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Technical Analysis Fallacy

  • #58,161
  • Edited 11:58pm Feb 23, 2019 11:15pm | Edited 11:58pm
something interesting to watch.

though 1 thing to avoid is the predictive-ness here, so to avoid that, figure how to be market neutral, the market can continue to go up or down whichever way it goes, the only goal of you being a trader is just to follow it.

whats mentioned is 1 possibility.

Inserted Video
  • #58,162
  • Feb 24, 2019 2:15am Feb 24, 2019 2:15am
does it depend on the talents of someone?
  • #58,163
  • Edited 3:05am Feb 24, 2019 2:45am | Edited 3:05am
Quoting antonblood63
does it depend on the talents of someone?
Maybe your MO and end-state or outcome will depend on your individuality.

For instance: "So I am not worried that if others learn these ancient investment techniques they will become invalid. This is because candlesticks, as with all other charting methods, require subjectivity. Two candlestick analysts are like two doctors who went to the same medical school. Each may have the same knowledge about how the body works, yet each doctor, because of his experiences, philosophies, and preferences may give a particular patient a different diagnosis and treat the patient differently—even if the patient's symptoms are the same. The doctor brings his unique personality and perceptions to the diagnosis. So it is with you and technical analysis. You are a doctor of the market. How you read and react to the symptoms of the market's health through candlesticks techniques may not be the same as another candlestick practitioner. How you trade with candlesticks will depend on your trading philosophy, your risk adversity, and your temperament. There are very individual aspects. In addition, each market has its own unique personality. As the Japanese express it, "The pattern of the market is like a person's face no two are exactly alike."
Written by Steve Nison
Not to Advance is to Fall Back
  • #58,164
  • Feb 24, 2019 2:56am Feb 24, 2019 2:56am
Quoting antonblood63
does it depend on the talents of someone?
Depends on what you mean by talent. There are 3 main ingredients in learning trading well. Mo, mm and mindset.

Having talent as in understanding the markets helps you learn to be profitable fast, having talent in mastering the mindset keeps you consistent. Having an open mind while sticking to core basics allows you to survive curve balls while keeping to core basics and not deviate from it.

Let's just say, trading knowledge can be taught and mentored, mindset lessons, that's something totally different.
  • #58,165
  • Feb 24, 2019 12:54pm Feb 24, 2019 12:54pm
Quoting Exnav
{quote} Hello Split_unit, Since it's Saturday and I have some time. All what I need is to internalize my individual skills and knowledge. At the moment, I'am learning and training to stick to my guns. As far as I understand, you're promoting/ offering the Coursera, your own high level of proficiency and blaming on brokers and those traders who asked you to share trading ideas (for free). Yours is a paid one secret (of course), presumably forming a trader and mindset, ability to perform, act right by the book and having 100% guarantee. Whoever is...
Look, I am not claiming to have the secret sauce. I am also not hiding a secret system that I am not willing to share with the thread. What I can tell you is that what's made me profitable over the years is accumulated knowledge + experience. I have gone deep into learning market fundamentals - the CFA is rigorous in that aspect. Level one was general, level two was more on research and level three was on portfolio management. You won't ever succeed only knowing technicals - you need to have portfolio management and risk management skills. I personally believe that it is futile to trade purely on technicals because technical systems can be broken into two types; trending and mean reversion systems. The Forex market is a market that is constantly changing - you will have to master both trending and mean reversion systems. To master these systems you will have to figure out that the market environment changed (early), and for you to figure it out early, you will have to understand fundamentals. You will have to understand the catalysts that are driving price for momentum strategies and you will have to recognize market equilibrium in non-trending markets.

If you don't understand fundamentals - you won't ever be able to confidently make significant bets. What is worse is that you won't be able to identify catalysts when they change making you the last to react.

There was this old forum here, I think it was called "No Brainer Trades" or something like that - check him out. He correctly refers to the importance of fundamentals in technical trading. All he does is "refer". You still have to put in the work to understand the market. I do not think that it is enough to understand technicals and yourself to make money in the market anymore. Algorithms have made the market too unpredictable in the short term.

You don't need to pay for an education on how to make money anymore - the internet is the worlds biggest free information resource. You get free books, free videos, and free white papers on almost anything. I can probably spend 7 years working hard by learning off of the internet on how to become a doctor. The resource is here, all you need is the effort, unfortunately depleting your effort here won't result in anything but wasted time and effort.

