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Why do traders use so many indicators?

  • #81
  • Feb 13, 2020 3:50pm Feb 13, 2020 3:50pm
Quoting JetTrader
{quote} But, that assumes (see your tag line) it only moves up and down. What if....the market actually moved in three (3) dimensions through six (6) different axes. Shhhhh. Don't tell anybody. It'll be our little secret.

Nope, price moves up and it moves down.

Yep, well known video regards dimensions..

With respect.........

Market Maker (Algo) has to give a price, no matter what.
Market maker has to take opposite side, that's what it does, price has to move.
Our job is to determine whether its filling Longs or Shorts, that is all we have to find out.
Reading a chart will help determine the Market Makers position and gives us the best possible entry based on a scenario that is played out day after day.... but all the data we are given cannot show 100% the Market Makers hand.
The problem is, and everyone knows this, no matter what we do with the data, it's in the past, has no relevance to the future.
It does not determine when the Market Maker has satisfied its requirement to stop/turn a market as we do not have access to that information.
Understanding the market makers role within Forex would be a greater help than any amount of indicators.
Its like flying a final approach on instruments when the simple option is to look out of the window...Occams Razor.

Cheers....
  • #82
  • Feb 13, 2020 4:39pm Feb 13, 2020 4:39pm
Why do traders use so many indicators?

Because ALL indicators work SOME of the time

And when told to go naked, nothing else is offered

Until now, learn more in the Trading forum

Simple Monday Tuesday System



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It takes a lot for me to IGNORE you, but you can try.
  • #83
  • Feb 13, 2020 4:42pm Feb 13, 2020 4:42pm
Quoting moodybot
The problem is, and everyone knows this, no matter what we do with the data, it's in the past, has no relevance to the future. It does not determine when the Market Maker has satisfied its requirement to stop/turn a market as we do not have access to that information. Understanding the market makers role within Forex would be a greater help than any amount of indicators. Its like flying a final approach on instruments when the simple option is to look out of the window...Occams Razor. Cheers....
If this assumption is true then all historical data in the form of candle/bar/line and their derived indicators become useless information. Since future market price is independent of past price data. The use of trading charts and any form of technical analysis is rendered useless since future price is random.
Know what you trade
  • #84
  • Feb 13, 2020 4:49pm Feb 13, 2020 4:49pm
Quoting Erebus
Why do traders use so many indicators? Because ALL indicators work SOME of the time And when told to go naked, nothing else is offered Until now, learn more in the Trading forum Simple Monday Tuesday System {image}
I made a request to naked chart pure price action traders here.
https://www.forexfactory.com/showthr...1#post12749351
Know what you trade
  • #85
  • Feb 13, 2020 4:57pm Feb 13, 2020 4:57pm
Quoting BWilliam
{quote} I made a request to naked chart pure price action traders here. https://www.forexfactory.com/showthr...1#post12749351
I missed that, but now you have the answer

Everybody's happy



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Before you ask DEMO
It takes a lot for me to IGNORE you, but you can try.
  • #86
  • Feb 13, 2020 5:09pm Feb 13, 2020 5:09pm
Quoting BWilliam
{quote} If this assumption is true then all historical data in the form of candle/bar/line and their derived indicators become useless information. Since future market price is independent of past price data. The use of trading charts and any form of technical analysis is rendered useless since future price is random.
Absolutely correct, trade the present, it's all we can do.

No, its not random, the market maker has to, by definition of offering a market, balance the market. It has to.
That is the edge that can be used.
  • #87
  • Feb 13, 2020 5:10pm Feb 13, 2020 5:10pm
Update: Harmonic AB leg now 38.2% and 50% qualified

Attached Image (click to enlarge)
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The market did in fact hold point "B" and then qualified the "harmonic" nature of the pattern with BC leg passing through 38.2 and 50. My Line Charts plot on the Close price. Though the pic does not show the market at 50%, the lowest low for the day did touch 50%.

As usual with Harmonic Patterns, they retain their harmonic properties only when they remain within the boundaries of the pattern's ratios. So, this means that the BC leg must not extend beyond point "A" in the XA leg. If that happens, this converts from a Long Reversal XABCD to a Short Continuance ABCD. Again, I don't have Harmonics built into the System, but this is easy enough to do on a chart manually and it gives New Harmonic Traders a different kind of context in which to observe Harmonics at work.

Draw -41. Target +199. RR 4.8. Probability now 79.39%.

So, there's been a consistent range of Probability that includes 90%+ to 70%+. This would be part of the Signal's Density Probability which is something that I have to manually calculate (track) in this version of the System. That's a separate function I run in Excel on the side as it is simple enough to do quickly. This is an example of how I obtain Density Probability inputs into a more uniform Density Probability calculation in Excel.
  • #88
  • Feb 13, 2020 5:16pm Feb 13, 2020 5:16pm
Quoting moodybot
No, its not random, the market maker has to, by definition of offering a market, balance the market. It has to. That is the edge that can be used.
I agree with this completely. It's the only analysis about this market maker balancing the market that gives an edge. It happens on all assets day in day out without fail, it's how the market works.
Know what you trade
  • #89
  • Feb 13, 2020 5:17pm Feb 13, 2020 5:17pm
Quoting moodybot
{quote} Nope, price moves up and it moves down.
Whatever you say!
  • #90
  • Feb 13, 2020 5:26pm Feb 13, 2020 5:26pm
Quoting JetTrader
{quote} Whatever you say!
If you think rocket science can outsmart the market maker than good luck.

