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Trend Lines Don't Work

  • #41
  • Jan 31, 2011 8:56pm Jan 31, 2011 8:56pm
Quoting GEfx
OK, after saying you would not define "works", you provided one, so thanks for making that clear. Here is how I (I may be delusional) always think of it: the trend line is a graphical/mathmatical representation of the market's supply and demand mechinism, within a specific time frame. The trend line does not "work", but the supply/demand mechanics do, until they no longer work, which is when the line "fails". I never think of it as a trend line working, but as a stable bid/ask environment, but when players start to pull out, the environment...
Ok,

see idk.. it might just be me.. but atleast you have some idea as to what your doing.. I like this thinking and its a good concept IMO but who the hell am I right.. the guy who says trend lines don't work

but hey.. now you have said it yourself.. you have defined when they work and when the fail.. so a solid view of them working and not working
  • #42
  • Jan 31, 2011 8:57pm Jan 31, 2011 8:57pm
For those who want correct trend lines..

I heard a few saying that I am drawing them wrong?

ok I starting doing all mine manually

y = mx + b

ok



thats the only joke I've made so far... hope someone gets that joke :-p
  • #43
  • Jan 31, 2011 9:05pm Jan 31, 2011 9:05pm
Quoting newyear498
There is no "i know something you dont"

because, I do not know what you know or don't know...

I am gathering information however that the majority of people support trend lines without knowing why they themselves have a personal concept of how and why they work.

Its pretty insightful.. well to me atleast
Quoting newyear498
I made an honest effort to share some logical thinking with this thread
Really? You have shared nothing of any factual or logical value that I nor anyone else can find. You're being an ass, and you're choosing to pontificate and lead people around by the nose. Some recognize it, others don't.

FF is build on the good will to help and assist others, as well as learn; you instead have chosen to lure people into a discussion and then disparage against their supposed lack of something you've been grossly unclear and unfair on.

I vaguely recall your opening post and you were not initially asking "how or why they work" but were instead whining that you have been trading for years and that they have never worked for you; yet, as of (my) writing this, that opening post is 10 hours old, yet it was edited 4 hours ago. You removed the premise of your original post and are now berating people because of your original vagueness.

There is a long list of reasons why trendlines sometimes do and others times do not work. And sometimes, an unexpected black swan cause surfaces. Thus, I am quite certain that your supposed nugget of information does not encompass all the reasons; you have made yourself out to be smarter than everyone else, yet I assure you there are others who are wiser.

Perhaps you will share your holy grail of trendlines for the few remaining followers once you get off your philosophical and quite immature soapbox. In the meantime, spare us, and ideally ban at least me from this waste of time and quite lame thread.
  • #44
  • Edited Feb 1, 2011 12:55am Jan 31, 2011 9:12pm | Edited Feb 1, 2011 12:55am
Quoting newyear498
For those who want correct trend lines..

I heard a few saying that I am drawing them wrong?

ok I starting doing all mine manually

y = mx + b

ok



thats the only joke I've made so far... hope someone gets that joke :-p

not sure what you're driving at exactly dude, but i laughed>>>> http://en.wikipedia.org/w/index.php?...Bb&redirect=no man wouldn't it be nice if price just went in a straight line all the time? LOL

Edit: Interesting topic..... but errr...good luck with this thread man LOL
  • #45
  • Jan 31, 2011 9:25pm Jan 31, 2011 9:25pm
As per your request, I have attached four e-mini Euro charts from today. Times are in Central Standard Time. These charts are my adjunct charts, which have only specific indicators. The corresponding charts (not shown) have the candlesticks, and several moving average lines. All charts have one minute, three minute, and some thirty-second bars.

The Bollinger Bandwidth is the third set from the top (marked “BBW”). The times shown within the parenthesis are irrelevant to this discussion and are not indicative of the indicator period shown within that set.

The set up occurs when the purple (one minute) line and the aqua (thirty second) line start ascending through the dashed four-tick line (as marked with a vertical blue line). The movement (long or short) direction is forecasted (indicated) by the other indicators. While I am over simplifying this, you will generally find a minimum of one cycle per hour (while the S&P pit is open, NOT off-hours).

Two or three ticks, and I’m out.