Read that "Market Wizard" books, Jack Schwager interviewed the best and most iconic CTA's in his first book, the best stock market trades in his second book and the best hedge fund managers in his third book. You will find real gurus in those books. People who have made billions.

Goodluck.

P.S. Google a guy by the name Undrea Unger, a 4 time world champion trader. He is a guru, worthy of a cult.
  • #58,166
  • Feb 24, 2019 1:30pm Feb 24, 2019 1:30pm
Hi split_unit,
if some died trading without reading this thread, its understandable. But if someone posted here without reading the first pages of this thread, that is very unfortunate.
People exposed to the concepts mentioned in this thread are already convinced about its workings. They will not be looking anywhere outside, even if they were provided the holy grail.
You can't teach anyone who had been trading the methods mentioned here. There is definitely something here to learn. Please save yourself some time and start reading right away.
Welcome and good luck.

Quoting split_unit
{quote} Look, I am not claiming to have the secret sauce. I am also not hiding a secret system that I am not willing to share with the thread. What I can tell you is that what's made me profitable over the years is accumulated knowledge + experience. I have gone deep into learning market fundamentals - the CFA is rigorous in that aspect. Level one was general, level two was more on research and level three was on portfolio management. You won't ever succeed only knowing technicals - you need to have portfolio management and risk management skills....
  • #58,167
  • Feb 24, 2019 2:29pm Feb 24, 2019 2:29pm
What's up Split!

I actually changed the name of that thread to "Post your best long-term charts" because i thought that calling anything in trading a "No Brainer" was a complete BS.. no trade is every a no-brainer. Whoever sold you the stock has their reasons for punting and you have your reasons for buying. That's what makes a market. To call a trade a no-brainer is just asking to get your @ss handed to you by Mr. Market.

I don't post as much anymore (having kids has a way of decreasing ones time that you can devote to the market) but the thread is still there....I plan on doing a little more over there because I do find it's a good way of keep yourself honest. Sadly though they buried that thread in some section of FF that gets 10,000 posts a day so it's hard to get much dialogue.
https://www.forexfactory.com/showthread.php?t=584420

Anyhow, hope you are well sir.
  • #58,168
  • Feb 24, 2019 6:11pm Feb 24, 2019 6:11pm
Quoting InfinitySL
What's up Split! I actually changed the name of that thread to "Post your best long-term charts" because i thought that calling anything in trading a "No Brainer" was a complete BS.. no trade is every a no-brainer. Whoever sold you the stock has their reasons for punting and you have your reasons for buying. That's what makes a market. To call a trade a no-brainer is just asking to get your @ss handed to you by Mr. Market. I don't post as much anymore (having kids has a way of decreasing ones time that you can devote to the market) but the thread...

Hey Infinity,

Nice to hear from you! I am very well. We have come a long way my old friend. We are both old timers on this forum, I probably also visit this place 3-4 times a year. Too busy with life and work. Anyways keep in touch!
  • #58,169
  • Feb 24, 2019 6:29pm Feb 24, 2019 6:29pm
Quoting antmindset
Hi All, I just completed 200 pages of the thread. It took 2 months to do so. I am trying FTI approach in Demo account. Still long way to go. Once mindset, mo, mm are internalize i will start from page 201 to read more. I need to re-read those pages again. CookieMonsta, How your long sword doing? any luck with FTI, i read few pages where in you asked and he is not reveling it. I will take at least 1 year to reach at that point in this thread, but i am not in hurry. LEt me polish short sword,...
I think that I was misunderstood.

People got emotional and defensive thinking that I was attacking their beloved FTI and his thread.

Let me make one thing clear. I don't know FTI and I don't care about his thread.

Now that that's out of the way, I will get to what got my attention. It was simply the quoted post above. As a trader or investor, you are wasting a ton of time dedicating one year reading a thread where you're try to decipher some gurus technique. You are also wasting a ton of time if you think that this guru's golden advice will make you better! What you need is accumulated knowledge + experience. We all had humble beginnings and the difference between those that make it and those that don't is not the amount of effort they put, but the type. Who ever fails to realize this is wasting their time.

