the sh!t you get. You haven't answered this one yet. A tactic that you like to do. Drop a quick one stating that someone is wrong but never return to it once challenged.

looking forward to seeing the true light. :D

Dont see it as Sh!t.

Pursuit of outliers hasnt been a conscious goal but the positioning of myself in line with possible opportunities which could result in outliers has become a more conscious endeavour.

[Trembling Hand]

10000 hrs and or 10000 charts wont guarantee success in any field. :banghead:
Tech just on that one. Sorry mate I think you need to do some real research as to what the 10,000 hrs are and ecatly what you are trying to refute. May I suggest something that's not on the populist best sellers list :rolleyes: and closer to actual research in the field. Start with the name K Anders Ericsson.

[tech/a]

:banghead:
Tech just on that one. Sorry mate I think you need to do some real research as to what the 10,000 hrs are and ecatly what you are trying to refute. May I suggest something that's not on the populist best sellers list :rolleyes: and closer to actual research in the field. Start with the name K Anders Ericsson.

Just on that issue.

100s can complete their degree in any field (their 10000 hrs) only a handful become brilliant in their field.
Same with apprenticeships---there are Carpenters then there are tradesmen.
You get the idea.

I'm using the 10000 hrs as a point of reference.
My apologies if not appropriate.--to you.
Have meetings till lunch

[Trembling Hand]

Pursuit of outliers hasnt been a conscious goal but the positioning of myself in line with possible opportunities which could result in outliers has become a more conscious endeavour.

? Which has taken you how long to arrive at? Both in actual skill to enable proper execution and experience to recognise any such situation?

Same old tactic. You have not refuted the point that you initially disagreed with me. You have offered nothing yet as to why, one can skip experience and go straight to outliers.



It rewards hard work, testing & time, thous that skip these steps pay for the fortunes that the few that don't accumulate.


Dont know about that.
Its the outlier moves or Black Swans which contain both the potential for life changing rags to riches stories--as well as the reverse.

:confused: still nothin'


Just on that issue.

100s can complete their degree in any field (their 10000 hrs) only a handful become brilliant in their field.
Same with apprenticeships---there are Carpenters then there are tradesmen.
You get the idea. But you don't. You canot use the 10,000 hours delipreative practise turned on its head to prove your point. lol.

[tech/a]

? Which has taken you how long to arrive at? Both in actual skill to enable proper execution and experience to recognise any such situation?

Same old tactic. You have not refuted the point that you initially disagreed with me. You have offered nothing yet as to why, one can skip experience and go straight to outliers.

More looked at it differently as a survival requirement rather than a guarentee of success.



:confused: still nothin'

But you don't. You canot use the 10,000 hours delipreative practise turned on its head to prove your point. lol.

My apologies.
I'll re word it then to extensive research and study.
Does that satisfy your requirement?

[Mr J]

As an example in business we dropped all projects under $7K so we complete a lot less projects--our average project price has gone from 12K now to $56K (8 yrs latrer).

It's harder to do this with trading since there is far less confidence in the level of profitability of any individual trade. Anyway, the only reason I can think of to pass on a profitable trade is if we already have too much of our capital in play. I want the bottom 20% as well as the top 20%, otherwise I'm leaving money on the table.

[tech/a]

It's harder to do this with trading since there is far less confidence in the level of profitability of any individual trade. Anyway, the only reason I can think of to pass on a profitable trade is if we already have too much of our capital in play. I want the bottom 20% as well as the top 20%, otherwise I'm leaving money on the table.

Valid point and one which T/H is alluding to.

I'm sure everyone who analyses their income find that it doesnt come in a steady flow unless your a PAYE employee.
Those that trade fulltime will also notice the 80/20 rule at work.
Diversification is easiest when trading (compared to most businesses) hence working toward better returns for less effort and or expenditure would be more achievable by experienced fulltime traders than most business/owners.
One of the many benefits of a trading business.

