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Technical Analysis Fallacy

  • #2,481
  • Apr 21, 2008 4:41pm Apr 21, 2008 4:41pm
Quoting luSan
Jairo,

I have been there and I know by experience that you are correct. That is why I am doing some modeling about it. Even with 90% win rate, if we do not know exactly when to pull the plug we might end up giving everything back plus some..

I believe that there are several components to this problem:

1. size
2. skew
3. % wins
4. Bar volatility for pair and trading time period
5. surrender strategy
6. Maximum allowable risk

This is a multiple space problem that have a very subjetive component. I mean: all these items are very mechanical...the missing component is when the mindset affect them...

for example...if I have 100 of winning trades, then why not to pull the plug when my pair changes its trend? Because after so many wins I believe that I cannot lose and then we are proven wrong!...we the surrender strategy must be set fixed and non-violable...a rule that says, "if this....,then i am out."

So, there you have it..we are thinking about all these...but as said by others "there is so much given by fti, that now we need to put all these piece together."

Regards
Hi LuSan,

Far from me trying to discourage anybody from experimenting what he/she feels the best for his/her style/personality. But I think the most important part of all this is your PA reading skills. If you are good at it, you may trade without any calculation, just reading PA and taking appropriate action. I have not reached that yet. I mean, my results are not so good. But I am training to calculate nothing, just feeling and acting. Anyhow, I wish anyone the best, whatever the style chosen.
  • #2,482
  • Apr 21, 2008 4:55pm Apr 21, 2008 4:55pm
Quoting Jairo
That happened some 6 months before discovering this thread ...
Okay, thanks for your post about your experience, Jairo

----------

Quoting mijamoto
regards and i hope i posted something useful and hope my oppinion is not false.(otherwise i am just youngster)
mijamoto ... your age has no relevance (at least to me), cuz if you make good sense with your comments/arguments/opinions/what-have-you, then that's all that matters to me

I can't say that I agree with your ...

Quoting mijamoto
we should buy straddle option
... lol, but many of your other points make very good sense to me
  • #2,483
  • Apr 21, 2008 5:06pm Apr 21, 2008 5:06pm
Quoting Jairo
Hi LuSan,

Far from me trying to discourage anybody from experimenting what he/she feels the best for his/her style/personality. But I think the most important part of all this is your PA reading skills. If you are good at it, you may trade without any calculation, just reading PA and taking appropriate action. I have not reached that yet. I mean, my results are not so good. But I am training to calculate nothing, just feeling and acting. Anyhow, I wish anyone the best, whatever the style chosen.
Jairo,

I am with you, I do not calculate anything. I strive for sensing PA and dancing her music...the dance that I do is so fast that before you can type in any number it is gone, finished, kaputt...

for example, my dance today lasted only 20 min, just 4 5M bars and done...It is because I sensed a trend change so I got out...of course...I could have reverted but I am just learning and I decline to dance more than one real dance per day....there is still too much to understand.

Still...modeling help me to check that what I am doing makes sense...you see if my scout and the second wave met profit, then my third wave is free of book risk...that is not bad...if volatility is less than 30 pips, then I should not bother with PT of 12 b/c I will never be able to get there...If the first rescue fail, why to bother with a second one? it is probably a trend change...Is this the case?

We do not need to wait to see the events to evaluate these situations...we need to have a plan prior to the dance...then just dance it without having to think or analyze...fti told us never to get into analysis mode when we are dancing...so I do weekend analysis.

I think...I study...I hope to learn!
Empty as water and soft as a facing wind mountain
  • #2,484
  • Apr 21, 2008 8:02pm Apr 21, 2008 8:02pm
@leighsww,

Thanks for your kindness. No apologies needed. After all your contribution has been priceless.

Happy trading to all.
  • #2,485
  • Apr 21, 2008 9:41pm Apr 21, 2008 9:41pm
About Elliot Wave what time frame would you look to do your count in, because you will get different counts in diffrent time frames.

I have been starting in the hour frame and looking at the big picture of the wave and the leg its in. Then I working my way in to the 5 min frame to calculate my entry in that leg. This as well as S/R levels give a picture.

But to me this seems to become to much TA when also combined with compound wave structer.
  • #2,486
  • Apr 22, 2008 2:05am Apr 22, 2008 2:05am
Quoting musgrove
About Elliot Wave what time frame would you look to do your count in, because you will get different counts in diffrent time frames.