I think I've expressed my opinion on the topic clearly.
  • #58,170
  • Edited 7:00pm Feb 24, 2019 6:39pm | Edited 7:00pm
Quoting split_unit
{quote} Look, I am not claiming to have the secret sauce. I am also not hiding a secret system that I am not willing to share with the thread. What I can tell you is that what's made me profitable over the years is accumulated knowledge + experience. I have gone deep into learning market fundamentals - the CFA is rigorous in that aspect. Level one was general, level two was more on research and level three was on portfolio management. You won't ever succeed only knowing technicals - you need to have portfolio management and risk management skills....
I don't even know if you are serious or not, what you mentioned above IS taught in this thread WITH a focus on handling difficult environment. Also, it's possible to commit fundamental analysis fallacy.

I think all you are doing is jumping on a conclusion with exactly no clue what you are criticizing and are only using credentials to substantiate your claims.

I genuinely think you are just trolling, or you are just blatantly ignorant, when almost all advise you gave which has some bearing is already covered here, all you actually need to do is read more pages.

1 more thing, this thread has that other thread don't have, the perspective from a dealer and not a speculator. That counts for alot more, because these guys HAVE to quote the markets and are at times taking on adverse selection trades and that's the skill right there, trading out of adverse selection trades. Where else do they teach you this apart from going long short?

The odd part is really this.
technical systems can be broken into two types; trending and mean reversion systems. The Forex market is a market that is constantly changing - you will have to master both trending and mean reversion systems. To master these systems you will have to figure out that the market environment changed (early)

This specific part IS taught here, it really feels like you are just contradicting yourself.
  • #58,171
  • Edited 12:40am Feb 25, 2019 12:28am | Edited 12:40am
Quoting split_unit
{quote}You won't ever succeed only knowing technicals - you need to have portfolio management and risk management skills. I personally believe that it is futile to trade purely on technicals because technical systems can be broken into two types; trending and mean reversion systems. The Forex market is a market that is constantly changing - you will have to master both trending and mean reversion systems. To master these systems you will have to figure out that the market environment changed (early), and for you to figure it out early, you will...
Hello Split_Unit,

Thank you for your kind feedback. It's to the point of matter.
Briefly, I did read the book by Jack Scwager (7 years ago) and own it in my library. "The markets are not random"
As regards your MO, it's fine. Why not. Look, I used to be only a fundamentalist and "traded" only cash (never leverage). The only technical I had was round numbers. When I got news that price reached the number targeted I liquidated (squared). It was very simply and no nerve. But my positions were the shortest time for months. Then, I entered the technical charts Fx Spot world and still am trying to adapt - the easiest way I found for myself: trading intraday or holding several days positions, I use as little leverage as possible. Probably, this manner makes my MO different from most of Fti's followers. However, Fti himself has stated in the thread the max leverage 1:10, 1:7, 1:2 or better not at all.... So, otherwise, I follow the basics generously put here by FTI and my MO is like those of Fti's followers (who kindly shared and demonstrated them - publicly on FF).

As far as fundamentals are concerned, it's also everything within the TAF thread. E.g., you may look at the economic calendar, square before major news and take advantage aftermath, keep in mind tendencies like Brexit, Trade agreements, Greece crisis, around energy/ commodities countries developments, be ready for force-majors (11 SEP, SNB, conflicts, accidents,..) etc.

And to finish my concise essay, I would refer to John J. Murphy: "The statement "market action discounts everything" forms what is probably the cornerstone of technical analysis. Unless the full significance of this first premise is fully understood and accepted, nothing else that follows makes much sense. The technician believes that anything that can possibly affect the price—fundamentally, politically, psychologically, or otherwise—is actually reflected in the price of that market. It follows, therefore, that a study of price action is all that is required. While this claim may seem presumptuous, it is hard to disagree with if one takes the time to consider its true meaning."

