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Technical Analysis Fallacy

  • #19,941
  • Oct 28, 2010 4:07am Oct 28, 2010 4:07am
Quoting maheswara
ah no worries,
I get into this screwy cycle of losing day n self doubts , usually starts when i make too much in a day n feels like superman ...
it ll all end though , I just need to survive the phase ,either that or ill just have to start from scratch again
my problem was that at one point I realised that I take +7 pips profit trades and sometimes let the losses ride to -150. After such days you wonder what the hell are you doing..

And then there are days with rescues.. where the whole day gets by while trying to get to breakeven. Then when you do, it does not feel like a success, lol. You wonder why didn't I flip and ride the whole move till the book reaches the sky. Of course it is nice to see that you timed the only 15 pip retrace that there was.

Sometimes its just too much thinking and doubting yourself, instead of just following the clues, which are always there.

Everybody makes mistakes, but the small profit and big loss trades are a classic. Admiting that you have a problem (scorpion) is already half of the solution.
  • #19,942
  • Oct 28, 2010 4:12am Oct 28, 2010 4:12am
aud has taken off again. without me, heh.

will take a break, too much posting.
  • #19,943
  • Oct 28, 2010 4:17am Oct 28, 2010 4:17am
Quoting 1234
Training the nerves, lol. Piccolo

I agree with this. Today I was going short on the EUR/USD at 1.3818 and price started going north, I took at a rescue at the Asian high at 1.3830 and price kept going up. I looked at a second attempt at 1.3850 but when price went to 1.3853 I got nevous and decided to see if it would reach 1.3860 area. Price went quickly down to 1.3835 and I decided to wait and see. After a few bars up and down it reached my BE and I closed everything. It was a nervous time.

Also for me there was no clear direction. At the time...
Hi Ray,

ok, from hindsight everything is much easier. But you may read one of my postings frokm this morning, where I was talking about the Lodon opening (http://www.forexfactory.com/showpost...ostcount=19927)

Attachend is an image, that shows a possible rescue action.
I have done that as attack sequence this morning my my self.

Hope it gives you some hints ...
Attached Image (click to enlarge)
Click to Enlarge Name: 2010-10-28_EU_LO-Rescue.jpg Size: 53 KB
  • #19,944
  • Oct 28, 2010 4:22am Oct 28, 2010 4:22am
Thanx friends for that vital discussion this morning!
Have to leave for preparing family lunch now.

Hope to see you later again!

MaMood
  • #19,945
  • Oct 28, 2010 4:40am Oct 28, 2010 4:40am
Attachend is an image, that shows a possible rescue action.
I have done that as attack sequence this morning my my self.-Mahood

Many thanks, like the idea of taking some of the rescue troops out and lowering the size of the scout or troops that need to be rescued. Ray
  • #19,946
  • Oct 28, 2010 5:19am Oct 28, 2010 5:19am
Quoting hcong168
I do.

Just my personal experience:

I rank the trading components of this tactic in term of difficulty to master from easy to difficult:

1. rescue
2. attack
3. flip

Flipping, if not done properly will end up get caught at both ends. And when that happen, I will hold on to my mouse and reacess - thinking how to out myself out of the hole .
My observations also, putting it simplistically:

Rescue can be done successfully 90% of the time with some skew skill. Beware of the 10% tsunami and do not get too carried away (watch exposure) adding positions during congestion (never know from which side the impulse will come)

Attack requires dancing and skew skill.

Flip requires timing, skew and decisiveness as it locks in loss once for all. I believe fti teaches to flip only once, aim for BE and regroup.

After almost one year of practice I still have not learnt attack which is central to fti teaching Am training with the mantra "Buy Low Sell High" in the direction of bias (short chart M5 M15 trend). I believe playing both sides make it hard to take advantage of position sizing and therefore the MO requires very good timing. Personally I do not believe in market timing independent of position sizing.

Thank you all for keeping the thread alive hope all is well with fti.

Regard,
Baifu
  • #19,947
  • Oct 28, 2010 6:48am Oct 28, 2010 6:48am
Quoting Baifu
[...]

