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Technical Analysis Fallacy

  • #29,001
  • Nov 16, 2011 8:55am Nov 16, 2011 8:55am
Quoting fti
watch that rogue trader defending the 13500
now at 13480
its traders like this when the flood gates opens on them
they cannot find a rock to hide under
thats why markets over shoot
imagine he need cut loss in vacuum

traders like trade against natural flow.
they create manipulated volatility
Chief, if you don't mind me asking, what do you mean by vacuum? Price levels with zero orders? And why would he need to cut lost under such circumstances?

Regards
  • #29,002
  • Nov 16, 2011 9:19am Nov 16, 2011 9:19am
I'm guessing this is the worst case scenario whereby there is little trading and all of a sudden some big news report comes out. The way I see it, a report against his position would create such a vacuum.
  • #29,003
  • Nov 16, 2011 9:36am Nov 16, 2011 9:36am
Quoting Atomic_Sheep
What does a tearing euro cable mean? I just see a sideways moving market with a desire to move lower at some point?
Hi Atom,

Based on the timing of fti's post, I believe that the blue box is the cable eur tear that he was referring to. Under normal market conditions, they are in sync. When one pair suddenly deviates from the other, it will be tearing away. That's how I understand it. You can open up the cable eur 5m chart and you will see the same movement. Something to do with romancing the 3 kingdoms in fti's earlier posts. However, I am still learning to dance with one lady, so haven't really venture into that part yet.

As for why it's a trap, I am not up to mark to ans. Perhaps fti or some experienced seniors would care to elaborate.

Attached Image (click to enlarge)
Click to Enlarge Name: eu.jpg Size: 250 KB


maybe by trap, fti meant that it was a fake rally in EU as the overall sentiment is still pointing down... so if one is nimble, one could sell the tops. Just my educated guess.
regards
  • #29,004
  • Nov 16, 2011 9:38am Nov 16, 2011 9:38am
Quoting Atomic_Sheep
I'm guessing this is the worst case scenario whereby there is little trading and all of a sudden some big news report comes out. The way I see it, a report against his position would create such a vacuum.
Hi Atom,

Thanks for your reply. I can understand that the market may produce very directional moves upon news releases... but what is the definition of vacuum? I'm really not sure if I fully comprehend...

regards
  • #29,005
  • Nov 16, 2011 9:46am Nov 16, 2011 9:46am
Thanks, N_Trader, I certainly noticed it at the time but I didn't recognise it as anything special. I did have a gut feel that EUR/GBP was being purchased over the main, but I couldn't classify this move as market manipulation. I had a feeling a feeling that something wasn't normal, but certainly no clue as to how to take advantage of the situation.
  • #29,006
  • Nov 16, 2011 9:54am Nov 16, 2011 9:54am
I think what he means by vacuum is, let's say he's short in an uptrend, if news comes out and its positive for the uptrend, everyone is buying which basically means that he's got massive competition to exit his shorts and market execution results in massive slippage or prices getting sucked up from where there is no selling pressure to where people actually start to sell at which point the vacuum disappears. So I think that what is meant by the vacuum is an area whereby there is no opposing pressure to the trend.
  • #29,007
  • Nov 16, 2011 9:54am Nov 16, 2011 9:54am
Quoting Atomic_Sheep
Thanks, N_Trader, I certainly noticed it at the time but I didn't recognise it as anything special. I did have a gut feel that EUR/GBP was being purchased over the main, but I couldn't classify this move as market manipulation. I had a feeling a feeling that something wasn't normal, but certainly no clue as to how to take advantage of the situation.
You are welcomed Atom I am not experienced myself. Still climbing the learning curve slowly. I believe that is why fti always emphasize on practicing, practicing, practicing... we can learn all the theories, but market experiences and the abilities to actively manage our trades and react to ever changing market conditions can only be acquired through practicing.

Trade well my friend.

regards
  • #29,008
  • Nov 16, 2011 10:01am Nov 16, 2011 10:01am
Quoting Atomic_Sheep
I think what he means by vacuum is, let's say he's short in an uptrend, if news comes out and its positive for the uptrend, everyone is buying which basically means that he's got massive competition to exit his shorts and market execution results in massive slippage or prices getting sucked up from where there is no selling pressure to where people actually start to sell at which point the vacuum disappears. So I think that what is meant by the vacuum is an area whereby there is no opposing pressure to the trend.
Thanks Atom, I think I have a clearer picture now. I still don't understand why trader will rush to exit? Unless rescue is not probable? I would never run without a good fight. Unless the forces are overwhelming - i.e. CBs intervention.