Even those not trading fulltime should be aware of how to implement the 80/20 rule into their trading.

[barney]

It's only a fool's game for those that are fools. Opposite of the text book? Such as? I'm guessing you didn't mean that to be taken literally, otherwise I'd say that I don't want to be buying when the majority are selling.




Gidday J,

Just to clarify my last nights babbling ….
Re chasing big moves being a fools game “on most occasions” …. It was just an expression to amplify a point that TH had taught me a while back, but in the context of this thread, I stand by the statement ….

A newer punter trying to extract the 1000 pip move out of the Eur/Usd will most likely give up his open profits 99% of the time, simply due to the cyclic nature of the instrument .. unless he is running really wide stops, in which case he’ll probably blow the account eventually anyway!

Much better to try and take a couple of 20 pip swings out of the sub moves of the 150 pip daily range, bank the profits, and sleep well at night (ok early morning ! :D) in my opinion, but everyone has a different agenda (and bank size) .......... occasionally the odd outlier profit will happen anyway, assuming more than one contract is being traded

With regard to doing the opposite of the text book ….. not sure if we are agreeing or disagreeing …. if you are reading text books which tell you to buy when everyone is selling, you are reading the right text books;)

Determining the extent of “everyone” is the difficult part … and that is true in all time frames from my humble experience ..........

Pretty sure we are actually thinking the same language, but when things get written down, distortion tends to set in and blur the edges …..

To keep the thread on track, my two indicators are:-

Sell pivot highs in a (longer time frame) downtrend
Buy pivot lows in a (longer time frame) uptrend

nothing magical about that, but it works a reasonable % of the time, with a couple of added filters :)

Cheers.

[nulla nulla]

I'm starting to think the two best indicators might be a dart board and tea leaves. There doesn't appear to be a lot of consistancy in the other indicators at the moment.

[satanoperca]

I like the KISS indicator as well.

But the best one I use for changing direction is the media.

When the media says that shares are running hot and the market is bullish, it is time to sell off longs and go short.

Also glance over MACD, Skols, RSI, ROC when looking at charts to see if any stands out. Can I rely on a indicator or all indicators, no.

It depends on market conditions and as mentioned before volume, time and price.

Love how threads quickly turn into ego trips of I'm right and your wrong.

Agrees with Nun, take charge of your own decisions and accept what they return.

Life is good, there is no black or white just shades of grey. Which shade are you?

Best trading to you all.

[weird]

Interesting ...

I have read Nassim Taleb's books, but also watched a Salem Abraham interview, which describes the same outliners, but with a different point of view and strategy.

I think I would like to have and think about both points of view, before deciding on one.

[nomore4s]

All off topic posts on Wysiwyg's theory have been moved to this thread

http://www.aussiestockforums.com/forums/showthread.php?p=529398#post529398

Let's try to get this thread back on topic now.

[Garpal Gumnut]

Yes sorry dyslexia

Welcome back.
You should write a book tech.
Muppets needs to be in the title.

gg

[KMW]

I'm another using the 10 EMA @ the 30 as well. Recomended on another site so I decided to try them. I'm a newb so still finding my way with TA. Have only just exited my first trade for a small profit, lesson was should have pulled the trigger for that exit a couple of days earlier when it signaled to get out.

[tunrida]

a ruler and a pencil - definately!

[Billyb]

I've been learning about indicators lately and have come to the following conclusions

Here's my views, which I write to collect my thoughts but also in the hope that someone else might find them food for thought... feel free to comment or shoot me down :

-They are a fancy way of expressing historical data. But you can see this data in it's raw, unmanipulated form anyway - it's called volume and price!
-If one uses and indicator, they are using it because they think it will increase their win %. But we know that win % has very little to do with profits, your overall trading system is far more important in determining this. So why put so much emphasis on indicators?
-Indicators obviously have their place, many people fit it into their trading systems and are profitable, but I think they have the potential to distract beginners from what's really important - price action and your trading system.
-Indicators get complicated because you need to adjust them and change them for different market conditions -trending, whipsawing etc. That's adding way too many variables to any system, and it's bloody hard. My life is stressful enough as it is, so I've decided to stop spending more time on learning indicators and get back to developing myself in the meatier stuff. If only there was more time :banghead:

