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People say systems don't work (only pure price action does)

  • #41
  • Nov 18, 2010 3:40am Nov 18, 2010 3:40am
Quoting Mr J


Yes, but while the points of entry and exit are contrarian, the trader may actually spend most of the trade with the "majority".
To make any sort of profit of course he/she would have to for some time...

I dont know specific trade management tactics no... was just talking about the way a cotrarian (from what I was told) aproached a market and how they evaluate an entry price

You obviously know more about it than me... Carry on
Time hides Nothing
  • #42
  • Nov 18, 2010 3:48am Nov 18, 2010 3:48am
Contrarian




http://i.investopedia.com/inv/092009.../book_icon.jpg
What Does Contrarian Mean?
An investment style that goes against prevailing market trends by buying assets that are performing poorly and then selling when they perform well. '
Time hides Nothing
  • #43
  • Edited 5:31am Nov 18, 2010 4:51am | Edited 5:31am
Quoting CindyXXXX
Contrarian




http://i.investopedia.com/inv/092009.../book_icon.jpg
What Does Contrarian Mean?
An investment style that goes against prevailing market trends by buying assets that are performing poorly and then selling when they perform well. '
And if it's in investopedia then it must be the absolute truth. There simply is no room for other definitions or interpretations. Or maybe there isOUCH my brain hurts!!!

@beehivisjoe : IMO Using candlesticks, S/R lines, trend lines is same as using PA based system. Using bollinger etc. is same as using indicator based system. First one is discretionary second one isn't. First one would be very difficult to backtest, second one isn't.
I'd like to know the answer to second question too:

2) Are there any profitable traders that have been trading 3+ years profitably with the same strategy (not pure price action) but one that uses indicators as a main part of there strategY?
  • #44
  • Nov 18, 2010 6:04am Nov 18, 2010 6:04am
The lower the cost of entry, the more you have to be contrarian - think of housing vs FX. In a booming housing economy, everyone can ride the trend for a long time. In FX, theoretically everyone could too, but the low cost of entry encourages them all to jump ship extra early and sit back regretting lost profits.
  • #45
  • Nov 18, 2010 7:51am Nov 18, 2010 7:51am
Quoting YeahBaby
2) Are there any profitable traders that have been trading 3+ years profitably with the same strategy (not pure price action) but one that uses indicators as a main part of there strategY?
Yes, absolutely.
  • #46
  • Nov 18, 2010 10:33am Nov 18, 2010 10:33am
Quoting YeahBaby
And if it's in investopedia then it must be the absolute truth. There simply is no room for other definitions or interpretations. Or maybe there isOUCH my brain hurts!!!

@beehivisjoe : IMO Using candlesticks, S/R lines, trend lines is same as using PA based system. Using bollinger etc. is same as using indicator based system. First one is discretionary second one isn't. First one would be very difficult to backtest, second one isn't.
I'd like to know the answer to second question too:

2) Are there any profitable traders...
The answer to 2 is yes but after a while I think you will realise the indis are a distraction, all you will need is price action.
  • #47
  • Nov 18, 2010 10:57am Nov 18, 2010 10:57am
Still learning the ropes of trading and after 2 years of live trading and 90% of that time trading mostly PA, I'm starting to learn that Indies do have a place too (maybe this thought will change in a few years, who knows).

I'm currently using an Indie to define trend and then taking price action setups in that direction. So far it's been working well for me and I feel like I'm going more with the flow of the market. We'll see how it does in the long run, but right now I've been doing some of my best trading to date.

A contrarian would have been shorting the Case/Shiller Index while everyone was saying housing was in a new paradigm. A contrarian would have been selling is home / homes in 2005/6.
Don't wish it were easier, wish you were better. ~ Jim Rohn
  • #48
  • Nov 18, 2010 12:33pm Nov 18, 2010 12:33pm
Using some indies can be useful whether some of you PA priests like it or not.

For example, if you want to track/compare current market volatility, you can use an indicator that measures volatility and compare between different pairs/time frames, etc. The indicator in this instance will isolate that information and put it on a separate chart, making tracking and comparisons easier than just trying to look at naked charts and measure it by eye. Another example is using an indicator to measure trending vs ranging behavior, etc.

