usefulness of indicators and smaller TF's

first of all this is the rookie discussion so a lot of questions are asked here and IMO it's impossible to check them all.

Now I've read hundreds if not thousands of posts on almost as many forums for months and months about the use of indicators and Timeframes and I've read the articles in the school on babypips.com about two times from top to bottom but I still want to ask it myself here,

are indicators like the ichimoku cloud, the MA's, S&R, lower TF's, ... usefull or not?

The reason I'm asking is because I've been trading for almost a year now and I just want to get it out and because on almost all forums I read articles for newbies that say that you don't need indicators, that you at least need 100K in your account and that it takes about a decade before you are really succesful.

I can think of two reasons for this, one they are all telling the truth or two they are trying to confuse beginners so that they make bad trades which in return makes the people who've been writing those articles rich.

Too bad. I'd better look for experienced traders, not a vouchers.
I do not have vouchers and not hunting them but i tell you what: people who lose money in market, start teaching or writing articles/books to make money for living.

I know few traders who are demo trading but holds 10 vouchers.they just get vouchers because they are good writers.

ok, well there goes that pragraph(because I didn't really thought about what you guys said >_<). I just hoped that having vouchers meant something and to be more precise meant being an experienced trader because I don't know about you but I can't smell experienced traders and even the most experienced traders can post worthless posts.

Oh well, then I just want to hear everybody's opinion on this ^^

hey reaper.... thanks for editing your post.....

//----

are indicators like the ichimoku cloud, the MA's, S&R, lower TF's, ... usefull or not?

yes they are, at least in my mind.....

//----

I've been trading for almost a year now and I just want to get it out

don't....


//----

you at least need 100K in your account and that it takes about a decade before you are really succesful.

there might be some truth there depending on your trading abilities and just what you expect from your account..... it's almost human nature to expect too much from both.... and don't give the decade any thought, time passes all to quickly.....

//-----

I can think of two reasons for this, one they are all telling the truth or ,,,,,,

trying to discern motives is more difficult than predicting the markets direction.... and less profitable.......

//-----

there is at least one person that has made 19351 pips this year, 2010, in the eurusd alone..... he openly admires manual traders...... but knowing his own strengths and weakness , 99% of the trades were made by expert advisors which use a wide varity of trend following/lagging indicators along with pivots, s/r.....

his account size is small but growing, his expectations are small but realistic and his lot size is small today but time is on his side.....

there is plenty of room at the finish line, hang in there......h

thanks for the replies so far. keep 'em coming

No vouchers here. Have no idea how to get them. Couldn't care less. Use a 15 SECOND chart with a few simple indicators that help show trend and a 1-minute overlay with the same kind of indicators. Basically trade a congestion breakout for a few pips/ticks.
(I use something like a modified Alligator indicator. Adjusted the ma lengths and shifts till I got what I wanted.
Also on fx use horizontal lines every .00125 pips starting at the nearest x.xx00, similar to Murrey lines I guess).
Just my style. You have to find your own.

Indicators are absolutely useful if they give you the confidence to enter a trade.

However, if you mean do they have any predictive ability or statistical advantage......as far as I can tell the answer is absolutely not. I'm yet to see any hard statistical proof than an indicator gives better than 50/50 odds of being right for a future move. Most indicators are lagging and therefore only tell you what has happened in the past which you can easily see without the indicator. Non lagging indicators again as far as I have ever seen are never right more than 50% of the time. So in hard statistical terms they offer no advantage.

But with that said there are plenty of successful traders who use indicators to aid their trade decisions and therefore obviously find them very useful. If an indicator gives you the guts to get in to a trade, from where you can then manage for potential profits, then the indicator is invaluable.

As for time frames, you will get a lot of people telling you that the higher time frames are the best because the smaller time frames are just "noise". From what I can see, if you are using fundamental analysis for your trading decisions, then the higher time frames are the way to go. If you are using technical analysis, it makes no difference at all as far as I am concerned. The patterns you see on one time frame will repeat themselves and look identical on all time frames. Plus, you have to remember that only time frames below 1 hour are the same on all charts for every trader around the world. As soon as you go above 1 hour (i.e. 4 hour and daily etc), what you see on your charts is entirely different from what everyone else is seeing outside of your time zone, and therefore your trend lines, MA's, support and resistance lines etc, will be completely different.

You will no doubt get a million and one conflicting bits of advice and opinion on this. What I would say is don't listen to any of us. Have a look at the charts and indicators and make your own mind up. It's very easy for people on the net and in these forums to aggressively argue their case for what is right and wrong, and yet the vast majority of people here (with very strong and vocal opinions) are completely unsuccessful traders themselves and should be in no position to give advice. If you study the indicators and time frames well enough you will see in your own mind if they hold any value for you, and the only way you will ever become a profitable trader is if you find a strategy that you created and 100% believe in. No one here is going to be able to do that for you, and no one should be able to convince you of what is useful or not.

would like to mention, you have 1.... it was not given lightly and is very well deserved.....h

hayseed: Yu Da Man!
Thanks.
ps: Just really love that pic of you trading from a deer stand!

thanks a lot flotsom really appriciate what you said/typed.

But that goes for all of the replies ofcourse.

I've mentioned it a couple of times before already. Market has an ever changing nature. It's never the same, even when some things/events repeat themselves, they still are similar but not identical. This is why most of the traders fail. They fail to develop the same nature. Our nature is to develop a system and follow it all the time, but a certain system works only in certain conditions, conditions change - system stops working. So indicators sometimes reflect the market well, other times you cannot trust a single setup. Because indicators are tools, mostly mathematical, that are programmed to do a certain calculation all the time, no matter the conditions, and yes, they reflect the past not present, not future.

