Do we need indicators?

[Splitlink]

Mofo---thanks for the cv but it would have been better posted on the "Introduce Yourself" thread last year.

You'll never learn, I'm afraid, but I wish you had gone somewhere else to express your views of yourself, instead of cluttering up this one with irrelevence--- your own thread, for example.

 

[lexcorp]

extraordinary claims require extraordinary evidence

 

[tar]

Mofo---thanks for the cv but it would have been better posted on the "Introduce Yourself" thread last year.

You'll never learn, I'm afraid, but I wish you had gone somewhere else to express your views of yourself, instead of cluttering up this one with irrelevence--- your own thread, for example.

He's spamming every other thread with the same stuff over and over again , i bet he has some templates that he just keeps copy and paste from , if that's not spamming i don't know what the @@@ it is . Everytime i take a peek at the boards i see the same stuff !

 

[lexcorp]

Are the private sub-forums still in effect, lol?

 

[malaguti]

Good read. Recommended.

thanks for that Atilla, I'd never read this only of it. really enjoyable what I find odd is that he hasn't really described his method in great detail and yet there are so many Darvas "plug-ins" it makes me wonder what they've actually come up with

great read though as you say, and not a chart in sight

 

[Forexmospherian]

Mofo---thanks for the cv but it would have been better posted on the "Introduce Yourself" thread last year.

You'll never learn, I'm afraid, but I wish you had gone somewhere else to express your views of yourself, instead of cluttering up this one with irrelevence--- your own thread, for example.

Hi Split

My apologies

Please feel free to have my comments removed via Timsk - or transferred to my trading systems thread - I don't mind either.

It is a good thread and I agree with you that off topics comments are cluttering up the comments of many other members.

If you mean I have not learnt that other members will call me a liar and a fraud and make other bad comments about me - that's never been a problem for me - you always stand up against bullies and haters - hardly anything for me to worry about it

Regards


F

 

[TheRumpledOne]

Do we need indicators? - For me yes - besides a clock I need extra assistance from certain indicators on a chart to get the accuracy I require for 5 pip stops. I tried naked charts after 8 yrs of my own bespoke indicators - and yes I could trade and even make money - but only with a lot larger stop size.

As traders we are all different - what might work for some - will be totally a waste of time for others - depending on are own requirements and of course our strengths and weaknesses etc.

With regards to scalping a 1 min bar for 2 or 3 mins - catch it at the right time of the session and you might make 15 -30 pips ( depending on the FX pair) - whilst 80 -90% of the time even with the correct direction call - you are just going to make 2- 7 pips net. OK if you have entered with a 2-5 pip stop - but not worth it if you are on 10+ pip stops - as RR's would be poor - therefore requiring 75- 85% win ratio accuracy on going

TRO's methods are OK if you are just after average profitable results - ie 40 -70% per annum on retail size accounts under $100k. If you are after 100 -500% results per annum on retail size capital accounts ( not compounding - as not sustainable) you need a far more complex method with one or two"edges" that can combine high win ratios ( over 70% +) with small stops allowing you to obtain RR's of 2+ and even up to 5 or more on a regular daily basis,

This cannot be done ongoing over months and years with simple trading methods - as the market and the market makers are just too clever to allow that to happen.

Regards

F

Hello F:

I was just about to finish reading one of your threads when you mentioned my name. Couldn't resist clicking on the link.

I scalped for years when I was in the city with high speed cable internet and 5 computers online. But now, I live at my country place and don't have a reliable high speed connection. So, I look for trades I can set and forget. Come back later to see the results.

My trading experience spans over 4 decades. I have learned a few things about trading but am always willing to expand my knowledge. Looking forward to learning some of your tricks.

In a way, I am happy to see I am not the only one who gets attacked on these trading forums - misery loves company. It is sad that people go out of their way to derail threads. I know longer get into battles with TRO HATERS. It is a battle best left alone.

I use the following quotes to respond to the TRO HATERS:

"I am not forcing you to accept my concepts. I only request the traders to review the market from time to time keeping in mind my concepts and if found suitable use in the trades or just ignore. Thanks for your opinion."


"The technique is so simple that just several lessons (or a few pages of explanations) cover it all. Now what? Now the student has to practice, practice and practice again to understand what he had been taught. The teacher DOES know much more than the student, but his understanding can't be "passed", "transferred" or taught in any way -- not even by reading books."

Feel free to use them often.

- TheRumpledOne aka TRO

 

[TheRumpledOne]

FoMo,

I asked for your definition of 'proper' as it is a term you introduced in your earlier post. You're free to withdraw it and revert to the widely accepted and understood terms 'leading' and 'lagging' if you want - but you might like to think about my next comment before doing so . . .