Just because you find such measuring tools useless/distracting doesn't mean it's useless to other people.

Just the same narrow-minded thinking patterns here...
  • #49
  • Nov 18, 2010 12:53pm Nov 18, 2010 12:53pm
let me be the "contrarian" here, and unlike most of the other members, not post something off-topic:

there are many reasons why most "systems" fail:

1. the system developer has curve-fitted his system to the past few months/years data...and the markets may change in the future, rendering his system useless...
-----------------------------------------------------------------
2. most systems at the trading systems forum look like this:

Buy when all the below conditions are met:
Indicator 1: goes above 50
Indicator 2: turns green
Indicator 3: Pink line goes above orange line
Indicator 4: plots a buy arrow
EMA 5 crosses EMA 13
Price moves above EMA 13
etc etc...

firstly, do we really need 10 different indicators occupying our whole screen...making it impossible to see what price is actually doing?

instead of understanding the calculations/logic behind the indicator, or what the indicator is "indicating" by acting in a particular way, most people just set arbitrary "rules" regarding when to buy/sell based on what the indicator is doing...is it a surprise that they fail?

pls don't misconstrue the above as indicator-bashing...people do use indicators succesfully...
  • #50
  • Nov 18, 2010 1:11pm Nov 18, 2010 1:11pm
Quoting Marv
Using some indies can be useful whether some of you PA priests like it or not.

For example, if you want to track/compare current market volatility, you can use an indicator that measures volatility and compare between different pairs/time frames, etc. The indicator in this instance will isolate that information and put it on a separate chart, making tracking and comparisons easier than just trying to look at naked charts and measure it by eye. Another example is using an indicator to measure trending vs ranging behavior, etc.

Just because...
Marv you obviously know your stuff mate and I have great respect for you for that.

But please chill on the condescending bad attitude and generalisations.

I agree with both the previous posts that indis do have a place and can be useful for quick eyeballing of potential setups. All I know is I have spent years working through a ton of indis and bit by bit they become a waste of space.
  • #51
  • Nov 18, 2010 1:28pm Nov 18, 2010 1:28pm
Quoting Dopey
At one time, virtually everyone in the world believed the world was flat and that you would fall off the edge.

At one time, the vast majority of Germans believed that Adolph Hitler was good for Germany.

At one time, the vast majority of people believed the earth was the center of everything and that the sun orbited it.

At one time when I decided to sell everything I own and go live in Turkey, everyone I knew, except my mother, told me it was mistake and that I would regret it. Twenty-three years later I'm still living abroad and I've lived...

First Turkey, then the UAE? Wow.
  • #52
  • Nov 18, 2010 1:41pm Nov 18, 2010 1:41pm
Quoting jag1966
Marv you obviously know your stuff mate and I have great respect for you for that.

But please chill on the condescending bad attitude and generalisations.

I agree with both the previous posts that indis do have a place and can be useful for quick eyeballing of potential setups. All I know is I have spent years working through a ton of indis and bit by bit they become a waste of space.
Agreed, and my apologies for the attitude.
  • #53
  • Nov 18, 2010 2:08pm Nov 18, 2010 2:08pm
Quoting Marv
Agreed, and my apologies for the attitude.
Thanks, happy trading buddy.
  • #54
  • Edited 6:26pm Nov 18, 2010 5:52pm | Edited 6:26pm
Quoting YeahBaby
And if it's in investopedia then it must be the absolute truth. There simply is no room for other definitions or interpretations. Or maybe there isOUCH my brain hurts!!!
Investopedia and any other financial book you will read... Its a freaking word and thats its meaning... sheesh.
Time hides Nothing
  • #55
  • Edited 12:44am Nov 19, 2010 12:16am | Edited 12:44am
why?
all indicators are simply reflection of price

im a noob with 1month of starting forex, but when i first started i thought systems was the shiz, Trying all kinds, i had all these indictors up and i was basing my trades on what 4 or 6 indicators was saying.I WASNT EVEN LOOKING AT CANDLES. i was so confused i stripped EVERYTHING and made the chart naked, zero indicators.

im forcing my self to learn to ride with out training wheels from the start=)

any noob starting from a "system" will really be trading blind, and eventually it will be their downfall
systems can work well for those who know how the market moves, but are they really needed?