Nevertheless, as the theory of determinism suggests, the past shapes the future. Same applies to the market. The truth is, you have no other information about the price, except for what it has done in the past. This is how you can look at a chart and say: the price is near support right now, because it has bounced off this level several times before. Is this a valid statement? Absolutely. Add a candlestick formation on that support and you have yourself a system. I know a guy who got rich doing just this, s/r and candlesticks. So definitely, indicators, although they are lagging, can be useful, given that you have learned to give the right amount of discretion before trusting them.

The thing is, that if you haven't learned to feel the mood of the price, you will keep losing more than you want. I would suggest to start staring at a plain naked chart and watching the price move, nothing else. Only later add indicators, use MTF's, and so on.

And to summarize, your key to consistency is your ability to keep the emotions down, they make you do stupid things. I am an emotional person. And even though I have learned practically everything there is about technical analysis, I still struggle big time because of my emotions, they always make me close too early, or too soon. Emotions down = logic up, and hence logical use of indicators, money management, and so on.

So yeah, indicators are useful, but it depends on your personality.

Hey Kenz987, you got your 1st vouch within the last 2 days - congrats!!!! Maybe the secret of getting them is not caring - kind of like when Morgan Freeman (played Ellis Redding) in the Shawshank Redemption went to the parole board many times but was finally freed after he said in his last interview that he didn't care if he got out or not. Anyway beat you to #500 (he, he)! PS: I don't care either (hint, hint)...

hey eagle..... actually it was from about 10 days ago..... thank goodness he didn't have 500 posts back then..... took me almost a day to read those 490...... but it was time very well spent......h

Well, he must have not have know about the 1V when he posted 2 days ago.

are indicators like the ichimoku cloud, the MA's, S&R, lower TF's, ... usefull or not? Yes they are useful.

The reason I'm asking is because I've been trading for almost a year now and I just want to get it out and because on almost all forums I read articles for newbies that say that you don't need indicators, that you at least need 100K in your account and that it takes about a decade before you are really succesful....You don't need 100K but it's useful. Anything less than 10K puts unnatural pressure on if you want to earn a living. If you're not consistently profitable after about 3 years then forex is probably not for you.

Price action around support and resistance is what to learn about. If you then see a set up on, say, the daily, go down to the hourly and use price action or indicators for your entry and exit. That way you get smaller stop losses and a potential daily trade. This is the distilled "forexlite" tm version.

first of all this is the rookie discussion so a lot of questions are asked here and IMO it's impossible to check them all.

Now I've read hundreds if not thousands of posts on almost as many forums for months and months about the use of indicators and Timeframes and I've read the articles in the school on babypips.com about two times from top to bottom but I still want to ask it myself here,

are indicators like the ichimoku cloud, the MA's, S&R, lower TF's, ... usefull or not?

If you can make trading work with them then thats all that matters however alot of indicators were create by individual/s for specific application and there edge was either based or helped by the indicator therefore understanding it purpose and how it is best utilised is a key to having it work best for you. The problem is that while a strategy may incorporate an indicator it is not fully known unless the time and effort is put in by the individual whether they create the idea or whether they are following it as to how it benefits a particular strat. What I mean is that some strategies that I have seen and seen others follow have 3+ indicators and there is little reason as to why or if there is a reason why the vast of the information is held by the starter therefore any edge that lies in the strategy is hidden from view which means that people devote there time to following something that may and usually has no longevity in it. The last piece is why I dont have indicators and I have made enough profit by trading my way.

The reason I'm asking is because I've been trading for almost a year now and I just want to get it out and because on almost all forums I read articles for newbies that say that you don't need indicators, that you at least need 100K in your account and that it takes about a decade before you are really succesful.

Take a bench mark of say 20-30% growth annual which is great. If you are trading for a living, that means everything you pay for comes from the income derived from trading and no other source then 30% increase on 100k would be 30k. So from that 30k you deduct everything and what you have left at the end of the year is rolled into the next. SO for someone who takes in 35k per year in a regular job, they essentially on 100k NEED to grow by more than say 40% to cover year round cost and to add something to the account for future growth. The problem I have and I know people will say they achieve this and they achieve that from 10k-20k what ever it may be, they are growing there accounts at a high risk rate which is fine, so long as they can do it until there account reaches a relatively safe amount. Most dont get there. So 100k per year would be a bench mark for a safe risk, safe growth amount provided the increase you achieve can better your year round salary.

I can think of two reasons for this, one they are all telling the truth or two they are trying to confuse beginners so that they make bad trades which in return makes the people who've been writing those articles rich.

People will sell all sorts of crap because provided the price is right people will buy it "just" to find out whether it "works" or not. Robots that promise wealth with little capital that sell for $100US sell because what have some people got to loose, besides the $100 and there starting capital. I have seen robots that have very tight take profits and rediculous, if any, Stop Loss positions. Once it is programmed, optimized and can show a nice steady but compelling equity growth then all the creater has to do is sell it. It may take weeks or months but even at $100US it is relatively cheap considering some "manual" trading courses cost upwards of $2000US and there is just as much chance of the information being as reliable as a robots. So for the creator of the robot, once created all they have to do is advertise it. If it sells a 1000 copies then they have made $100k all for the cost of some programming time.

Razor

You need a mix of all inportance part is price action, indicators i would say just use 1 as a filter and master it it can be a macd,rsi ore stochastic but thats my opinion rest is price action

[quote=Ivan;3726369]Too bad. I'd better look for experienced traders, not a vouchers.
I do not have vouchers and not hunting them but i tell you what: people who lose money in market, start teaching or writing articles/books to make money for living.[/quote
]
Nice. I started using the voucher/post count as an inverse indicator awhile ago. There are some rare exceptions, but for the most part, there's a strong correlation between voucher/post count and trading competence.