The Problem with Technical Analysis

This is a discussion on The Problem with Technical Analysis within the Technical Analysis forums, part of the Methods category; Originally Posted by wisefoolx Momentum in Physics is a fact proven a million times over - in other words it ...

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Old Sep 15, 2017, 7:42am   #76
 
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Originally Posted by wisefoolx View Post
Momentum in Physics is a fact proven a million times over - in other words it is an objective standard of measure. Rsi is invented by wilder. I personally prefer to follow the objective laws of physics rather that some random idea.

But nothing to stop you using both if that's your cup of tea.
Momentum in physics is about the movement of physical bodies. Why should that have any relevance to something non-physical like the price of shares other than as a descriptive analogy?
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Old Sep 15, 2017, 7:59am   #77
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Originally Posted by wisefoolx View Post
Momentum in Physics is a fact proven a million times over - in other words it is an objective standard of measure. Rsi is invented by wilder. I personally prefer to follow the objective laws of physics rather that some random idea. But nothing to stop you using both if that's your cup of tea.
i currently don't look at RSI myself but if it interests me in future ill look at it again

ok so you use a physics equation of motion as an analogy to market movement, whatever floats your boat. if it works for you then that's great.
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Old Sep 15, 2017, 8:18am   #78
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i currently don't look at RSI myself but if it interests me in future ill look at it again

ok so you use a physics equation of motion as an analogy to market movement, whatever floats your boat. if it works for you then that's great.
Yes exactly , something that the trollers don't seem to want to get, as I play the copy and paste game with them. No one is putting a gun to anyone's head to use this or that indicator. We can do what we want.

But I prefer objective measures of standard not made up ones, at least as an addition to standard TA.
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Old Sep 15, 2017, 8:37am   #79
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Momentum in physics is about the movement of physical bodies. Why should that have any relevance to something non-physical like the price of shares other than as a descriptive analogy?
Welles Wilder seems to tell us the RSI is a measure of momentum, He is not saying it is anything else, but the only proven objective standard of measure is momentum in physics, not what he made up.

Though no one is forcing you not to believe him, however I would argue RSI is highly subjective. But whatever floats your boat. if it works for you then that's great

Also are you so sure movement of price is non physical ? Is it not a representation of the physical and physical as well, as least previously.
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Old Sep 15, 2017, 10:45am   #80
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Also are you so sure movement of price is non physical ?
For the clueless, price movement is economical not physical. Lager your bet, the faster it move against you. This is why I like to see you put down £30/point. This will teach you some real anti-gravity physics.
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Old Dec 11, 2017, 7:37pm   #81
 
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Wisefoolx's original post is interesting with some astute observations. My study of TA has led me to the conclusion that momentum is the only tradable advantage that the retail investor can exploit. But momentum is physics--pure and simple. RSI (and oscillators like it) are voodoo and yield results that are in no way related to momentum.

The inputs to my formula for relative momentum are % return in various time framed weighted toward the present. This is the “velocity” half of the equation. (Some people might call this “weighted alpha.”) The “mass” part of the equation is volume. (So far, this is all objective.)

This gives me relative momentum figures for the S&P, the market sectors, and the individual stocks in my watchlists. (Of course, how these relative figures are used to pick trades is largely subjective.)

The academics have speculated for years over why momentum works, with most of their conclusions related to investor psychology. The answer, I believe, is very simple. Momentum is an easy and objective way to quantify the trend. And the trend, as we all know, is your “friend.”
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