Why are we afraid of simplicity? | Forex Factory

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Why are we afraid of simplicity?

  • #1
  • First Post: Sep 28, 2006 1:58am Sep 28, 2006 1:58am
Hi all!

Having witnessed a few weeks and months of the factory at work I've come to wonder....why do people need things to be complicated? Vegas and James16 have made it clear to me that you can have a strategy as simple as "enter and exit on slope change, take profit at fibs" and turn out thousands, and I mean this is literally, thousands of pips of profit.
Compare to systems with stochs, MAs, RSI, bollinger bands and sometimes - and I know this from my own experience - even all at once.
You end up looking for 2,3,4,5 confirmations and when finally all indicators line up - 90% of the move seems to already be over. Well, at least it feels like it.

So if the simple stuff works - and this is being proven daily on the PF and by traders like Vegas, Diallist, James16 and many others here on the factor - then why do we strive to keep on inventing new ways of combining indicators and learning new rules and rulesets, if the most simple of systems are proven and work?
Is there maybe some subconscious urge at work here, refusing to let us make money with too simple a system, not being able to say you mastered something as there really isn't much to master other than consistently applying a most basic logic?
Is it a lack of achievement or the conviction that one doesn't deserve something so simple?
Why, why do we strive for constantly new (and potentially complicated or just plain different) systems when we have perfectly functional and profitable ones at our disposal?
Why bother with others?
Greed in the form of trying to achieve just that little bit more profit by finding the "ultimate" system no matter how complicated or exotic it might be is just another vice in the life of a trader, lost in a state of perpetual searching instead of being set on a path and travelling with a set destination.

So, what are we waiting for?
What are we looking for that isn't there already?

Something to think about, something I've been thinking about.

SeekingLight
Trust price. Know yourself.
  • #2
  • Sep 28, 2006 2:18am Sep 28, 2006 2:18am
It's that futile search for the Grail.

If you need to look for it, you really have no idea what it is.

Great post SeekingLight. Spot on!

best,


Quoting SeekingLight
Hi all!

Having witnessed a few weeks and months of the factory at work I've come to wonder....why do people need things to be complicated? Vegas and James16 have made it clear to me that you can have a strategy as simple as "enter and exit on slope change, take profit at fibs" and turn out thousands, and I mean this is literally, thousands of pips of profit.
Compare to systems with stochs, MAs, RSI, bollinger bands and sometimes - and I know this from my own experience - even all at once.
You end up looking for 2,3,4,5 confirmations and when finally all indicators line up - 90% of the move seems to already be over. Well, at least it feels like it.

So if the simple stuff works - and this is being proven daily on the PF and by traders like Vegas, Diallist, James16 and many others here on the factor - then why do we strive to keep on inventing new ways of combining indicators and learning new rules and rulesets, if the most simple of systems are proven and work?
Is there maybe some subconscious urge at work here, refusing to let us make money with too simple a system, not being able to say you mastered something as there really isn't much to master other than consistently applying a most basic logic?
Is it a lack of achievement or the conviction that one doesn't deserve something so simple?
Why, why do we strive for constantly new (and potentially complicated or just plain different) systems when we have perfectly functional and profitable ones at our disposal?
Why bother with others?
Greed in the form of trying to achieve just that little bit more profit by finding the "ultimate" system no matter how complicated or exotic it might be is just another vice in the life of a trader, lost in a state of perpetual searching instead of being set on a path and travelling with a set destination.

So, what are we waiting for?
What are we looking for that isn't there already?

Something to think about, something I've been thinking about.

SeekingLight
  • #3
  • Sep 28, 2006 2:33am Sep 28, 2006 2:33am
Hi,

Why are we afraid of simplicity ?

Well it's because we like to fool ourselves that since we
are educated, complex individuals then simple answers
won't suffice. Simple answers for simple people.
I see it all the time, people kidding themselves,
You are your own worst enemy- fact!!!.
Ps - I am, by nature an optimist, my glass is half full.
  • #4
  • Sep 28, 2006 2:51am Sep 28, 2006 2:51am
Hello,

As a newbie to forex here's my take.

Forex trading is not an exact science; there is a fair amount of discretion and "feel" involved and in some ways it's tantamount to art. That said, I think the reason many of us look for more complex methods, or additional indicators or whatnot, has to do with our need to approach certainty. More automation, more confirmatory signs, and more consensus amongst the myriad of systems out there will ultimately lead us to a discretion-free, foolproof system, we like to think - while knowing that's not true. What this leads to in excess, on the other hand, is information overload and an overall dilution in the effectiveness of all the systems.
  • #5
  • Sep 28, 2006 5:40am Sep 28, 2006 5:40am
Quoting SeekingLight
Hi all!

Having witnessed a few weeks and months of the factory at work I've come to wonder....why do people need things to be complicated? Vegas and James16 have made it clear to me that you can have a strategy as simple as "enter and exit on slope change, take profit at fibs" and turn out thousands, and I mean this is literally, thousands of pips of profit.
Compare to systems with stochs, MAs, RSI, bollinger bands and sometimes - and I know this from my own experience - even all at once.
You end up looking for 2,3,4,5 confirmations and when finally all indicators line up - 90% of the move seems to already be over. Well, at least it feels like it.