Quoting dragan53
can u link us to ur bolinger band
Attached Image(s) (click to enlarge)
Click to Enlarge Name: ii1.jpg Size: 82 KB
Click to Enlarge Name: ii2.jpg Size: 86 KB
Click to Enlarge Name: ii3.jpg Size: 76 KB
Click to Enlarge Name: ii4.jpg Size: 81 KB
memores acti prudentes futuri.
  • #46
  • Jan 31, 2011 9:31pm Jan 31, 2011 9:31pm
Does gravity work?
I don't know.
I don't care, as long as I don't fall off the earth.
Any Einsteins in the area?
Or was it Newton?
  • #47
  • Jan 31, 2011 9:37pm Jan 31, 2011 9:37pm
wheres the price line?
is it the thin black one ,thats always in line with the price number
  • #48
  • Jan 31, 2011 9:46pm Jan 31, 2011 9:46pm
Duh.

I forgot to clarify that the BBW is NON-DIRECTIONAL and NON- DISCRIMINATORY. The “dip” has no bearing on the up-coming direction.

Also, it is strictly a coincidence that all four charts show “long” trades. It was just the time frame that I used.




Quoting bfs
As per your request, I have attached four e-mini Euro charts from today. Times are in Central Standard Time. These charts are my adjunct charts, which have only specific indicators. The corresponding charts (not shown) have the candlesticks, and several moving average lines. All charts have one minute, three minute, and some thirty-second bars.

[font=Times New Roman][size=3]The Bollinger Bandwidth is the third set from the top (marked “BBW”). The times shown within the parenthesis are irrelevant to this...
memores acti prudentes futuri.
  • #49
  • Jan 31, 2011 9:50pm Jan 31, 2011 9:50pm
interesting ,good luck in that
  • #50
  • Jan 31, 2011 9:53pm Jan 31, 2011 9:53pm
you said:
"I have over a while learned why trend lines do APPEAR to work 70-80% of the time.. but I have notice why they really don't.. and what is causing them to look like they work.."

70 to 80 percent is pretty good. I will take 8 out of 10 trades any day.
  • #51
  • Jan 31, 2011 9:59pm Jan 31, 2011 9:59pm
trendlines are just a tool to help , not to tell us where to trade,but to give us sort of s/r point from the past levels into now,
  • #52
  • Jan 31, 2011 10:07pm Jan 31, 2011 10:07pm
how would a diagonal trendline work as any sort of s/r though? Past performance from a trendline shouldnt be able to give foresight to future prices.
  • #53
  • Jan 31, 2011 10:13pm Jan 31, 2011 10:13pm
i think what you are asking is "is the black line in the BBW area a price number?" no, that line is the three-minute BBW. these BBWs are 10 periods and 1.25 standard deviations (works for me and is not cast in stone).

closing prices appear as dots in the fourth area down and crosses in the bottom area. they are used only as reference points to the overlaying indicators. for price action, i use the candlesticks.

i have attached one candlestick (main) chart. the vertical blue line corresponds to the blue line on the previous post: chart ii1.




Quoting dragan53
wheres the price line?
is it the thin black one ,thats always in line with the price number
Attached Image (click to enlarge)
Click to Enlarge Name: ii1a.jpg Size: 112 KB
memores acti prudentes futuri.
  • #54
  • Jan 31, 2011 10:57pm Jan 31, 2011 10:57pm
Quoting Beljevina
Really? You have shared nothing of any factual or logical value that I nor anyone else can find. You're being an ass, and you're choosing to pontificate and lead people around by the nose. Some recognize it, others don't.

FF is build on the good will to help and assist others, as well as learn; you instead have chosen to lure people into a discussion and then disparage against their supposed lack of something you've been grossly unclear and unfair on.

I vaguely recall your opening post and you were not initially asking "how or why they work"...

Your absolutely right.. understanding why things work is totally lacking logical value... doing things you don't understand makes logical sense...

your post is so funny because you said I changed my original post and everything.. I believe I edited a few grammatical errors.. but I don't see the point in arguing with someone who sees no value in seeking to understand the world around them and building on the human element that has separated us from the rest of the animal kingdom...
  • #55
  • Jan 31, 2011 10:59pm Jan 31, 2011 10:59pm
I think you asked your question wrong, on two counts.

First, to say "Trend Lines Don't Work" puts you in the position of a missionary who enters the native village and proclaims "Your gods are false, and your elders have deceived you", with or without the implicit "...and I know the only path to truth." The New World was littered with the bones of guys who used that tactic, and the successful ones were, e.g., the ones who were celebrated, into the modern era, with things (in Arizona, true fact) like the Easter passion play where Pontius Pilate was portrayed as a chief of an enemy tribe.