All the best,
Exnav

P.S. You are persistently on the brokers. Nothing is ideal but it's our market structure as well, a part to be aware of. Recently, I switched to trade only with strictly regulated banks.
Not to Advance is to Fall Back
  • #58,172
  • Feb 25, 2019 4:09pm Feb 25, 2019 4:09pm
Quoting split_unit
{quote} You will be better equipped to trade in the market once you learn how the markets work. You won't find it here. Coursera might be a good place to start. Too many newbies, come to the site in the hope of the holy grail. You have to realize that FF is a newbie swamp, less than 1% of the people here know what they are doing, and only a few people from that 1% fully share their findings. If you want to be among the 1%, you have to realize that FF is a Forex broker backed website. They make their money when newbies come to their site and trade...
Sounds gloomy. So why do you still stay here? Time is the most precious resource right?
  • #58,173
  • Feb 25, 2019 11:42pm Feb 25, 2019 11:42pm
Quoting dispersion
{quote} Sounds gloomy. So why do you still stay here? Time is the most precious resource right?
Guess he has got something to prove?
  • #58,174
  • Feb 26, 2019 8:07am Feb 26, 2019 8:07am
Quoting split_unit
{quote} Hehehe this post cracked me up. Most of the replies to my post cracked me up. Why would I need to be spoon fed by you guys? I already have a CFA, MSc in Finance and work as a full time PM for a large asset manager. You probably didn't understand the value that Coursera offers due to your ignorance. Did you ever wonder who provides those courses??? Not some blood sucking Forex broker, that's for sure. People who teach at Coursera are the best in their field, some are academic and some are professionals and you won't find them here. If you...
Hi there,
Is nice to see someone new around that would add some colours or help look at another angle. Why not start off differently and participate in the discussion instead? Surely, no one owns all the knowledge in the world and I hope there is value we may bring to the table here and make the time worth while.
Still, I find it funny you mention those. If you are in the industry, then you should know the only credential and worth any participant can carry is not his certification but just the PNL along with market reputations, right? Maybe as a PM you operate differently as your MO would be completely different from a traders or market maker. Since both of career path partake in different activities in the eco-system. But no doubt, it would be interesting to hear life as a PM or what is your approach to the markets.
Anyway, coursera or udemy, quite frankly, the only true teacher would be the markets. Academics would and could only go so far. It is honing the skill day in and day out that brings the profit, like any other craft.

For the rest of the new peeps reading, take your time, do not rush. Lessons come when we're ready. And lessons will keep repeating itself until we're ready to learn the next. So good luck and good learning. Most importantly, use it, apply it, keep it sharp, or risk losing it and dulling the skill-set.
KISS - Keep It Simple & Strong.

Rgds
Fall in love with the process, and the outcome takes care of itself.
  • #58,175
  • Feb 26, 2019 1:28pm Feb 26, 2019 1:28pm
Quoting RelaxRay
{quote} Hi there, Is nice to see someone new around that would add ..... KISS - Keep It Simple & Strong. Rgds

...not if they are selling...FTI would not approve imo.

Alex
check out the terrain - follow never lead
  • #58,176
  • Feb 27, 2019 5:13am Feb 27, 2019 5:13am
Quoting alexandria
{quote} ...not if they are selling...FTI would not approve imo. Alex
they come and go.. just a passerby then.. its ok Alex.. desiderata

rgds
Fall in love with the process, and the outcome takes care of itself.
  • #58,177
  • Feb 28, 2019 6:57am Feb 28, 2019 6:57am
scout is used for testing waters. then why chief is sending a checker after that. what is the purpose. wont the scout be sufficient. generals please enlighten.
  • #58,178
  • Feb 28, 2019 11:22am Feb 28, 2019 11:22am
Quoting pannet1
scout is used for testing waters. then why chief is sending a checker after that. what is the purpose. wont the scout be sufficient. generals please enlighten.

Hi pannet1

i am not a general just a trader but the answer to your question is that it is better to send in 3-4 or even more scouts before you deploy troops sometimes, like when trying to feel tops or bottoms at certain levels/areas. personally if i use 3 scouts and i am wrong still, then i walk away as my 'feel' is not working well that time/day.

regards

Phil.
-be careful about what you allow to be put in your mind-
  • #58,179
  • Feb 28, 2019 11:55am Feb 28, 2019 11:55am
Quoting phil13
{quote} Hi pannet1 i am not a general just a trader but the answer to your question is that it is better to send in 3-4 or even more scouts before you deploy troops sometimes, like when trying to feel tops or bottoms at certain levels/areas. personally if i use 3 scouts and i am wrong still, then i walk away as my 'feel' is not working well that time/day. regards Phil.
thanks a lot phil,

so i conclude there is no immediate scope of me using a checker because the attack itself is 1,1,2
have to grow more to try it out.

thanks once again.

warm regards
  • #58,180
  • Feb 28, 2019 12:12pm Feb 28, 2019 12:12pm
Quoting pannet1
{quote} thanks a lot phil, so i conclude there is no immediate scope of me using a checker because the attack itself is 1,1,2 have to grow more to try it out. thanks once again. warm regards
Hi pannet1

My friend the whole idea of the scout/s is to use to save yourself from making a bigger mistake and to let you get a feel for what is happening, scouts are expendable and should always be viewed that way.

Regards

Phil.
-be careful about what you allow to be put in your mind-
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