If most indicators are made to fail..

Then why not trade against it? What I mean is.. Find a random indicator, test it out for a looong time, if you come to a conclusion that the indicator suck because it doesn't make you profitable, that's when you just do exactly the opposite of what your indicator tell you (signal). You should be profitable right?

Well, I've testing that theory in demo account.. and guess what, I still lose (my story below).


When I randomly select one indicator, I made myself a plan to trade with one indicator for a month.

My plan
=====
- 50 stop 50 take, in a EUR/USD market.
- Wait for the indicator to signal an opportunity to get in.

For one month, I was not successful.

So I decided to trade against my indicator signal with the same plan for a month. .. I was still not successful. So can anyone tell me what's wrong with this picture?

spread... sideways markets... other things i can't think of.

Markets are random and cannot be predicted (over time). Thus if you choose random time of day, random buy or sell, your chances of winning are 50/50.

You may see a week or month where a "random EA" may be profitable, that would be normal. Over years, it would average out to 1:1 win/loss ratio. Given that there is always a spread, the deck is stacked against you.

If you were to test an indicator over a long period of time, you would find that most are close to 50% accurate. Again, given spreads, you will lose over time, no matter what side of the trade you take.

An indicator that is greater than 50% would be a "holy grail".

Some time period of trading may actually be really accurate, others would be devastatingly bad. Overall, you're locked into the average accuracy of the indicator, which changes over time depending on market conditions.

You're what's wrong. The indicator is not responsible for your success or failure. As the post above states, indicators are only accurate 50% of the time and really make no difference at all to how profitable or successful you are. You could put a million indicators on your chart or none at all....you could trade in the direction the indicator tells you, or you could trade against it......it's all irrelevant. The only thing that determines if you will be profitable over time is your own mental ability to manage your trades.

(When I say it's you that's wrong, I don't mean a personal insult, I mean the trader as an individual is the issue and not some random pointless squiggles on their chart.)

Maybe you use the indicator in the right way. And you buy when the market says buy. But that doesn't mean the market won't retrace first, taking out your stoploss before going into your direction. That's why you don't have a 50/50 chance, this only applies if you don't use a stoploss. But this is to risky. That is the dilemma.