I appreciate that what I am about to post may be considered seditious and even treasonable but I find this adherence to the accuracy of Fibonacci may be no more than accidental and self-fulfilling. There i've said it now and I feel a lot better for it.
I fully appreciate that I am calling down the wrath of traders on my head or alternatively risk being ignored for the idiot that I appear to be - but I get the impression that the use of fibonacci is a movable feast. When events don't fit the fib numbers, simply move on to another set, sooner or later you are going to get a match and thus the system appears to be justified.
There is also the thought that with so many traders employing the system and trading in line with fibonacci forecasts it is enough to swing the result to the forecast and thus produce a self fulfilling result
I don't want to get into a discussion about the effacy of fibonacci but where are the physics to prove that a system derived to forecast rabbit populations is applicable to plant, growth, trading and logically everything else.
If anyone decides to reply to this post and is in disagreement with me, I urge you to be gentle with me after all I am an ex-lurker and deserve pity rather than castigation, yes castigation not the other word you may be thinking of.
Regards
bracke
I fully appreciate that I am calling down the wrath of traders on my head or alternatively risk being ignored for the idiot that I appear to be - but I get the impression that the use of fibonacci is a movable feast. When events don't fit the fib numbers, simply move on to another set, sooner or later you are going to get a match and thus the system appears to be justified.
There is also the thought that with so many traders employing the system and trading in line with fibonacci forecasts it is enough to swing the result to the forecast and thus produce a self fulfilling result
I don't want to get into a discussion about the effacy of fibonacci but where are the physics to prove that a system derived to forecast rabbit populations is applicable to plant, growth, trading and logically everything else.
If anyone decides to reply to this post and is in disagreement with me, I urge you to be gentle with me after all I am an ex-lurker and deserve pity rather than castigation, yes castigation not the other word you may be thinking of.
Regards
bracke
Bracke,
Fibs are maths, maths was not invented by mathamaticians but it is a natural law. Fibonnaci didnt invent the numbers he simply discovered them. Why it might work in trading leads to many possible answers but have you ever asked why does a trendline work? Is that self fullfilling? Guess it all comes down ones preference.
Fibs are maths, maths was not invented by mathamaticians but it is a natural law. Fibonnaci didnt invent the numbers he simply discovered them. Why it might work in trading leads to many possible answers but have you ever asked why does a trendline work? Is that self fullfilling? Guess it all comes down ones preference.
Bracke,
I'm all for differences of opinions.
I'm in the camp of price, price and price action
Practically everything else only has the potential to
mask the price action from the observer.
and I am easily deluded.
Also I question why a 14 period is any more logical than a 5, 34 or even a 236 period for a number of favourite indicators.
( for daytrading knowing which direction the 1 day SMA is going helps one stay the right side of the trend)
However, I am aware that a lot of trader use Fibs
and it would be foolish to be unaware of obvious
levels where these traders are watching.
Because markets are made up of people.
I am only interested if the market appears to respect one of these levels by showing me a new trend
But as they say whatever floats your boat,
but for me it has got to be so simple
such that my 4 year son can spot (i have said this before)
I'm all for differences of opinions.
I'm in the camp of price, price and price action
Practically everything else only has the potential to
mask the price action from the observer.
and I am easily deluded.
Also I question why a 14 period is any more logical than a 5, 34 or even a 236 period for a number of favourite indicators.
( for daytrading knowing which direction the 1 day SMA is going helps one stay the right side of the trend)
However, I am aware that a lot of trader use Fibs
and it would be foolish to be unaware of obvious
levels where these traders are watching.
Because markets are made up of people.
I am only interested if the market appears to respect one of these levels by showing me a new trend
But as they say whatever floats your boat,
but for me it has got to be so simple
such that my 4 year son can spot (i have said this before)
Hooya,
I also watch a select number of dealable FTSE 100/250 shares which i use to leverage any view on the underlying index.
As I have said before I have strong leaning towards the FTSE250 as it appears to give more obvious trends.
Lately, shorts in BAY, ICI, RTR and RR have been keeping the wolves at bay
I also watch a select number of dealable FTSE 100/250 shares which i use to leverage any view on the underlying index.
As I have said before I have strong leaning towards the FTSE250 as it appears to give more obvious trends.