regards
  • #29,009
  • Nov 16, 2011 10:14am Nov 16, 2011 10:14am
Well, firstly, I hope I'm not wrong in my understanding otherwise I'm just spreading incorrect information so definitely need to have this backed up by others . In terms of why not save it, well, the only logical reason is that if you are dancing with the market and you know you have no chance of saving it, then it would be silly trying to dig an already deep hole a little bit deeper i.e. the age old adage of building on loss positions and not taking profits. After all, if the market isn't going your way, there's no telling when it will make your saving trades pay off and by that stage your account would be bust anyway. At least this is the way that I see it. You are utilising various progressions to save your trades e.g. martingale or geometric progressions (same thing? sorry should know this by now, no excuses I know), but when you use these, you very quickly kill your account.

Fti said in early threads that when he was coaching his dealers, he would take over their books if they ran into large losses but he wouldn't try saving them after a certain point. Beyond this pointm the risk simply becomes ridiculous. I think after a 3rd or 4th saving trade the loss is booked?
  • #29,010
  • Nov 16, 2011 10:27am Nov 16, 2011 10:27am
Quoting Atomic_Sheep
Well, firstly, I hope I'm not wrong in my understanding otherwise I'm just spreading incorrect information so definitely need to have this backed up by others . In terms of why not save it, well, the only logical reason is that if you are dancing with the market and you know you have no chance of saving it, then it would be silly trying to dig an already deep hole a little bit deeper i.e. the age old adage of building on loss positions and not taking profits. After all, if the market isn't going your way, there's no telling when it will make...

what you said cannot be too far off i think. Seems rather quiet here. Hopefully someone would save us if we are heading for the oncoming train. lol.

I also remember that 200-300pips move is not too uncommon especially for major news. anything beyond that, it's probably better to call it quits i guess. Imho, I think most trades can be rescued. the key is in our skew and timing. personally, i'm still learning now, so i am using the most elementary sequence 1 1 2 for both rescues and attacks.

How long have you been doing this? IF you don't mind sharing

regards
  • #29,011
  • Nov 16, 2011 10:40am Nov 16, 2011 10:40am
I've been interested in forex for about 6 years, so certainly have a lot of screen time. Initially started with the whole holy grail search - indicators, robots etc (still pursue it out of curiosity) but mostly doing discretionary trading now. Started trading live about a year ago and full time about 2 months ago. Still not making a living of it but I feel like I'm getting really close. At least based on my experience I should be way past trading peanuts, however dabbling in it and trading full time are two entirely different things.

Can't say I'm comfortable with attempting to save trades at this point. Generally I simply bag the loss and proceed form there with the new direction. Most of the time, I make back what I have lost relatively quickly. Fighting protracted battles is not something I'm mentally capable of at this time. Too much over analysis.
  • #29,012
  • Nov 16, 2011 10:49am Nov 16, 2011 10:49am
Guys, i know it is boring, but study first part of the thread and practice... Teoretical thinking is OK, but imagine when your brain is overloaded by it... Overloaded by big amount of questions, sentences from class-students... Sorry to say...isnt it +/-(not all, but) useless? Regards
  • #29,013
  • Nov 16, 2011 11:27am Nov 16, 2011 11:27am
Quoting Fana
Guys, i know it is boring, but study first part of the thread and practice... Teoretical thinking is OK, but imagine when your brain is overloaded by it... Overloaded by big amount of questions, sentences from class-students... Sorry to say...isnt it +/-(not all, but) useless? Regards
No apologies needed Fana, I totally agree with you on the practice part. You have been thru what we are going thru, no doubt about it. Do bear with us if some of our questions sounds dumb

Sometimes, you just feel like talking to like minded traders. Not so much to ask questions, but just a form of interaction. Not sure if I'm making sense at all. Getting late, time for bed.

Good nite mate

Regards
  • #29,014
  • Nov 16, 2011 2:56pm Nov 16, 2011 2:56pm
thanks n thanks again for having time to share your xperience with everyone i dnt knw hw i find myself on this thread and since i did at 22:00 GMT+1 14th Nov. 2011 i been seriously studing the thread Page by page but dnt seem to follow (im sorry if dat sounds off).
Pls Fti where do i start though i have couple questions for u like;
1. i use a good indicator(i knw u dnt) that helps mi enter at gud positions but i realise i dnt really "dance" well so either lose heavily becos i dnt get out in time or profit well( only for heavy trend like gbp/usd i closed @ +93pips today). hw do i knw if to stay or exit a trade.
2. how do i determine high volatility periods
Pls i knw im way backwaard bt i have the passion to succeed in battlefields or "dancing with d queen". Also i must confess the thread to read are much can anybody help mi on relevant threads of FTI that will you think 'll b helpful.
I knw i mit b sounding really awkward pls do bear with mi.
Regards,
Chimz
  • #29,015
  • Nov 16, 2011 4:46pm Nov 16, 2011 4:46pm
dang
at last able square now.
exhaused
dang manipulations.
but nevermind, i won yes yes yes.
did you?