Cheers
  • #91
  • Feb 13, 2020 5:32pm Feb 13, 2020 5:32pm
Quoting BWilliam
{quote} If this assumption is true then all historical data in the form of candle/bar/line and their derived indicators become useless information. Since future market price is independent of past price data. The use of trading charts and any form of technical analysis is rendered useless since future price is random.
Which is the same thing as concluding that all of the earth's history has absolutely nothing to do with the earth's present, or its future. Or that a butterfly flapping its wings in Japan, has nothing to do with the Hurricane in Florida. Or that the Quantum Field is independent and detached from Atom. Or, pick any number of clearly related things and then try to detach their evident Cause and Effect relationship.

One's perception will always be bound and constrained by one's experience. So, if all he observes is two dimensional price, then that's all he observes. I would only say that his observations have a lot to do with his experiential research of Market Data. And, this gets to a really important point for the New Traders that I should probably expand on here.

If all you do is research what's already been produced, then all you will ever learn is what you've already been told. If you expand your consciousness then your research into market data will likewise expand and you might discover observations you've never contemplated before and that existing methods of discovery are not able to observe inherently. New observations don't come easy. They are not handed to the Trader on a silver platter. They are brought into the mind of the Trader through their willingness to Always Question The Data.

What is Data Analysis, if not questions about data. So, the real effort here is to try and ask unique questions about the data that have either never been asked before, or that have been asked before but where no answers were discovered in return. Core Data Research is what I call it and everything I do is a direct consequence of questions that came out of that brand of research.

This is different from merely searching for Market Patterns in data. This is about asking WHY the pattern exists in the first place. That's Core Research and it goes deeper than the pattern itself. So, for the New Traders out there, if you are so inclined, you might find Core Research as ultimately the source of some pretty neat trading ideas. But, it takes lots of time, energy and effort to flush that kind of knowledge to the surface and even more work to figure out how to put it all together.
  • #92
  • Feb 13, 2020 5:34pm Feb 13, 2020 5:34pm
Quoting Erebus
{quote} I missed that, but now you have the answer Everybody's happy {image} Before you ask DEMO

Nice trading! Well done.
  • #93
  • Feb 13, 2020 5:45pm Feb 13, 2020 5:45pm
Quoting moodybot
{quote} If you think rocket science can outsmart the market maker than good luck. Cheers

Market Makers are producing the Rocket Fuel. No need to outsmart them. Just use the fuel they create.

Again, until one defines what a "Trade" actually means by specifying a clear Target to be struck - there is no such thing as a "Trade" because you have no objective other than "trading" into the ether. If one defines a "Trade" as "Until Profitable" the one is strapped with the responsibility of defining what "Until Profitable" means as that could have multiple definitions above BE.

Once you define "Trade" then you can measure whether the trade is working or not. Until you do that, you are throwing darts at "Until Profitable" which could change on dime. Is the trade defined at 5 pips. Is it defined at 200 pips. What's the Risk and how is Risk defined. Is Risk inline with the Target. Does the Risk Ratio provide a Probability. These are all questions that define the term "Trade" and form the basis of that which can be measured and quantified as being on course or not for any given trade.

As long as your Entry remains within the parameters of the definition of "Trade" - you have something that can be repeated reliably. If your Entry falls outside the definition of the trade parameters, then relying on it repeatedly will be difficult at best long term.

So, we can approach the "Trade" flying by the seat of our pants, or we can approach the trade using Rocket Science - LOL. That last part was a joke.
  • #94
  • Feb 13, 2020 5:47pm Feb 13, 2020 5:47pm
Quoting JetTrader
This is different from merely searching for Market Patterns in data. This is about asking WHY the pattern exists in the first place. That's Core Research and it goes deeper than the pattern itself. So, for the New Traders out there, if you are so inclined, you might find Core Research as ultimately the source of some pretty neat trading ideas. But, it takes lots of time, energy and effort to flush that kind of knowledge to the surface and even more work to figure out how to put it all together.
I offer this explanation. Imho.

The market maker or Algo does the job of offering the bid and ask quotes to make market with this underlying objective to ALWAYS balance the market. This MM or algo balancing of the market activity leaves footprint in the sand that we see as patterns on the chart.

Our job is to read this MM/Algo long or short balancing activity correctly to stay in line with them to gain an edge, ride the MM/Algo balancing act it's the only way.
Know what you trade
  • #95
  • Feb 13, 2020 5:55pm Feb 13, 2020 5:55pm
Update: BC leg now 61.8% qualified

Attached Image (click to enlarge)
Click to Enlarge Name: Harmonic 618 Qualified.png Size: 87 KB


Panel is cooked Short. So, if I were short-term trading this, there was plenty of Short side signal near the open at 00:00. However, my previous entry was above that level Long with sufficient (previous) Long side bias in the Panel. Fairly textbook from here thus far. However, I'm not playing short ball here, I'm running a longer haul trade as defined by the Target.