Within the context of traditional technical analysis, moving averages and MACD are both lagging indicators. Oscillators such as Stochastics and RSI are leading indicators. Yes they are based on price and change when price changes but, nonetheless, they are still regarded as leading indicators. If you're going to change established meanings and definitions, I suggest you use your own terminology and define it as precisely as you can so that everyone understands what you mean by it. Re-defining established terms just muddies waters that are already pretty murky and is generally unhelpful. In a nutshell, switching from 'proper' to 'leading/lagging' and then saying all indicators are lagging except when they are mysteriously transformed into leading ones is what makes some members think you're merely trying to baffle them with quagmires of bullpoo.


Any leading indicator will be fairly effective when applied to the right market condition, namely when price oscillates in a sideways trading range. By the same token, lagging indicators will perform equally well in a market that is trending strongly. When that happens, a 'leading' indicator is prone to giving false signals and is unreliable. Needless to say, for those that wish to use indicators, the trick is to identify the market condition first, and to apply the appropriate indicator (either leading or lagging), second. Most academic studies that I've ever seen fail to do this.
Tim.

Leading indicators? You're joking, right? If price is an input, then how can the formula produce a leading result? Think that through before you respond.

The problem resides both in the indicator and the trader using it improperly. That is why I code gauges rather than SQUIGGLY LINES. I have made a few videos on that topic.

SQUIGGLY change value when you change the chart time frame. HORIZONTAL LINES remain in the same place. That should be an obvious clue which type of indicator to use.

ALL YOU NEED TO KNOW ABOUT TRADING

* Price either goes up or down.
* No one knows what will happen next.
* Keep losses small and let winners run.
* POSITION SIZE = RISK / STOP LOSS.
* The reason you entered has no bearing on the outcome of your trade.
* You can control the size of your loss (skill) but you can't control the size of your win (luck).
* You need to know when to pick up your chips and cash them in.

Expectancy = (Probability of Win * Average Win) - (Probability of Loss * Average Loss)

You cannot control the probabilities of wining or losing.

You cannot control your average win size.

The only part of the equation that you can control is your average loss size.

PRICE ACTION

“Now, 2 patterns of market behavior happen on a regular basis:

1) the price breaks to new high's (or low's)

2) the price reverses from new high's (or low's)

They happen regardless of time frame .

They are phenomena that can be exploited without the fear if found out by others, that they might cease to exist.” - H. Rearden

1) Price will either breakout of the high, low or both of the previous bar

2) Price will not breakout of the previous bar.

You cannot reduce it any further. Anything else complicates the issue.

ENTERING A TRADE

You either decide to:

1) Wait and do not enter a trade

2) Trade a breakout

3) Trade a reversal.

Those are your ONLY 3 options.

That is all you need to know about trading.

 

[TheRumpledOne]

Well heres an example of a live trade on the EJ taken in the last hour

I scalp sold the pair at 141- 79 - ie the interim high ( I actually got 141 786 as entry)

My stop would be 3 pips and I am using indicators to get the accuracy I need

Already - the trade in under 30 mins as a net RR of 4+

My leading indicators are -

1. Time frame changes in a half hr time window ( 9 mins either side)

2 LR indicators on a 1 min chart set at different setiings to show Price structure

3. Trendlines - 2 shown - and for me - are leading indicators

4 - Resistance - interim resistance band at 75 to say 85 with past R at 80

Along with a few other indicators - this gets me my scalp accuracy

To try and do this with a naked chart - is possible - with a bit of luck - but certainly far more difficult etc

I have not shown ray lines and angles of rise and fall etc - as did not want to confuse further etc - nor small frame oscillators such as a RSI on a super quick 2 setting

I will also find some past charts with my best leading indicator - ie the LR2

This indicator - works in advance of price movement and is therefore truely leading

Like anything techinical in forex trading - it can never be 100% accurate - trading is not a mathematical science and is not clean black or white - its full of grey and uncertainty

These reasons are just my own case for why I need indicators

I would also like to point out - all broker platforms are not that accurate

I would compare them with say a 1950's Ford Speedometer - ie showing 70 mph and doing a true 62 mph.

To get the most out of indicators - you have to mainly ignore the normal standard settings and bespoke them to your requirements - as well as play with them - as I have with Linear regression indicators on tick and 1 min charts to get rid of as much lag as possible - but still show structure in the present and in the near future

Please dont think I have anything against naked chartist - or 4 hr or daily chart traders. The latest "fashion" - I am seeing on some on other sites is traders uisng weekly charts for their entries;-)

Nothing against that - I use weekly / monthly and even quarterly charts to get the big picture view - and I am a scalper - but try to predict that far ahead to me is really pure guessing and so for me - high probability is vastly reduced.