I have been starting in the hour frame and looking at the big picture of the wave and the leg its in. Then I working my way in to the 5 min frame to calculate my entry in that leg. This as well as S/R levels give a picture.

But to me this seems to become to much TA when also combined with compound wave structer.
hi musgrove,

im not well versed in elliot but allow me to give it a shot?
erm you can use the wwave structures as the major wave and the ones in the 5 minutes as the minor waves to further streamline your entries. Personalky i use the wave structure of the hourly to determine by near term trend bias.

regards.
  • #2,487
  • Apr 22, 2008 3:52am Apr 22, 2008 3:52am
Quoting jest1081
hi musgrove,

im not well versed in elliot but allow me to give it a shot?
erm you can use the wwave structures as the major wave and the ones in the 5 minutes as the minor waves to further streamline your entries. Personalky i use the wave structure of the hourly to determine by near term trend bias.

regards.
This elliot thing could be too complicated: waves upon waves upon waves...I feel uneasy with complex trading. We could easily use the complexity to avoid facing a naked chart.

This week because of zoran I began labelling my trading session with ABCDE...This is not Elliot modern...but what I saw in fti shown model trade...It is a good way of naming things after the trading is done...

does it work? I do not know...Do we need it? I am not sure...it might even hurt me because I could stop sensing PA and that is not good -not at all...I just do not know and I am just learning this that and the other and refining the little I understand...

Still if you catch a ABC as I just did, you might get some pips home.

More interesting are the 3kings. I saw this morning one more time the dollar becoming weak and strong at the same time...It seems to me to be in an uptrend in all 5M kingdooms...I think that the dollar is mentally ill...I meant, psycho.

Enjoy
Regards,
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Empty as water and soft as a facing wind mountain
  • #2,488
  • Edited 4:35am Apr 22, 2008 4:21am | Edited 4:35am
luSan ... dancing with Elliott Waves is reading and dancing the PA. You are making this way too complicated.

However, you dance too short a dance, so you might not be able to dance with Elliott Waves because you are not able to wait for each of the wave patterns.

Study fti's trades and you will get a better idea of how he enters attacks which will give a better clue of how he uses Elliott Waves.

He did not exactly give me detailed instructions on this, cuz I think this is something he wants each of us to feel the dance on our own, but from what I have gathered from his trades and charts and from my own use of it, the premise is ... once you enter Scout, you wait for end of retracement wave and beginning of impulse wave and you put in level 2 attack. If volatility is high and PA moving fast, sometimes you cannot wait for next wave and you enter level 3 attack (and/or level 4, if there is one) upon next candlestick (as you see in the 4th level - the entry of 16 troops - in fti's example 1, 1, 2, 16 progression chart).

It's not needing to be complicated, so don't make it so :

-------

musgrove ... I ride the Elliott Waves in 5m, and look at higher timeframes for the major trend. I may consider how many waves have already been created on the higher timeframes to judge whether I need to wait for more confirmation on whether there will be a reversal, but I don't make that a priority, but I do take it into consideration.
  • #2,489
  • Apr 22, 2008 4:31am Apr 22, 2008 4:31am
Regarding Elliott waves, please keep in mind that sometimes they are obvious but other times not. Please do not assume they always appear although when I trade, sometimes they are obvious but I don't sit down and count them. If I detect wave 5 (3rd impulsive wave in the direction of the trend), I'll tend to look for an exit point when the dance changes. Also, sometimes the ABC correction is clear, but sometimes not until the B wave has appeared.

fti mentioned that he did not count waves in the traditional (commercial) sense but that they just appeared to the mind. This is in line with my understanding and to allow them to show up by being present rather than looking for them and counting waves (being predictive). Here is what fti said

"counting waves?, well no, not like in the elliot methodology that's being taught commercially. but they seem to appear to the mind when strong wave trend appears."

In this post http://www.forexfactory.com/showthre...97#post1806597
  • #2,490
  • Apr 22, 2008 4:35am Apr 22, 2008 4:35am
Quoting luSan
This elliot thing could be too complicated: waves upon waves upon waves...I feel uneasy with complex trading. We could easily use the complexity to avoid facing a naked chart.

This week because of zoran I began labelling my trading session with ABCDE...This is not Elliot modern...but what I saw in fti shown model trade...It is a good way of naming things after the trading is done...

does it work? I do not know...Do we need it? I am not sure...it might even hurt me because I could stop sensing PA and that is not good -not at all...I just do not know and I am just learning this that and the other and refining the little I understand...