So if the simple stuff works - and this is being proven daily on the PF and by traders like Vegas, Diallist, James16 and many others here on the factor - then why do we strive to keep on inventing new ways of combining indicators and learning new rules and rulesets, if the most simple of systems are proven and work?
Is there maybe some subconscious urge at work here, refusing to let us make money with too simple a system, not being able to say you mastered something as there really isn't much to master other than consistently applying a most basic logic?
Is it a lack of achievement or the conviction that one doesn't deserve something so simple?
Why, why do we strive for constantly new (and potentially complicated or just plain different) systems when we have perfectly functional and profitable ones at our disposal?
Why bother with others?
Greed in the form of trying to achieve just that little bit more profit by finding the "ultimate" system no matter how complicated or exotic it might be is just another vice in the life of a trader, lost in a state of perpetual searching instead of being set on a path and travelling with a set destination.

So, what are we waiting for?
What are we looking for that isn't there already?

Something to think about, something I've been thinking about.

SeekingLight
SL..what a great post! I have been trading for over 10 years and have only had a consistent profitable system for the last 2 years. I used to be an indicator junkie..AROON, TRIX, MA's, Stochs, BB..you name it, it was on my chart. In hindsight much of this was to make me feel like I was "doing something" and most of it was for "comfort". It also helped me get away from the stark truth that trading can be extremely, excruciatingly..BORING! Despite what many seem to believe, the mechanical process of waiting for a set up, placing your entry and managing your exit is not alays the most glamarous task in the world.

For the record, my consistently successful system is based on PRICE only. From time to time I may throw in non-lagging CCI..but even that is rare these days. I use good MM and every trade has at least 1:2 RR. At the end of the day, price will always be the best indicator. Just my 2 cents.
  • #6
  • Sep 28, 2006 8:22am Sep 28, 2006 8:22am
SeekingLight,

Your post is well conveyed. The fact is there is nothing wrong with those complicated indicators or strategies, it is our own society and environment make us think that whatever good system is shown it must come with some good goodie. Hence any newbie who is looking for good strategy, ask him/her what criteria is the good system? you will know what I mean.
  • #7
  • Sep 28, 2006 11:45am Sep 28, 2006 11:45am
In agreement w/all the good posts above on Price being king. . . and though i know, realy know, that this is true, i still have my cloths on and have yet to truely trade naked. I'm trying to do work in some changes to my charts/style, time will tell as to when i'm able to make the transition profitably.

I also know this, that without the comradery and great interaction here at the factory i'd surely be lost without a compass. The search for the perfect indicator will hopefully shed some light on the market in ways one might not have thought of if simply trading of bars/candles, at least for me it has. I remember situations where i would come accross a new-to-me indicator, say the CCI at the time. I'd study that indicator till the light bulb went on and figured out what price was doing in the candles against the median ma. Then i'd jettison the CCI, but the MA remained. Maybe someday even the last MA will vanish off the chart? I think that is one way to simplify things. Learn what an indicator such as our MACD,RSI,Stoch,CCI etc do, and learn the price pattern/behavior that corresponds to the indicator, then go back to price without the indicator...but i suppose for some ppls learning style this would be more complicated than actually having the indicator?

Just rambling on a day off.
: ) Thom


: ) Thom
  • #8
  • Sep 28, 2006 12:01pm Sep 28, 2006 12:01pm
I second that seekinglight. Simplicity rules. I make a very nice living just trading simple channel breakouts with moving avs and exiting using fibs and pivots. Simplicity itself and it works! Great post!
  • #9
  • Sep 28, 2006 12:15pm Sep 28, 2006 12:15pm
Trading using the simplest method is the best. The more we like and the more we understand the method will equal to success. but with proper money management.

I have been trading demo and live for six months now. I like to trade using key point or trendlines rather using indicators. I don't like to use indicators because it is not accurate. But none of our trading method is perfect right? Different people like different method.

Happy trading. May the pips be with you all the times.

Qu|cksilver
"Invest With The Insiders, Not The Masses" George Muzea
  • #10
  • Sep 28, 2006 12:18pm Sep 28, 2006 12:18pm
I love simplicity. trendlines/support/resistance, a few fibs, and channels/breakouts are all anyone really needs. I do however like a couple indicators which are used for divergence, but that's about it.
  • #11
  • Sep 28, 2006 12:24pm Sep 28, 2006 12:24pm
  •  Carlos
  • | Joined Sep 2005 | Status: Commitment, planning and discipline | 65 Posts
It took me a couple of years to work out that simplicity is best... when i first started trading fx.. i was paying thousands $ per year in software.. pronetanlytics, Acetrader, Nostradamus indicator, TradeStation charts and a news service.. this all cost me about £500 a month and it did me nothing.

I was even looking at the place and time that FX options would expire to see if this would add confluence to my trading ideas. What a load of rubbish, trash, junk, crap and all the rest. Now i have a couple of simple systems which over time destroy the market. I think to myself, "why the heck couldn't i have done this when i started trading a few years back". Hindsite is a beautiful thing!