After almost one year of practice I still have not learnt attack which is central to fti teaching Am training with the mantra "Buy Low Sell High" in the direction of bias (short chart M5 M15 trend). I believe playing both sides make it hard to take advantage of position sizing and therefore the MO requires very good timing. Personally I do not believe in market timing independent of position sizing.

Thank you all for keeping the thread alive hope all is well with fti.

Regard,
Baifu
Hi Baifu,

what's about a simple idea to train you attack skills.

Assuming you are trading the M5 chart and uing M1 for timing, M15 and H1 for trend. Attached is an M5 chart of cable from todays London morning session.

The idea: Add one level of troops every new M5 bar, when the one before was a "strong bar".

What is a "strong bar"?

- you have seen good/increasing momentum(speed of growth)
- it is longer than the average bars before
- It has no or a very small top wick only.
- it was not diving to deep (<40%) into the price range of the bar before.
- PA is not approaching a resistance or support area

When the first NON-Strong-Bar appears, reduce exposure or square out.

That idea is something like training wheels for you bike.
You have to go beyond such an approach with your evovling experience, because it is very rigid.
But it will give you the feeling for attacking the market and will take the fear of being wrong ...
Attached Image (click to enlarge)
Click to Enlarge Name: 2010-10-28_GU_London2.jpg Size: 75 KB
  • #19,948
  • Oct 28, 2010 6:58am Oct 28, 2010 6:58am
Back to the charts now.
NY boys are stepping in and we are ahead of major US figs ....

Good fortune!
  • #19,949
  • Oct 28, 2010 7:05am Oct 28, 2010 7:05am
Quoting MaMood
Hi Baifu,

what's about a simple idea to train you attack skills.

Assuming you are trading the M5 chart and uing M1 for timing, M15 and H1 for trend. Attached is an M5 chart of cable from todays London morning session.

The idea: Add one level of troops every new M5 bar, when the one before was a "strong bar".

What is a "strong bar"?

- you have seen good/increasing momentum(speed of growth)
- it is longer than the average bars before
- It has no or a very small top wick only.
- it was not diving to deep (<40%) into the...
This could be the simplest and best way how to get comfortable with adding to the position. To learn the mechanics and psychology that comes with it.
  • #19,950
  • Oct 28, 2010 7:07am Oct 28, 2010 7:07am
Happy trading day everyone. Just stopped by to say excellent discussion today. Great topic and I believe fti would be happy with the ideas and issues discussed (would probably warn against being rigid). Been long the G/$ and the E/$ today and now on the sidelines waiting (yep, I exit after making the candle observations that Mamood mentioned). Let's reload and do it again!
  • #19,951
  • Oct 28, 2010 7:24am Oct 28, 2010 7:24am
looks like a single player is toying.. first the g/u, then e/u and last but not least u/j. with 5min difference.
  • #19,952
  • Oct 28, 2010 7:27am Oct 28, 2010 7:27am
Quoting piccolo
looks like a single player is toying.. first the g/u, then e/u and last but not least u/j. with 5min difference.
This came on the news:

LONDON, Oct 28 (IFR) - GBP/USD has popped into the 1.59s to trigger stops and further fuel the intraday rally. Cable has quickly rallied to just shy of the next resistance in the 1.5930s, with EUR/GBP reflecting this Pound strength to put the support into the figure in focus. Recent headlines note the latest poll results, where only one economist of the 57 polled expected the BoE to increase QE at the November 4th meeting. 26 of 48 expected the BoE to increase QE levels at somepoint (most likely early 2011), while rates are now expected to rise to 1.0% into Q4 next year. [email protected]
  • #19,953
  • Oct 28, 2010 7:34am Oct 28, 2010 7:34am
number came better than expected.

if somebody mentions "less QE", USD bulls will march on a parade.
  • #19,954
  • Oct 28, 2010 7:59am Oct 28, 2010 7:59am
That idea is something like training wheels for you bike.
You have to go beyond such an approach with your evovling experience, because it is very rigid.
But it will give you the feeling for attacking the market and will take the fear of being wrong ... Mahood

Nice approach to learning an attack. Ray
  • #19,955
  • Oct 28, 2010 8:17am Oct 28, 2010 8:17am
Quoting MaMood
Hi Baifu,

..........
The idea: Add one level of troops every new M5 bar, when the one before was a "strong bar".

What is a "strong bar"?