Still if you catch a ABC as I just did, you might get some pips home.

More interesting are the 3kings. I saw this morning one more time the dollar becoming weak and strong at the same time...It seems to me to be in an uptrend in all 5M kingdooms...I think that the dollar is mentally ill...I meant, psycho.

Enjoy
Regards,
lol no. it indicates that zoran and leighs are making a killing on the euryen.
eur is stronger than usd and usd strongr than yen, equates to huge volitilty in euryen.

what i would usually do in this sort of instance is to pull out a euryen chart, find an entry and place it to the back. monitor the 3kings exit is determined when their PA tears.
  • #2,491
  • Apr 22, 2008 4:40am Apr 22, 2008 4:40am
Quoting jest1081
lol no. it indicates that zoran and leighs are making a killing on the euryen.
I mentioned previously that I don't trade that pair anymore :, cuz it has too high a margin debit, thus it lessens the amount of troops available to trade, lol.

I now only trade currency pairs that have 100 margin debit per lot (gives me more available ammo)
  • #2,492
  • Apr 22, 2008 4:57am Apr 22, 2008 4:57am
Quoting Zoran
Regarding Elliott waves, please keep in mind that sometimes they are obvious but other times not.
Yup, sometimes a retracement wave may be only 3 candlesticks. This is where we can't let Elliott Waves be a rule to our trading/dancing.

It is useful when it can be easily seen, but if it's not obvious, then we enter and exit on the feel of the PA's candlesticks and whatever patterns they unfold.
  • #2,493
  • Apr 22, 2008 6:00am Apr 22, 2008 6:00am
leigh, agreed. I let EW come to me so I don't go looking for it.

jest, I haven't traded EJ for quite some time. Lately I've only been trading DJIA and GBP/JPY. They tend to follow each other so I keep an eye on both. I still don't have a 3 kingdoms setup but I should have one shortly.
  • #2,494
  • Apr 22, 2008 7:03am Apr 22, 2008 7:03am
Quoting jest1081
lol no. it indicates that zoran and leighs are making a killing on the euryen.
eur is stronger than usd and usd strongr than yen, equates to huge volitilty in euryen.

what i would usually do in this sort of instance is to pull out a euryen chart, find an entry and place it to the back. monitor the 3kings exit is determined when their PA tears.
That says a lot...the yen...Now I could never take $ from zoran and leighs:...I only trade the EUR...That is enough trouble for me...just a pair, just a pair...I cannot split myself in two

Elliot?... at my speed I cannot go up but down in time...no need for it, but I will keep my eyes open... the time will come for its use.
Empty as water and soft as a facing wind mountain
  • #2,495
  • Apr 22, 2008 5:36pm Apr 22, 2008 5:36pm
Quoting luSan
Elliot?... at my speed I cannot go up but down in time...no need for it, but I will keep my eyes open... the time will come for its use.
As fti said, they tend to appear during certain market conditions.

"they seem to appear to the mind when strong wave trend appears"
  • #2,496
  • Apr 23, 2008 8:47am Apr 23, 2008 8:47am
leighsww, any update on fti? is he OK? Taking a break? Or you don't know?

Maybe the bank cought him spilling out secrets..
  • #2,497
  • Apr 23, 2008 9:37am Apr 23, 2008 9:37am
Quoting piccolo
leighsww, any update on fti? is he OK? Taking a break? Or you don't know?

Maybe the bank cought him spilling out secrets..
I fear for him too...He is just gone gone gone...What we learned is really very powerfull...Our only concern is to manage the crazy days and not to overextend with greed....to practice, practice, practice his lessons.

Where is fti? ....
Empty as water and soft as a facing wind mountain
  • #2,498
  • Apr 23, 2008 9:54am Apr 23, 2008 9:54am
You do have a point, but as for me just like the name implies technical analysi is very necessary. It is only important for all traders to note that ni indicator can tell you every thing you need to know, there is no ideology that is most perfect when it comes to trading.Efery trader has to find solace in the idea, indicator and eve strategy that works best for him.This is my opinion.
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  • #2,499
  • Apr 23, 2008 10:09am Apr 23, 2008 10:09am
Ive heard about FTI alot.

What is his system?
  • #2,500
  • Apr 23, 2008 10:18am Apr 23, 2008 10:18am
Quoting IrvineTrader
Ive heard about FTI alot.

What is his system?
experience
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