There has been plenty of naked chart Short side scalps between yesterday and today and all of them had good Panel support to boot, however. I'm not knocking the Short side, I'm just playing a different game.

Draw -45.6. Target 199. RR 4.36. Probability now 77.0% (still within parameters of the object)
  • #96
  • Feb 13, 2020 6:01pm Feb 13, 2020 6:01pm
Quoting BWilliam
... long or short balancing activity correctly to stay in line with them to gain an edge, ride the MM/Algo balancing act it's the only way.

Pretty much says it all. Nothing to do after that but define the Trade with a Target then wait (assuming good money management habits, of course.).
  • #97
  • Feb 13, 2020 6:13pm Feb 13, 2020 6:13pm
Quoting JetTrader
{quote} Which is the same thing as concluding that all of the earth's history has absolutely nothing to do with the earth's present, or its future. Or that a butterfly flapping its wings in Japan, has nothing to do with the Hurricane in Florida. Or that the Quantum Field is independent and detached from Atom. Or, pick any number of clearly related things and then try to detach their evident Cause and Effect relationship. One's perception will always be bound and constrained by one's experience. So, if all he observes is two dimensional price, then...
Garbage. Sorry, but that is complete garbage.

The market maker has to service the market in a particular way.

You visit the shops everyday, day in day out. Could I put money on the time when you shop?
No. I can see your shopping list (Price Movement) but I don't know how much you have eaten.
I know you will visit the shops, but when is the question and I would have no idea of that.
What do I know? I know that when you have visited the shop you don't need any food.
That's when I look to trade, and the evidence is on the chart. A window where they don't need to shop.
Any other time it's trading within a washing machine...
  • #98
  • Feb 13, 2020 6:21pm Feb 13, 2020 6:21pm
Quoting moodybot
{quote} Garbage. Sorry, but that is complete garbage. The market maker has to service the market in a particular way. You visit the shops everyday, day in day out. Could I put money on the time when you shop? No. I can see your shopping list (Price Movement) but I don't know how much you have eaten. I know you will visit the shops, but when is the question and I would have no idea of that. What do I know? I know that when you have visited the shop you don't need any food. That's when I look to trade, and the evidence is on the chart. A window where...

You need to post a chart of what you are doing with EURAUD right now and that will suffice.

You can claim to know what I or anyone else is doing without the benefit of understand what you are saying - that's your option. However, EURAUD is being traded right now and there are many posts showing exactly what I'm doing with it. So, compare apples to apples and post something that shows precisely where you would be trading EURAUD, so that we can see what's in your shopping carte specifically on that Pair. That's the Pair being discussed right now.
  • #99
  • Feb 13, 2020 7:21pm Feb 13, 2020 7:21pm
Quoting JetTrader
{quote} You need to post a chart of what you are doing with EURAUD right now and that will suffice. You can claim to know what I or anyone else is doing without the benefit of understand what you are saying - that's your option. However, EURAUD is being traded right now and there are many posts showing exactly what I'm doing with it. So, compare apples to apples and post something that shows precisely where you would be trading EURAUD, so that we can see what's in your shopping carte specifically on that Pair. That's the Pair being discussed right...
I'm not doing anything with EURAUD.
Its in its death throws of a short run. Perhaps Monday/Tuesday if it continues down bu that's not a given.
At the moment it has several targets to take out and I don't know, not seeing the Market makers book as to whether its going to continue and take one or all of the targets, stop and reverse or consolidate.
I'm not playing darts, did that for too long and I don't guess.
  • #100
  • Feb 13, 2020 9:05pm Feb 13, 2020 9:05pm
Quoting moodybot
{quote} I'm not doing anything with EURAUD.
Neither was I, but the OP required that we follow his rules. That's how threads work. If you don't want to follow the OP's rules, then disagree while not pretending you know better than those who are following the rules of the OP. Following rules are of paramount importance when trading.

I was not doing anything with EURAUD either. The OP wanted a trade, I was busy taking care of some other duties and grabbed a pair. That pair happened to be GBPCHF and then EURAUD. Both randomly picked. Can you randomly pick a pair and then know how to trade it? That would be a sign of a fairly good Trader, if you could. That's what I did. I randomly grabbed the first two pairs that were sitting in the first open virtual machine I could find and I made a decision based on what the System was showing at the time. That's what the OP requested - that's what I did and I did it without making excuses.

Now, go grab your EURAUD analysis and tell us how you would trade it. Its not hard. You are a trader, right. A Trader should be able to take any pair (and I mean any), analyze it and then determine what best to do with it. If your analysis tells you that you can't do anything with EURAUD right now, then that's what your analysis tells you. However, my analysis tells me a different story - one that is unfolding right before your eyes in this thread.

Are we clear?
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