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Market conditions: trending vs. ranging, technicals vs. intuition

  • #1
  • First Post: Oct 23, 2007 5:25pm Oct 23, 2007 5:25pm
Hello,
I am quite a newb, but would like to discuss something.
From what I have learned so far, Oscillators seem to give good signals when the market is ranging/consolidating. MA crosses(any other methods?) give good signals when the market is trending.
Now how would one technically tell(with some indicator) whether a market is trending or ranging?

Also, successful trades don't seem to use EAs, often relying on gut feeling to filter out bad trades, thus making bigger profits that any purely technical method. Does that mean I'll never develop that holy grail?

Yeah, these questions seem poorly formulated, but maybe some input will get me on track. Just a slice of my current mindstate.
  • #2
  • Edited 6:31pm Oct 23, 2007 5:51pm | Edited 6:31pm
Quoting Kir
Hello,
From what I have learned so far, Oscillators seem to give good signals when the market is ranging/consolidating. MA crosses(any other methods?) give good signals when the market is trending.
Now how would one technically tell(with some indicator) whether a market is trending or ranging?
Much of what you want to know depends upon the time frame/s you want to trade from. A quick visual of a daily/weekly/monthly chart will make the trend or range stand out. Shorter time frames will change more quickly between trends and ranges.
Also, successful trades don't seem to use EAs, often relying on gut feeling to filter out bad trades, thus making bigger profits that any purely technical method. Does that mean I'll never develop that holy grail?
Can't say I agree with your assessment here. EAs don't have to do everything for the trader, but I think as time goes by more traders will use EAs to do more trading with less intervention from the user. You must understand that a well constructed EA takes months or years to develope and its designer has most likely spent years learning to trade before designing EAs.
Yeah, these questions seem poorly formulated, but maybe some input will get me on track. Just a slice of my current mindstate.
OK so you're a newb. Find or better yet, develope a strategy than makes money consistantly. If you develope it you will have a much better understanding of its strong and week points. As you're developing the strategy you can gradually code parts of it in an EA. This process will continue as long as you are trading.
Here's a good place to start
http://www.forexfactory.com/showthread.php?t=7031
Good Luck
  • #3
  • Oct 24, 2007 5:15pm Oct 24, 2007 5:15pm
I asked the same question a while back. I like to look at ADX and rainbow EMA's over different periods. ADX lags, but I like it. Please note that I am new to this so I really don't know what I am talking about.
  • #4
  • Last Post: Edited 10:26pm Oct 24, 2007 10:13pm | Edited 10:26pm
Well, the success and utter failure eas' is tight. I think both manual and automated trading is very tough contrary to what people say. If you could find 1 winning system, it is probably not that tough to automate! I guarantee, however, that winning system you think you have will be revised a good thousand times and you will find that it should have next to zero weaknesses or the market will, and i guarantee, will scold you hard and take your cash. It takes a lot of time to find out a system is cra p so don't marry it.
If I have one other final piece of advise is that your gonna want to take in from all the forums is that the concepts of wave movments, price, time and oscillators must be studied in detail and in combination. All are necessary for winning trades. - if you get to automation,
your ea better do it all. Its possible, but your gonna work harder than you ever dreamed. If you study the bars closely, you will be able to determine direction and turns.
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