- you have seen good/increasing momentum(speed of growth)
- it is longer than the average bars before
- It has no or a very small top wick only.
- it was not diving to deep (<40%) into the price range of the bar before.
- PA is not approaching a resistance or support area

When the first NON-Strong-Bar appears, reduce exposure or square out.

That idea is something like training wheels for you bike....
Thanks Mamood for the excellent training tool.

The fti classic attack - feel momentum change as if the chart suddenly wakes up - is not always easy, I am often fooled by false breakouts of thin markets. The "attack" by adding position after retrace when troops are in profit is easier and technically not so different from rescue, except in the skew used to keep avg price a safe distance from current price.

Rgs,
Baifu
  • #19,956
  • Oct 28, 2010 8:44am Oct 28, 2010 8:44am
Quoting Baifu
Thanks Mamood for the excellent training tool.

The fti classic attack - feel momentum change as if the chart suddenly wakes up - is not always easy, I am often fooled by false breakouts of thin markets. The "attack" by adding position after retrace when troops are in profit is easier and technically not so different from rescue, except in the skew used to keep avg price a safe distance from current price.

Rgs,
Baifu
Hi Baifu,

of course you are right.
It is not easy to feel the momentum and to get not fooled by false break outs.

I'm still pondering about how to get it organized:
Will do a kind of live trading session let's say every thursday or so. But have still no final tool and idea, how to let you see, what I see. And not to waste to much time with typing my thoughts.
I'll keep you informed as soon as I have found a solution ....

The idea is to show you, that it is not too difficult to judge the market, when you have the right information respectively charts on your screen and know, how to read them.
It is all about the flow, the music, the dance or however you want to call it ...

We will see ...

MaMood
  • #19,957
  • Oct 28, 2010 9:18am Oct 28, 2010 9:18am
I just looked Mamood's previous post/chart a little more carefully, and still agree with the notion of lightening up if you see candle formations that indicate a slowing of the pulse.

I appreciate the approach of adding to positions on 5M candles as indicated, but I add to positions using a different approach. I did not want to state that I follow what was posted, but I do find it interesting. Do not want to sound like the big-man-trader or anything.

Again, thanks for your post and you hard work here Mamood.
  • #19,958
  • Oct 28, 2010 9:27am Oct 28, 2010 9:27am
Quoting GEfx
[...]

I appreciate the approach of adding to positions on 5M candles as indicated, but I add to positions using a different approach. I did not want to state that I follow what was posted, but I do find it interesting. Do not want to sound like the big-man-trader or anything.

[...]
Hi GEfx,

your comments are very welcome.
I know that big-man-trader problem very well.
One of the reasons, why I was hesitating to present such ideas in the past....

I have to say, that I add to my positions a little different too.
But the idea posted above was just published to make it more easy to add to positions, when you have still problems to do so. As I have said, to master fti's teachings we have to go beyond such a rigid approach ....

Cu,
Niels
  • #19,959
  • Oct 28, 2010 10:12am Oct 28, 2010 10:12am
Quoting MaMood
Hi Ray,

ok, from hindsight everything is much easier. But you may read one of my postings frokm this morning, where I was talking about the Lodon opening (http://www.forexfactory.com/showpost...ostcount=19927)

Attachend is an image, that shows a possible rescue action.
I have done that as attack sequence this morning my my self.

Hope it gives you some hints ...
Thanks for this chart MaMood, this helps a lot. I have read FTI's teachings time and again but find myself struggling with the application. Too rigid? Not quick enough? Not dancing well enough? All true.
It looks like you approach rescue in steps, whereas my mistake I think is to leave the rescue troops in until the scout is rescued. Then a reversal in the market usually gets me in more trouble. Guess I have to get in and out over ad over until the job is done.
Alex
If only I knew then what I know now...
  • #19,960
  • Oct 28, 2010 10:13am Oct 28, 2010 10:13am
Quoting piccolo
I was up all night waiting for your post, lol. Just kidding.

Was up last night building aud/usd longs. Let's see if it wants to dive down again. Otherwise will add again.

Sorry man.........thought i will wait till weekend so i can put like a long time to give mindfull thought on it......

will do this weekend......


V

BTW: Where is FTI and i saw DutchAngel sometime ago...
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