Price action is dumb, and you're lazy for thinking otherwise | Forex Factory

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Price action is dumb, and you're lazy for thinking otherwise

  • #1
  • First Post: Jul 25, 2011 1:52pm Jul 25, 2011 1:52pm
Well

Now that I have your attention hear this: Using price action as a method of entry/exit is ridiculous, You can't use a single variable to predict itself. Technical analysis falls under the same category of invalidated trading.

Every trader I have talked to who is a technical trader has been unable to answer this one simple question:

Why does you system work?

I can tell you exactly why the way I trade is the way I trade. I can tell you why it works, the principals it is based off of, and why it will remain robust. Every move I make is based in logic.

So go ahead, all those who have been offended by my "out there" claim, please prove me wrong...

Counter point?... Go!
  • #2
  • Jul 25, 2011 2:00pm Jul 25, 2011 2:00pm
Quoting superdezign

I can tell you exactly why the way I trade is the way I trade. I can tell you why it works, the principals it is based off of, and why it will remain robust.
I'm all ears. Fire away!
  • #3
  • Jul 25, 2011 2:05pm Jul 25, 2011 2:05pm
Hmmmm

Can't tell you that buddy, but what I can say is this... Ignore nothing, but at the same time put your complete faith into nothing...

Everything is important, even price action as dumb as it is has some weight to it. I look at everything, but I assign different weights to everything, and I always do my best to break it all down to a very basic level of logic, to understand why this/that impacts the market, if it has any impact at all.

Always ask "why!"
  • #4
  • Jul 25, 2011 3:05pm Jul 25, 2011 3:05pm
Hmmmm

so you want us to tell you why our systems work but you won´t tell us why yours work....

why should we?
  • #5
  • Jul 25, 2011 3:11pm Jul 25, 2011 3:11pm
Quoting superdezign

I can tell you exactly why the way I trade is the way I trade. I can tell you why it works, the principals it is based off of, and why it will remain robust. Every move I make is based in logic.

...


Quoting superdezign

Can't tell you that buddy
Quoting superdezign

Always ask "why!"
Why?
  • #6
  • Jul 25, 2011 3:23pm Jul 25, 2011 3:23pm
I dont want anyone's system, please keep them to yourself.

I would never share mine, since I have been developing it for 5 years. I have spent thousands of hours testing it, developing theories, I even taught myself calculus.

I was just wondering if anyone actually understands what they are doing, what they are exploiting, or if they even know the basic math behind what they are doing.

I talked to a guy the other day, he went on and on about how awesome his system was. He mentioned that he used the RSI...

Which had me stop him right there.
"Wait, you use indicators?"

It is one thing to use indicators, and it is an entirely different thing to know nothing about them.

"Can you even tell me, what RSI is?"
"It uhh measures the relative strength"
"Of what?"
"I.. I don't know"

He couldn't even tell me begin to tell me how it worked...

Gross... (and this guy is interning at a hedge fund)

I think most technical traders are the same way. They use these indicators because they work sometimes, for a while, before their parameters are no longer optimized to the volatility of the markets, then chalk it up to it needed tweaking, bla bla bla... lather, rinse, repeat

I think indicators are just a crutch for people who don't understand math, finance, or economics. They want to make money, and indicators are the push button way to start trading.

So, I am putting it out there... I don't want your systems, I dont want you to explain to me how you trade... I just want to know.. Do people get the logic behind their systems or do they just blinding follow the doji stars to the poor house?
  • #7
  • Jul 25, 2011 3:34pm Jul 25, 2011 3:34pm
Quoting superdezign
Well

Now that I have your attention hear this: Using price action as a method of entry/exit is ridiculous, You can't use a single variable to predict itself. Technical analysis falls under the same category of invalidated trading.

Every trader I have talked to who is a technical trader has been unable to answer this one simple question:

Why does you system work?

I can tell you exactly why the way I trade is the way I trade. I can tell you why it works, the principals it is based off of, and why it will...
Well you question may have confused them.

The types of technical trading setups i trade does have a logic behind them like for example Pin bars. If you look into orderflow, you can see the logic behind why could a pin bar setup work.
.
  • #8
  • Jul 25, 2011 3:40pm Jul 25, 2011 3:40pm
Quoting superdezign
Why does you system work?
I'm a technical trader. My system works because of kurtosis.
  • #9
  • Jul 25, 2011 3:56pm Jul 25, 2011 3:56pm
@nasir.khan

Haha thanks for the grammatical correction,

Havent slept in a few days..

As for the pin bars... They mean literally nothing. They would mean something if every market participant was staring at the same chart at the same time and we made all our decisions on the spot, but that is not how it works.

I have studied order flow, for a long time actually... and I found that it is too arbitrary to base a system on. Please prove me otherwise!

@Razzle

Now we are getting somewhere.. kurtosis.. somehow I get the feeling that this gets off to "orderflow" as well, which again, it's too arbitrary..
  • #10
  • Jul 25, 2011 4:04pm Jul 25, 2011 4:04pm
Quoting superdezign
Well

Every trader I have talked to who is a technical trader has been unable to answer this one simple question:

Why does you system work?
It sounds like you have only been talking to failed traders.
Price action setups are easy to rationalize. And if used in context to other market variables, they do work.
And indicators are not price action. They are a result of past price action (or volume/whatever variable). Not understanding these is irrelevant to someone understanding math/economics/finance. Being good at math won't help you understand human psychology...any quant will tell you that.
  • #11
  • Jul 25, 2011 4:05pm Jul 25, 2011 4:05pm
Quoting superdezign
Well

Now that I have your attention hear this: Using price action as a method of entry/exit is ridiculous, You can't use a single variable to predict itself. Technical analysis falls under the same category of invalidated trading.

