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Higher Edge within a Single Candlestick

  • #501
  • Sep 22, 2017 8:21am Sep 22, 2017 8:21am
Quoting CrucialPoint
{quote} https://www.forexfactory.com/showthr...ng#post8510827 I'm always open to new ideas. But not unless one can give me a highly objective counter-argument, my stance will remain until challenged.
you are a liar!

if someone tell you your ideas are bullshit and wrong, you hide yourself and run away. there are 99% people smarter then you, thats normal when you dont know math at basic level. so you wonder why you are often bad in your arguments, just learn math and all will get better.

but then writing you are open for new ideas and same time you cant correct your wrong ideas is big irony.
you are best example of big mouth - nothing behind.

the worst case with you, you react as a child and dont bring arguments. very stupid to discuss with you when you always come unarmed.
  • #502
  • Sep 22, 2017 8:31am Sep 22, 2017 8:31am
Quoting dukas_trader
{quote} in roulette each round is independent from round before! you cant calculate it this way. then you can also calculate how birds sing when you trink milk. its useless calculation when 2 things are not connected together. many did fall in this math problem.
I agree that I couldn't. Luckily, Einstein did...
k
  • #503
  • Sep 22, 2017 8:33am Sep 22, 2017 8:33am
Quoting CrucialPoint
{quote} https://www.forexfactory.com/showthr...ng#post8510827 I'm always open to new ideas. But not unless one can give me a highly objective counter-argument, my stance will remain until challenged.
I`ve read it about a year ago, simultaneously I was learning about market sessions and was amazed by their affect on the markets...
So your post seemed to me like the same statement as - Apples fall down. I mean why would I ignore time if just recently I saw a holy grail in it?
This cognitive bias has cost me lots of wasted months...
However now, after playing around with price recording methods which don`t care about time I see what you`ve meant.
It`s just that traders are biased to the point that they simply wouldn`t manage to comprehend something without understand the logic behind in the first place.
I guess that`s why you share alot of things easily, since you know that most would simply never see what you see on the same pictures.
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The truth is hidden from you
  • #504
  • Sep 22, 2017 9:08am Sep 22, 2017 9:08am
Quoting CrucialPoint
{quote} No one is handing over the Goose??? That's not fucking good enough...
Thats because you need to take your backpack off first and stop chasing them all. Put some effort into it bro!

Nice seeing you around buddy.
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  • #505
  • Sep 22, 2017 9:18am Sep 22, 2017 9:18am
Like there is no past and future, there is no edge when it comes to predicting what the market will do next.

We simply put in a trade and the market, like some supernatural force, decides whether to taketh or giventh at a whim.

That's about it. There's nothing statistical about it. People who use statistics are at the mercy of the past (which doesn't exist anymore) which has absolutely no connection to the moment you make that trade. It's the same with indicators which are in fact a tool of statistics.

There are traders who win and lose. That's precisely why there is no such thing as a statistical edge that everyone can use. It's like quantum mechanics, once you try measuring an atom's momentum, you suddenly don't know where it is now.

Now, with a robust money and risk management practices... that's a whole another ballpark. That's where the "statistical" edge is. ;-)
  • #506
  • Sep 22, 2017 9:33am Sep 22, 2017 9:33am
Quoting MaxenshteinD
{quote} I`ve read it about a year ago, simultaneously I was learning about market sessions and was amazed by their affect on the markets... So your post seemed to me like the same statement as - Apples fall down. I mean why would I ignore time if just recently I saw a holy grail in it? This cognitive bias has cost me lots of wasted months... However now, after playing around with price recording methods which don`t care about time I see what you`ve meant. It`s just that traders are biased to the point that they simply wouldn`t manage to comprehend...
yeah renko left candlestick right, yeah renko depicts price better than candlesticks, because it follows price move irrelevant of timeclock/timeframe yeah i know that cause i been using those charts for the past 4 years, now the question is yeah we may see everything clearer on those non timeframe based charts but what or where is the edge that it gives us in trading ??[/quote]
Quoting MaxenshteinD
{quote} However now, after playing around with price recording methods which don`t care about time I see what you`ve meant.
what is it that you saw ? could it be seen also on candlesticks ?
  • #507
  • Sep 22, 2017 9:37am Sep 22, 2017 9:37am
Quoting raklian
Like there is no past and future, there is no edge when it comes to predicting what the market will do next. We simply put in a trade and the market, like some supernatural force, decides whether to taketh or giventh at a whim. That's about it. There's nothing statistical about it. People who use statistics are at the mercy of the past (which doesn't exist anymore) which has absolutely no connection to the moment you make that trade. It's the same with indicators which are in fact a tool of statistics. There are traders who win and lose. That's...
its not so random.
you can calculate a lot, dont hear for some math beginners like crucialpoint with his definition of edge, ofcourse this is stupid and complete useless.
you need a complete system with entry, managing and exiting trades (best with fundamental data inside), then ofcourse can you have extrem 10:1 and more win:drawdown over a period of 1 year and more for many many years until the market will change extrem.