Lately, shorts in BAY, ICI, RTR and RR have been keeping the wolves at bay
Here one of my simple charts with the 1 hour/1 day SMA and my straight lines.
I should pay homage to Bonsai for pointing me in the right direction.
Some people thrive on complexity- good on them.
But for me, being simple, it got to be uncluttered and no
distracting derivatives (indicators)of price action.
I make the one exception for SMAs, as they highlight the trend, if any.
I spent too long in the heart of the city where sophistry was taken to its highest form.
Far too clever minds could make you believe anything.
As an example EBITA was established as a method of accounting to justify technology ratings in 2000.
I should pay homage to Bonsai for pointing me in the right direction.
Some people thrive on complexity- good on them.
But for me, being simple, it got to be uncluttered and no
distracting derivatives (indicators)of price action.
I make the one exception for SMAs, as they highlight the trend, if any.
I spent too long in the heart of the city where sophistry was taken to its highest form.
Far too clever minds could make you believe anything.
As an example EBITA was established as a method of accounting to justify technology ratings in 2000.
Attachments
lol - bracke
markets hunt for volume of business to optimise the amount of trade.
that's what markets do.
if that occurs after a retrace of 50%, so be it
it will occur when traders enter or reenter the market.
self -fulfilling - no
it requires a critical mass to move markets and if you trade purely on fibs, you will often find yourself in the minority - and out of pocket-
The bears know about fibs just as much as the bulls - and they will tear your balls off if you get it wrong.
markets hunt for volume of business to optimise the amount of trade.
that's what markets do.
if that occurs after a retrace of 50%, so be it
it will occur when traders enter or reenter the market.
self -fulfilling - no
it requires a critical mass to move markets and if you trade purely on fibs, you will often find yourself in the minority - and out of pocket-
The bears know about fibs just as much as the bulls - and they will tear your balls off if you get it wrong.
Hooya
Not certain that I agree with maths being a natural law but I will avoid that discussion.
I think that you example of the trendline is a good one and yes if sufficient traders think that the trendline is the guide it becomes the result.
mully
The more time I spend looking at indicators, prices etc the more I lean towards simple price action. As you say each to their own. If there is a fibonaccist reading this and they think they can justify the system please feel free to convince me.
Regards
bracke
Not certain that I agree with maths being a natural law but I will avoid that discussion.
I think that you example of the trendline is a good one and yes if sufficient traders think that the trendline is the guide it becomes the result.
mully
The more time I spend looking at indicators, prices etc the more I lean towards simple price action. As you say each to their own. If there is a fibonaccist reading this and they think they can justify the system please feel free to convince me.
Regards
bracke
I am always interested in very sharp moves as they can offer the potential opportunity for a quick buck. However, with the 1 day SMA still falling I was not going to commit a normal unit. Therefore, I was looking for a higher low when the market stopped at 4410 ('cause I was aware all you Fib watchers were looking also.)I thought I saw a higher low on the 5 minute chart. However,the FTSE failed to make any progress so I aborted my quickie to live another day.
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bonsai
May I put into bracke speak ( for my benefit and my fellow lurkers) your reply to ascertain if I have understood your reply.
The markets adjust prices to sell or buy the amount of stock that they wish to buy/sell and whether that occurs after a 50% retrace or any other figure is neither here nor there. It depends on what the traders want to do in order to sell or buy.
Fibs are not self-fulfilling because there are not enough people using the system to influence the result. So if the result goes the way of the fibs it is coincidence.
Bears (and I presume Bulls) are aware of fibs and may lure you into a trap and not so much castigate you but do the other thing that I alluded to in my earlier post.
Is this a correct interpretation of your post?
Regards
bracke
May I put into bracke speak ( for my benefit and my fellow lurkers) your reply to ascertain if I have understood your reply.
The markets adjust prices to sell or buy the amount of stock that they wish to buy/sell and whether that occurs after a 50% retrace or any other figure is neither here nor there. It depends on what the traders want to do in order to sell or buy.
Fibs are not self-fulfilling because there are not enough people using the system to influence the result. So if the result goes the way of the fibs it is coincidence.
Bears (and I presume Bulls) are aware of fibs and may lure you into a trap and not so much castigate you but do the other thing that I alluded to in my earlier post.
Is this a correct interpretation of your post?
Regards
bracke