Every trader I have talked to who is a technical trader has been unable to answer this one simple question:

Why does you system work?

I can tell you exactly why the way I trade is the way I trade. I can tell you why it works, the principals it is based off of, and why it will remain robust. Every move I make is...
THIS
Congratulations ScalaFX for coming out of the closet!
  • #12
  • Jul 25, 2011 4:09pm Jul 25, 2011 4:09pm
Quoting superdezign
Hmmmm

Can't tell you that buddy, but what I can say is this... Ignore nothing, but at the same time put your complete faith into nothing...

Everything is important, even price action as dumb as it is has some weight to it. I look at everything, but I assign different weights to everything, and I always do my best to break it all down to a very basic level of logic, to understand why this/that impacts the market, if it has any impact at all.

Always ask "why!"
This post raises some points.

1. You're either being too ambiguous because you wish to sell a system
2. This is an exercise in "ego" stroking

But the question is, why?
Searching for a cure...:nerd:
  • #13
  • Jul 25, 2011 4:17pm Jul 25, 2011 4:17pm
Quoting superdezign
Using price action as a method of entry/exit is ridiculous, You can't use a single variable to predict itself
So price action is a single variable?

I'm sure you have some interesting things to share, but if your top secret formula is too dangerous...
  • #14
  • Jul 25, 2011 4:17pm Jul 25, 2011 4:17pm
Lovin this guys, keep it going!


@qwerty00

Past price action is price action. Take a doji for example: it happens, you observe it, it is a collection of the trading of that past session (whatever it may be -- day, week, hour). Everything, be it technical analysis is made up of lagging information. Which makes it invalid information...

Another example for ya...
stock trades from 25 to 30, then retraces to 27... Who cares?
Once the stock reaches 30 again those same sellers arent going to be sitting up there with more massive orders. There are millions of variables (the market variables you referred to) that goes into a stock's movement that collectively are impossible to know them all, analyze them, quantify them, ect.

and yes human psychology is extremely important, but most people just spit out the words greed and fear without evening know what that means... And even if they do, most have no way to exploit it...

You're up! Go!

@nubcake

......What?
  • #15
  • Jul 25, 2011 4:19pm Jul 25, 2011 4:19pm
Quoting frankkn
So price action is a single variable?

I'm sure you have some interesting things to share, but if your top secret formula is too dangerous...
Ok.. my turn to use the quote button...

No.. Price is a single variable.. and that is all price action uses...

Counterpoint.. go...
  • #16
  • Jul 25, 2011 4:22pm Jul 25, 2011 4:22pm
Quoting funlovinj
This post raises some points.

1. You're either being too ambiguous because you wish to sell a system
2. This is an exercise in "ego" stroking

But the question is, why?
Nope, not selling a system..

This is simply an experiment.. I was curious as to if anyone actually knows how their system/methodology/whatever actually works.

My ego is already big enough, please dont touch it, it might explode.. I wont post results of my trades, ect.. Not looking for that type of validation..

I merely want to have a discussion with some like minded people (other traders).. pit wit against wit...

So, lets discuss fellas
  • #17
  • Jul 25, 2011 4:25pm Jul 25, 2011 4:25pm
Quoting superdezign
@nubcake

......What?
i like that you are addressing what so few can. "WHY?". usually the answer is some load of bull they made up to explain randomness.

so, when you say :

Quote
Why does you system work?

I can tell you exactly why the way I trade is the way I trade. I can tell you why it works, the principals it is based off of, and why it will remain robust. Every move I make is based in logic.

it warms my cold cold heart.
Congratulations ScalaFX for coming out of the closet!
  • #18
  • Jul 25, 2011 4:29pm Jul 25, 2011 4:29pm
Quoting superdezign
Ok.. my turn to use the quote button...
No.. Price is a single variable.. and that is all price action uses...

Counterpoint.. go...
Yeah, but can you color text as well.

Price is one variable, time is another variable.

Edit:

GO! lol
  • #19
  • Jul 25, 2011 4:43pm Jul 25, 2011 4:43pm
Quoting frankkn
Yeah, but can you color text as well.

Price is one variable, time is another variable.

Edit:

GO! lol
Sure thing

Yes time is a variable, and if you use time with price then you are a momentum trader

price/time = "price velocity"

But moments are fleeting, as are the people who shaped your candlestick the way it is...

Think of it this way...

today AAPL (thats Apple Inc for those of you who live under rocks) traded roughly 20 million shares... That could have been a handful of morons tossing their shares back and worth or millions of people trading around a few dozen shares each. Either way you have to consider that situation A and B are going to feed you information with varying degrees of "correctness".. and there is no way for you to determine which situation you are dealing with. Now, please, understand these are extreme situations, not actual examples of what can happen in a trading day, use your imagination.

Also, consider a stock like MSFT (microsoft)... Today it traded roughly 100 million shares.. now that sounds like a lot, but MSFT has over 8.4 BILLION shares out there... So you are letting a minor percent of the market participants decide what a good price to buy is for you??? No matter what situation from the last example occurs you aren't getting enough information to make an informed decision..

Your turn.. go
  • #20
  • Jul 25, 2011 4:43pm Jul 25, 2011 4:43pm
Quoting nubcake
i like that you are addressing what so few can. "WHY?". usually the answer is some load of bull they made up to explain randomness.

so, when you say :



it warms my cold cold heart.

Thank you nubs!
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