ofcourse you come to some volume problems over the years and need to add other systems and markets, because going out is more important then going in, and with extrem amount in one currency (or only correlated currencies) the risk for kick your account out of the game is very high in an extreme news.
  • #508
  • Sep 22, 2017 9:46am Sep 22, 2017 9:46am
Quoting MaxenshteinD
{quote} {image}
alsowhat do those lines mean ??i believe the two horizontal lines are showing some kind of breakout or at least the beginning of two trends ? kind of a line in the sand. am i right so far ? can you please tell a little bit what those lines are hinting at Max ? thanks.
  • #509
  • Sep 22, 2017 9:49am Sep 22, 2017 9:49am
Quoting Pipalicious
{quote} Thats because you need to take your backpack off first and stop chasing them all. Put some effort into it bro! Nice seeing you around buddy. {image}
That gif is the most hilarious and accurate depiction of how most people try to trend trade.
  • #510
  • Sep 22, 2017 10:04am Sep 22, 2017 10:04am
Quoting dukas_trader
{quote} its not so random. you can calculate a lot, dont hear for some math beginners like crucialpoint with his definition of edge, ofcourse this is stupid and complete useless. you need a complete system with entry, managing and exiting trades (best with fundamental data inside), then ofcourse can you have extrem 10:1 and more win:drawdown over a period of 1 year and more for many many years until the market will change extrem. ofcourse you come to some volume problems over the years and need to add other systems and markets, because going out...
I agree with most of what you said but my point has nothing to do whether the market is random or not. Even if there is a strong trend, the next price tick has nothing, absolutely nothing, to do with the price ticks that occurred earlier in the trend. The next tick is wholly dependent on the buying or selling by market participants with motives that are completely obscure to the rest of us. Trying to make a surefire connection between two different price ticks is a path towards committing many fallacies in one's thinking. That's the kind of logic I want to impart to everyone in here so that we can trade wisely.

There are no guarantees except that risk and money management is within your complete control (the market can't even touch it), is what I wanted to say.
  • #511
  • Sep 22, 2017 10:26am Sep 22, 2017 10:26am
Quoting raklian
{quote} I agree with most of what you said but my point has nothing to do whether the market is random or not. Even if there is a strong trend, the next price tick has nothing, absolutely nothing, to do with the price ticks that occurred earlier in the trend. The next tick is wholly dependent on the buying or selling by market participants with motives that are completely obscure to the rest of us. Trying to make a surefire connection between two different price ticks is a path towards committing many fallacies in one's thinking. That's the kind...
because you can manage your losses you can manage your drawdown. and by calculating all what you trade against the drawdown, you manage your risk perfect.
there is no guarantee but i do it now near 20 years without problems.
  • #512
  • Sep 22, 2017 10:34am Sep 22, 2017 10:34am
Quoting metta87
{quote} alsowhat do those lines mean ??i believe the two horizontal lines are showing some kind of breakout or at least the beginning of two trends ? kind of a line in the sand. am i right so far ? can you please tell a little bit what those lines are hinting at Max ? thanks.
Each chart shows two completed days on one of the forex majors.
The vertical line separates them time wise, and the horizontal line just shows each days opening price.
My main problem with the time based charts which were solved by renko can be seen on this example.
As you can see price movement through out each day resembled something like:
----/\
---/
\/
If you look at the time based chart on the right, you will notice huge single candles with spikes.
Now those spikes were either a) a start of the major trend through out the day, or b) trends themselves.
I rely on basic dow theory like swing analysis (higher high.. higher low...)
And The time based charts made me sit through whipsawing consolidation period of low liquidity, and then miss the actual trends just because the time based candles filtered out all the pull backs out of the picture.