All the experts, my mentors etc told me KISS.. keep it sweet and simple. I just almost wanted to keep it complex so that it was an academic challenge to myself.

If only i could rewind and just start making money then rather than going through that slow self discovery... perhaps we all do it that way.. perhaps we don't!

Simplicity RULES.. pick some technical principles u have heard work from individuals in this forum, then design and TEST a system. Once u have tested it u will have the confidence to trade it through adverse periods, knowing that in the long run u will be a winner. BUT remember don't go down the road of loads of indicators, changing all the settings to curve fit the data, only that when it is traded on out of sample data it will be SMASHED, KILLED, TRASHED.

Happy trading http://www.forexfactory.com/forexfor...cons/icon6.gif
  • #12
  • Sep 28, 2006 12:30pm Sep 28, 2006 12:30pm
Quoting Carlos
It took me a couple of years to work out that simplicity is best... when i first started trading fx.. i was paying thousands $ per year in software.. pronetanlytics, Acetrader, Nostradamus indicator, TradeStation charts and a news service.. this all cost me about £500 a month and it did me nothing.

Happy trading http://www.forexfactory.com/forexfor...cons/icon6.gif
Nostradamus indicator? Never heard of that one!
  • #13
  • Sep 28, 2006 12:36pm Sep 28, 2006 12:36pm
Seekinglight.....you hit it.....I call this phenominon....The Greener Grass syndrome, no matter what it is people think the grass is always greener on the other side of the fence.....just out of reach
Same Whore .... Different Dress
  • #14
  • Sep 28, 2006 1:16pm Sep 28, 2006 1:16pm
Hi Guys,


Yes, is very easy !

Its so easy that people that own and inveted the system that make you rich with a simple slope change, or something else, have to SELL their signals..

I don't know you, but if I had a mechanical system which makes me rich like counting 1 + 1 = 2, I wouldnt need to sell anything.
i would just be busy to have as many computers as possible up and working and leave them working with my system and make money

the forex machine has to keep his sponsor : making money with forex is very easy. is just behind the door. Its up to you if you want to become rich like us !

But i agree with the fact that having a christmas tree with 100 indicators on your graph has no sense.
the instict, some compasses, and MM are the best way to make it 'less difficult', but NEVER EASY...

i think that if you are smart enought, one day you will understand that best way to make money with forex is to stay behind the scene, like selling signals, making a forex web page and have sponsors, make some trading trainings etc..
Its more easy, less stressful, NO RISK, and even funny

good trades with easy systems
  • #15
  • Sep 28, 2006 2:01pm Sep 28, 2006 2:01pm
Ok now I know why I'm having problems
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Trade what you see - Not what you think
  • #16
  • Sep 28, 2006 2:27pm Sep 28, 2006 2:27pm
Most people don't want to work, they want it all, and they want it now. Why should they work for it when they can use someone's indicator and cruise all the way to the bank.

If those on the outside survive long enough to realise it's all smoke and mirrors, they'll end up here, or in the PF trying to climb out of the hole.

Even here, with the wealth of information freely available, it's the same. Give them a system which someone's already refined and it's like the starting gun in Whacky Races. When they find that there is work (thinking) involved, they stick another indicator on, thinking it will take the work out of it. You can see how little they want to work at it when you watch them post their trades and you realise they haven't even bothered to read the method's rules properly. One of the latest methods on the Forum calls for nothing more complicated than drawing a couple of trend-lines, and hitting some keys on a calculator, but all of a sudden lines are heading in the wrong direction, indicators are appearing on all their posts, all because it's easier than doing the job properly in the first place.

I thank my lucky stars that I stumbled over FF, or I don't think I'd still be in the game. I'm a long way from being any good at this, but I'm not going backwards as fast as I was. For this I thank Jim, Dial, Fiji and too many others to list.
  • #17
  • Sep 28, 2006 2:30pm Sep 28, 2006 2:30pm
Information has its place, without a doubt. Many believe information is power. Far toomany find applied information indomitable.

I would submit that simple revelation, what some call "inspiration", "feeling", a "hunch", or "something told me", I would submit that revelation far exceeds all the information/indicators/formulae that anyone can summon.

But revelation is probably far too simple for most to accept.....
  • #18
  • Sep 28, 2006 2:50pm Sep 28, 2006 2:50pm
Once there was a hawk standing on a tree watching a tiger and a lion fighting on the ground. He think the tiger and the lion are both stupid because, "why don't they fly high and then dive down toward their enemy? that's the simplest method to win."

A story from a Chinese Kongfu novel authored by Yong Jing
Target: Trading naked.
  • #19
  • Sep 28, 2006 5:12pm Sep 28, 2006 5:12pm
Quoting summitfx
Ok now I know why I'm having problems
good one
  • #20
  • Sep 28, 2006 5:50pm Sep 28, 2006 5:50pm
Quoting summitfx
Ok now I know why I'm having problems
Absolutely hysterical summit!!!!!!!!!
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