Inserted Video
  • #29,016
  • Nov 16, 2011 4:55pm Nov 16, 2011 4:55pm
Fti,

Can't say thanks enough for all the nuggets that you have shared and continue to share in spite of your health at this time. Your caring for us traders comes through. Very, very grateful.

Continuing to plow through your concepts etc.

Wishing you continued strength and recovery,

FX4
Trade what you see, not what you think or feel. Let the market come to you.
  • #29,017
  • Nov 16, 2011 5:05pm Nov 16, 2011 5:05pm
Quoting chimz
thanks n thanks again for having time to share your xperience with everyone i dnt knw hw i find myself on this thread and since i did at 22:00 GMT+1 14th Nov. 2011 i been seriously studing the thread Page by page but dnt seem to follow (im sorry if dat sounds off).
Pls Fti where do i start though i have couple questions for u like;
1. i use a good indicator(i knw u dnt) that helps mi enter at gud positions but i realise i dnt really "dance" well so either lose heavily becos i dnt get out in time or profit well( only for heavy trend like gbp/usd...
you are funny chap.
Ok lets see if i can.
You thinks weird. Why?
How can you not know how you find yourself on the thread?
Is like you made a girl pragnant , then nyou say you not know how it happened?
This itself tells me you have major mindset hurdle.
think about it.

1. if you insist use a good indicator, then what can i do help you?
I am my best indicator and i read the markets.
well no one knows when is time exit trades.or for the matter enter.
If we knew, what need suffer and monitor markets.
Just sell the house . If youknow when best time enter and exit, you will surely br multi billionaire very quickly.
Sorry i am not so fortunate know when stay or exit a trade.
when i am happy withthe profit i exit trades, or when is fuxed i cut loss. or when i am tired and cannot manage find the enegies anymore.

2. what type of question, is how do i determine volatility?
speed. speed against time. use eyes and brain.
is called eye brain co-ordination.

want ask you a question.
How do you determine, at what speed to move, to try kick an football thats coming at you?
you use eye brain and body co ordination. No?

ya, you wierd dud. but is ok, i like have all sorts friends.
ok is 7 am here i need get some sleep.


regards
  • #29,018
  • Nov 16, 2011 5:48pm Nov 16, 2011 5:48pm
Quoting fti
dang
at last able square now.
exhaused
dang manipulations.
but nevermind, i won yes yes yes.
did you?

http://www.youtube.com/watch?v=Kses3SfG-lU

YES
  • #29,019
  • Nov 16, 2011 7:42pm Nov 16, 2011 7:42pm
Hey guys. I heared singupare is very nice country for foreigners are ppl are nicer. here in kore they dnt like foreigners tht much. Otherwise I sprained my ankle yesterday on practice, I did stupid mistake as I want too much, but its n ot serious tht much. Otherwise I am going in seoul now this weekend so if anyone knows somebody there working at trading floor I would like meet guy see hw things work here. all best
  • #29,020
  • Nov 16, 2011 8:01pm Nov 16, 2011 8:01pm
Quoting chimz
thanks n thanks again for having time to share your xperience with everyone i dnt knw hw i find myself on this thread and since i did at 22:00 GMT+1 14th Nov. 2011 i been seriously studing the thread Page by page but dnt seem to follow (im sorry if dat sounds off).
Pls Fti where do i start though i have couple questions for u like;
1. i use a good indicator(i knw u dnt) that helps mi enter at gud positions but i realise i dnt really "dance" well so either lose heavily becos i dnt get out in time or profit well( only for heavy trend like gbp/usd...
Hi Chimz,

You should try reading the first 200 pages at least. Try not to rush your learning. Instead, let it come to you. There will be points that you won't understand straightaway. Nevertheless, persist on and do not be dishearten. If you truly seek, you will surely find

After your are done with first 100 pages, try out what you have learn on a demo acc. Always bear in mind the 3 most important ingredients to be successful. They were already presented in fti's first post - Market Structure, Capitalization and Mindset (YOU). YOU being the most crucial factor of success or failure in your trading endeavour.

Last but not least, I think you need to drop your indicators/stop loss if you wish to learn the Dance.

All the best my friend.

regards
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