By the way, started out gambling on binary options.
Moved on to forex due to no time constraints.
Zero regrets LOL
Its already hard to catch which direction the movement will go,
But topping that with catching the exact/approximately close time is madness...
The truth is hidden from you
  • #513
  • Sep 22, 2017 11:10am Sep 22, 2017 11:10am
Quoting MaxenshteinD
{quote} Each chart shows two completed days on one of the forex majors. The vertical line separates them time wise, and the horizontal line just shows each days opening price. My main problem with the time based charts which were solved by renko can be seen on this example. As you can see price movement through out each day resembled something like: ----/\ ---/ \/ If you look at the time based chart on the right, you will notice huge single candles with spikes. Now those spikes were either a) a start of the major trend through out the day, or b)...
oh ok i now get what those lines meant thanks. so basically you spot those trends/ beginning of trends better on renko than on candlesticks, and enter on the pullback of those trends ?
Quoting MaxenshteinD
{quote} By the way, started out gambling on binary options. Moved on to forex due to no time constraints. Zero regrets LOL Its already hard to catch which direction the movement will go, But topping that with catching the exact/approximately close time is madness...
i completely agree with this, the time factor is a killer
  • #514
  • Sep 22, 2017 12:05pm Sep 22, 2017 12:05pm
Quoting MaxenshteinD
And The time based charts made me sit through whipsawing consolidation period of low liquidity, and then miss the actual trends just because the time based candles filtered out all the pull backs out of the picture.
Price everywhere is the same .... tops and bottoms happens at the same time and levels .... there is no big difference for me
Put zig-zag on "normal" chart and result is the same... if consolidation takes two hours on second chart on first within two hours nothing happened ... first is lying you about momentum .. i guess
But if it suits you, use what works for you...
  • #515
  • Sep 22, 2017 12:26pm Sep 22, 2017 12:26pm
Quoting VincentGallo
{quote} That gif is the most hilarious and accurate depiction of how most people try to trend trade.
Yes indeed (well i found it funny anyways), but knowing when to cut or let it run is the difference. Cliché? Or else you end up like this.
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  • #516
  • Edited 1:33pm Sep 22, 2017 12:52pm | Edited 1:33pm
Giovanni Maiani developed a program, reporting his results in Stocks & Commodities Magazine in November 2002. He reports analyzing 575 American stocks over a period of 15 - 20 years. He found more than 6.14 million candlestick formations. In his words:
"The most reliable, long lower shadow, is present 1.9% of time, and anticipates a declining session 49.12% of time; a rising session 40.61% of time. For traders who are quantitatively based, candlestick patterns are not terribly useful"- Giovanni Maiani

"But going back to the frequency of occurrences, how much can you benefit from a candlestick pattern that, although correct 68% of the time, has only occurred 102 times in 6.14 million sessions? You would get an accurate buy signal 0.001% of the time, or 69 times in 20 years of trading!"- Giovanni Maiani

Subsequently, Robert Colby, writing in SFO Magazine, Aug., 1996, found "No Major edge for Candlesticks". Further, he states: "Nevertheless, the candlestick patterns tested here failed to beat the simplest trend-following standard of comparison on a significant basis."

Steve Nison, the creator of Candlesticks, responded (S&C Jan 2003, p74) that Candlesticks are "A tool, not a system", and that you need to know the trend to use them.

An Aside on Technical Analysis:
In the Japanese Candlesticks technical method, the basic element is a cylinder with open and close as cylinder limits; with the high and low spiking above and below the open/close base. It is well known and consistently observed in profiles that the high and low prices are rejected quickly by the market. So it appears that candlesticks are giving most weight to prices the market quickly rejects. Consequently, it is no surprise that Maiani found candlesticks to be of little use for trading decisions. Candlesticks and other charts do have the value of offering a panoramic view of market history. While of little use for current, day-to-day trading decisions, a general view of one's market is worthwhile for understanding a market in general.
-Jones


Working Money: How Reliable Are Candlesticks? by Giovanni Maiani
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File Type: pdf Working Money How Reliable Are Candlesticks by Giovanni Maiani.pdf   46 KB | 829 downloads

https://www.forexfactory.com/showthr...85#post8662185

EDIT:
For those concerned with semantics :
Steve Nison first person to reveal candlestick charts to the Western world......., responded (S&C Jan 2003, p74) that Candlesticks are "A tool, not a system", and that you need to know the trend to use them.
Markets are not efficient, rather they are effective - Jones
  • #517
  • Sep 22, 2017 1:08pm Sep 22, 2017 1:08pm
Quoting mzvega
Giovanni Maiani developed a program, reporting his results in Stocks & Commodities Magazine in November 2002. He reports analyzing 575 American stocks over a period of 15 - 20 years. He found more than 6.14 million candlestick formations. In his words: "The most reliable, long lower shadow, is present 1.9% of time, and anticipates a declining session 49.12% of time; a rising session 40.61% of time. For traders who are quantitatively based, candlestick patterns are not terribly useful"- Giovanni Maiani "But going back to the frequency of occurrences,...
Nison didn't create candles.
  • #518
  • Sep 22, 2017 1:33pm Sep 22, 2017 1:33pm
Quoting metta87
{quote} oh ok i now get what those lines meant thanks. so basically you spot those trends/ beginning of trends better on renko than on candlesticks, and enter on the pullback of those trends ? {quote} i completely agree with this, the time factor is a killer
Kind off... but the best thing I ever found Is P&F, as a matter of fact I believe nearly all of the most popular technical analysis techniques were ripped of from it back in the middle of the 20th century.
The truth is hidden from you
  • #519
  • Sep 22, 2017 1:37pm Sep 22, 2017 1:37pm
amazing how easily people get lost with "theory" over and over again wow
  • #520
  • Edited 2:58pm Sep 22, 2017 2:35pm | Edited 2:58pm
Basically I think the edge within a single candlestick is to understand that it is working like math, but you can't apply math on it.

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