price action works in any market, range or trend,

if you need an indicator to show you a trend, or a ranging market maybe you should learn more


price action is a system it self with infinite learning possibilites
"systems " have limits

im now realising markets arnt a random chaos of events at all, a simple trendline, and breakout confirmation can get you in, on a long trend. fakeouts, ranging market bounces also can be indicator free there all one needs to make pips, and have great risk to reward ratios

a simple naked chart with a breakout, followed by a bounce is all you need to be succesfull


dont confuse the confusion
-CATFOOD
  • #56
  • Nov 19, 2010 9:09am Nov 19, 2010 9:09am
Quoting Dopey
At one time.....
Really, how much more evidence does one need to finally understand not to listen to what the majority says? If the majority says "baaaa", then you should be barking.
Moms have faith in their kids.... & often they are right.

haha... i love outliers.
Thanks for sharing your story.

Quoting fxterrapin
First Turkey, then the UAE? Wow.
i think these are just 2 of the many countries he's been to.
  • #57
  • Nov 19, 2010 9:41am Nov 19, 2010 9:41am
Quoting Catfood
why?
all indicators are simply reflection of price

im a noob with 1month of starting forex, but when i first started i thought systems was the shiz, Trying all kinds,...
Wow, all that in 1 month, huh? Amazing.

Nice first post, welcome. LMAO.
Don't wish it were easier, wish you were better. ~ Jim Rohn
  • #58
  • Nov 19, 2010 4:43pm Nov 19, 2010 4:43pm
Quoting CindyXXXX
This thread is ridiculous

"People say systems dont work only pure price action does"

What people? What systems?

Such a generalised statement... Secondolly do the people that say this know all there is to know about the possibilities in the market with either system?

Ridiculous....

Its hard to have a civilised conversation on this forum these days... Nothing grows here just endless circles of nothingness, it increasingly seems like another language that is written here, and that is the language of confusion...

Questions are so open...
I assume you're one of us (the not good enoughs) since you're still here? We may not be good enough as you said, but that is exactly why people are having a healthy discussion here on how to get better. There is no reason to disrespect a bunch of people learning together. And yes, thanks for the definition of 'contrarian' you managed to dig up from Investopedia, that sure helped a lot.
  • #59
  • Nov 19, 2010 4:53pm Nov 19, 2010 4:53pm
Quoting zenkh
I assume you're one of us (the not good enoughs) since you're still here? We may not be good enough as you said, but that is exactly why people are having a healthy discussion here on how to get better. There is no reason to disrespect a bunch of people learning together. And yes, thanks for the definition of 'contrarian' you managed to dig up from Investopedia, that sure helped a lot.
Actually I just need to get a life but dont mind me. No I have not reached my goals in trading yet but Im oh so close. I come on here whilst I m studying, which is quite a bit as its a great place to procrastinate

Your twisting my words I didnt say "not good enoughs" I was just saying that people just seem so lazy these days they cant do the due dillegence they expect to walk into the most competitve cut throat and rewarding business arena on the planet and come to a forum and have it handed to them on a plate (not talking about the OP). It seems to get worse by the day. The good guys are driven away and yes you have a point sometimes I should just keep my mouth shut. that was actually quite a rant. I still think this thread is ridiculous. Theres just no answer to that question really but anyway

Apologies to the OP it wasnt actually all aimed at him/her. ah i dunno. Perhaps I will leave very soon.

Point taken.
Time hides Nothing
  • #60
  • Nov 19, 2010 5:08pm Nov 19, 2010 5:08pm
Just want to add that I distinctly remember coming onto Forex Factory 3 months after dicovering trading and being keen and eager. I would post things and say things and then some 10V (was 10K at the time) would come on and take the piss out of me or just be a rude prick. and looking back they werent really trying to offend me, they were just cutting the BS and telling it how it was. If I had actually listened to some of the things they told me back then it might have saved me many hours of trial and error but being optimistic and not properly aquainted as to how this all goes I just didnt listen to them and thought they were just grumpy old fkers who never made it.

This couldnt be further from the truth but its just what I wanted to believe at the time... and so I did. It was much easier to believe the crap in the trading systmes thread about the people making `100 pips a day with their moving average system or whatever.
Time hides Nothing
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