Second, I would suggest the right way to ask the question is: "Can you write down the rules, to draw a trend line, in such a way that a computer programed with those rules would always draw the same line as you on the same price graph? Not a moving average, not an oscillator, or other mathematically defined function of a sequence of past prices, but as straight lines, connecting certain critical points top and bottom."

Many would take up that challenge, and demonstrate for themselves that it ain't so simple and scientific after all, what with all the exceptions and special cases. Thereby, the conclusion comes that it is, at best, an art, and at worst, an exercise in the distinctively human, high-intellect ability to resolve ambiguity and recognize pattern though or in randomness. Our innate ability to do that is a big part of what makes traders successful, even as it is used in those anti-bot "write the letters you see" boxes on web pages that virtually no OCR program can consistently recognize successfully.
  • #56
  • Jan 31, 2011 11:27pm Jan 31, 2011 11:27pm
Quoting OldQuant
I think you asked your question wrong, on two counts.

First, to say "Trend Lines Don't Work" puts you in the position of a missionary who enters the native village and proclaims "Your gods are false, and your elders have deceived you", with or without the implicit "...and I know the only path to truth."...
Hey OQ,

your certainly right.. the way I presented the subject has come off horrible in all aspects

Oh well.. I guess what I was mostly interested in is to see others who have found a reason not to use trend lines and found understanding (for whatever reason) why they do not work .. and by work it should be common since I am referring to the way traders use them..

of course many wish to complain on the way traders use them is so vast but its not.. go through FF they are used the same way.. with expectations of price bouncing and if on a breach it will reverse direction

I don't mind being met with so much resistance.. I personally feel many disagreeing with me for going against the age old trend line is a good thing in many aspects


Its annoying having 80% of people on FF think I'm some troll with no purpose.. but what can I say.. if 80% don't have any desire to seek and understand the underlying causes and effects of the very methods they trade... then those individuals go against my entire reasoning of life as well as trading.. I'll do my best to continue avoiding influence from them.. I'm on my lonely journey as an introvert
  • #57
  • Jan 31, 2011 11:37pm Jan 31, 2011 11:37pm
This thread is creepin' me out man!!!!!!!!
  • #58
  • Jan 31, 2011 11:52pm Jan 31, 2011 11:52pm
Quoting EmeraldEyes
how would a diagonal trendline work as any sort of s/r though? Past performance from a trendline shouldnt be able to give foresight to future prices.
its visiting past levels liek supply and demand,
but im not sure ,because i dont use them much,.mostly in usdcad to draw sideway channels like now in 1h
but we can see this with our eyes,but even better with trendlines
  • #59
  • Jan 31, 2011 11:56pm Jan 31, 2011 11:56pm
Quoting newyear498
Its annoying having 80% of people on FF think I'm some troll with no purpose
I think that's probably hyperbole, but anytime anyone posts anything much outside the lowest common denominator, here or anywhere, there are others who will give them sh!t for it.

Quoting newyear498
I'll do my best to continue avoiding influence from them.. I'm on my lonely journey as an introvert
One of the things that makes retail forex the greatest market in the world is it is totally democratic. On the Street, or in the City, everyone is either smart as hell, highly educated, mentored, raised in the business, and often a combination of those things. Very undemocratic.

In online forex, somebody can be the total opposite of all of those attributes, and be successful. And then their conclusion -correct, in their case, prima facie- is you don't need any of those attributes.

Don't avoid influences; observe things. Part of the democracy is you don't have to use anything you see or hear, or believe any of it if you have reason to deny it, but every so often you'll see something that you never thought of, and that's worth the price of admission.
  • #60
  • Edited 12:29am Feb 1, 2011 12:10am | Edited 12:29am
I happened to be perusing the book, 'diary of a professional commodities trader.' According to the book, he's been successful for the last 15 years trading commodities and forex. Although I have for the most part been in the random camp and prefer quantitative systematic approaches (over full discretionary), it gave me some pause.

He completely used TA patterns-- BUT did not ascribe the majority of his success to the patterns themselves; rather, he put most of the rational to how he manged his trades, entry and exits, and money. As a strong counter argument to the norm, he emphasized on several occasions that his hit rate was something like 30%, and taking many losses with the occasional home runs (positive net expectation of course) was the catalyst to his success. That's the essence of trend trading with lognormal price distributions... a few home runs and a lot of flat to negative trades.

I would argue that you could take the same logic and apply it to random walks (+ drift of course) for what it's worth; but the upshot is that all of the conventional geometry based TA approaches are simply references; it's how you utilize the references (build your rules around them) and stick to the rules that work (revising when they don't) that determines a large portion of success or failure.
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