There's just something about the war between price and indicators that make me chuckle xD
But in all seriousness I do have a question that I'm sure the better minds of FF can figure out better than I.
It's been said that indicators are useless because they are based on price and price is the only true indicator you need. Don't get me wrong, this statement is 100% true.
But it's also agrued that price is its own right is lagging. To determine a trend (or range), a certain amount of bars have to go by. We must look to the past to see where we are in the present. The same goes with S/R levels, fibs, trendlines, double tops/bottoms, heads and shoulders, triangle consolidations, etc.
If a 48 period moving average on a five minute chart gives us the an average of the 48 bars (or the four hour equivalent on five minute chart), then we can see slope. There are many people who use an EMA slope as trend direction. The catch is that they use 48 bars in order to find the trend.
Price action traders look back maybe 10 bars, maybe 48, maybe more to see where the market direction points with the assistance of trendlines, channels or even Jacko's infamous "give it to a five year old" technique (which uses the whole chart which on my screen is in the ballpark of maybe 100 bars)
Another arguement in favor of indicators is... well... "indicators are based on price". Let me explain.
Indicators are not the raw data but ARE based on it. The advantage is that they show data in a way that we would not see it without indicators.
Don't get me wrong, I don't believe in Stochs or any kind of oscillating indicator that reduces the market to basically an up and down motion. Essentially, it's a sine wave.
But trend following indicators or trend strength indicators or market volatility indicators? Why not. They're based on price the same way S/R levels, fibs, trendlines, double tops/bottoms, heads and shoulders, triangle consolidations, etc. are. Past price to be exact :]
The only way to trade price action without past price is really just trading immediate patterns like pin bars or inside/outside bars. Even then you need another bar to confirm a pin bar and inside/outside bars require another bar in the past.
But now I'm just being a nitpicky asshole
Maybe there's a way to just trade the exact present? No past price needed. CrucialPoint found that way and I'm on the search for it as well. (Anyone got insight on this? xD)
So!
Let's hear it from you, the FF community.
Indicators based on the past price, Price action trading also based on past price, or trading without past price?
But in all seriousness I do have a question that I'm sure the better minds of FF can figure out better than I.
It's been said that indicators are useless because they are based on price and price is the only true indicator you need. Don't get me wrong, this statement is 100% true.
But it's also agrued that price is its own right is lagging. To determine a trend (or range), a certain amount of bars have to go by. We must look to the past to see where we are in the present. The same goes with S/R levels, fibs, trendlines, double tops/bottoms, heads and shoulders, triangle consolidations, etc.
If a 48 period moving average on a five minute chart gives us the an average of the 48 bars (or the four hour equivalent on five minute chart), then we can see slope. There are many people who use an EMA slope as trend direction. The catch is that they use 48 bars in order to find the trend.
Price action traders look back maybe 10 bars, maybe 48, maybe more to see where the market direction points with the assistance of trendlines, channels or even Jacko's infamous "give it to a five year old" technique (which uses the whole chart which on my screen is in the ballpark of maybe 100 bars)
Another arguement in favor of indicators is... well... "indicators are based on price". Let me explain.
Indicators are not the raw data but ARE based on it. The advantage is that they show data in a way that we would not see it without indicators.
Don't get me wrong, I don't believe in Stochs or any kind of oscillating indicator that reduces the market to basically an up and down motion. Essentially, it's a sine wave.
But trend following indicators or trend strength indicators or market volatility indicators? Why not. They're based on price the same way S/R levels, fibs, trendlines, double tops/bottoms, heads and shoulders, triangle consolidations, etc. are. Past price to be exact :]
The only way to trade price action without past price is really just trading immediate patterns like pin bars or inside/outside bars. Even then you need another bar to confirm a pin bar and inside/outside bars require another bar in the past.
But now I'm just being a nitpicky asshole
Maybe there's a way to just trade the exact present? No past price needed. CrucialPoint found that way and I'm on the search for it as well. (Anyone got insight on this? xD)
So!
Let's hear it from you, the FF community.
Indicators based on the past price, Price action trading also based on past price, or trading without past price?