[addison]

firstly, there should be some room for both tech and fundamental analysis in a traders trading philosophy, i guess above all it should be understood that trading is an intellectual game and stock picking or trading on tips is really gambling, second i think anyones trading system, culture, philosophy or style should be free to evolve, and fluctuate, as ones life, ones objectives, and the market circumstances change, presently im using a barchart, with a 9 or 5 ema, because its tight, and i want an indicator to react as fast as possible, im using this same setup over any timeframe too, and for signals am combining it with a simple idea of a couple of consecutive closes above or below the ema, checking also for higher highs and higher lows, but before im looking at this im drawing trendlines and support/resistance lines to identify trends, doing this from far out (1y, 2y, 5y chart) helps me to see if and when, and where, a trend change occurs which gives me an overall clue as to how i "think" the price will move, and thus how i should trade, price breaching trend lines is a sign either that im right (on a good thing), or that ive been wrong, and should close my trade to limit my losses, protecting capital is always very important, i like to think of trendlines as having the ability to "fence in" the price, and be better able to react, also i use a simple position size calculator to work out how many shares etc to purchase for each trade, so as to keep any loss (and we should assume weve made a mistake, until the price shows us otherwise) to a manageable minimum, hope this is useful :)

[Wysiwyg]

-They are a fancy way of expressing historical data. But you can see this data in it's raw, unmanipulated form anyway - it's called volume and price!
-If one uses and indicator, they are using it because they think it will increase their win %. Then volume and price have also indicated something, otherwise the entry is random.

[skc]

-If one uses and indicator, they are using it because they think it will increase their win %. But we know that win % has very little to do with profits, your overall trading system is far more important in determining this. So why put so much emphasis on indicators?

Are you kidding? Look at your profit equation and tell me win% has very little to do with profits? It is directly related to profit. As is avg win and avg loss. They are all as important as each other.

[Billyb]

Are you kidding? Look at your profit equation and tell me win% has very little to do with profits? It is directly related to profit. As is avg win and avg loss. They are all as important as each other.

I think you know what I mean. From my understanding, what is important is expectancy (which includes win %), yes I shouldn't say it has very little to do with profits, that was an overstatement - but my point remains that you can be inaccurate, and only win one-third of the time, and still be profitable. The point I was making is that searching for high win % (i.e looking for the right indicator to improve your win %) will not necessarily improve expectancy, and thus profitability. Thanks for pointing out my poor use of words which could be misleading, I would edit it but it wont let me.

[tech/a]

Billy
A combination of the two is the very best scenario.
High% win rate and high R/R
But your right you can be right far less than 51% of the time and be spectacularly profitable

[skc]

I think you know what I mean. From my understanding, what is important is expectancy (which includes win %), yes I shouldn't say it has very little to do with profits, that was an overstatement - but my point remains that you can be inaccurate, and only win one-third of the time, and still be profitable. The point I was making is that searching for high win % (i.e looking for the right indicator to improve your win %) will not necessarily improve expectancy, and thus profitability. Thanks for pointing out my poor use of words which could be misleading, I would edit it but it wont let me.

Thanks for clarifying for everyone.

I have seen people extrapolate "Win % isn't everything" to "Win % is not important"... so just wanted to make sure no one was going to be mis-led by your earlier wording.

For some systems it might be easier to work to improve win%, for others it might be avg win ratio that is easier to manipulate. They are the two main parameters to your profit so I wouldn't neglect either one of those.

[tech/a]

If I had to pick 2

It would be

GAPS
VOLUME.

Both show effort better than any other indicators in my view.