I take on board Tim's points with regards to my terminology etc - and all comments i make are purely based on my own findings over last 11+ years - and are not necessary the views of other experienced traders

The question is though - are they making the retail profits I say are available - and if not - why not ??

Regards


F

F:

The more I see your charts, the more your entries look like my RAT REVERSALS

GREEN RAT REVERSAL - LONG ENTRY CRITERIA:
1) RED CANDLE CLOSES
2) GREEN CANDLE CLOSES
3) PRICE TOUCHES HIGH OF PREVIOUS GREEN CANDLE - ENTER LONG.


RED RAT REVERSAL - SHORT ENTRY CRITERIA:
1) GREEN CANDLE CLOSES
2) RED CANDLE CLOSES
3) PRICE TOUCHES LOW OF PREVIOUS RED CANDLE


Of course, you use your own timing and price position to determine when and where to initiate the trade.

 

[TheRumpledOne]

i also today replayed TRO's video - as been a bit since I had watched it.

Nothing against the guy - but for me he is wrong on several points.

F

Care to elaborate? You only mentioned one point. What are the others? I am listening.

Yes, charts are different but PRICE IS THE SAME! Of course, that being said if a broker is NY based and uses the NY open to start the day, the NY open price will be different than the London open price. But across all chart periods, those open prices will remained fixed for the trading session. That is the point I am trying to get across.

 

[TheRumpledOne]

Hi Tim

Lets be 100% clear here - I am no vendor

Ok now thats out of the way - I am sorry to have to disagree with you - but you are wrong - very much again like the other member I have already mentioned

The LR 2 is a unique indicator

Initially it would only work on Intellicharts platform - ( manufactured by FXtrek ) and if you tried a LR indicator on any other platforrm - especially any broker platform - then you would not get the actual line to move in advance of the candle open

I really do not think you have fully understood what I am saying here

The LR 2 with intellichart coding - moved in advance - prior to the next candle or bar - ie if it was at 10 59 and 58 seconds and the next hr candle changed at exactly 11 00 am - then if the indicator popped out above the yet to be printed candle - ie in advance - then that was saying the next hr - price should fall.

If price was falling and there had been a drop that had created an oversold situation and it was for example 3 59 pm UK time in the US session and the Lr 2 indicator went out of the BB and under the new candle - still yet to open - then this showed with high probability that after 4 00pm and the new candle printing - price would rise.

Can I repeat this

This happens in advance to price action - ie before the move

This is a true leading indicator.

I believe by 2005 - the special code - which was different to all the other chart platform codes on a LR at a 2 setting - was copied and made free for MT4 charts

Prior to that FX Trek would charge $100 a month for their pro chart package.( and the majority of their users knew nothing about this special setting - unique to only that platform )

I have absolutely no business link or connection with FX Trek or to anyone who produces different LR indicators

Yes i would agree the RSI at a quick 2 setting as been about for years - similar Bollinger bands on tight settings - but the real jewel in the crown is the LR2

If you say this is well known and been around for ages etc etc - well you must be living in a different world to me.

I know its never been mentioned in any FX literature - as far as I am aware - nor taught it any seminars or course etc etc

If you can prove me wrong - please do - the only person I know who as openly mentioned it as far as I am aware over that last 8 years - has been me

Now with regards to trading secrets

Of course there are trading secrets as there are secrets in any walk of life

Many secrets are hidden deliberately - even the US FBI would not be able to find them out - but a lot of secrets in businesses and certainly in the financial markets never come to light. I mean even HSBC could not believe that the majority of their main cash flow in the early 2000's was via illegal means and money laundering

Someone had to tell them - how embarrassing

Now what else do you want me to tell you


Regards


F

PS - yes I am saying what i have said - and I can imagine when it was April 1st back in the 13th of 14th Century and some nutter was saying the earth is not flat - many would have been laughing at that as well

F:

Before I started trading currencies, I traded equities. I learned about Linear Regression (LR) and RSI(2). I am very familiar with those and positive/negative divergence. Just so you know, I know:

The chart displays LR for 1, 2 and 3 Std Dev. The gauge gives the values. The RSI divergence indicator plots lines for the most recent divergence. The multimeter display the distance in pips from the LR for each chart period. Profitable tools in the right hands.

 

[TheRumpledOne]

ALL YOU NEED TO TRADE IS A HORIZONTAL LINE:

http://youtu.be/IFJFuJ6-tQY

 

[timsk]

Hi TRO,

Leading indicators? You're joking, right? If price is an input, then how can the formula produce a leading result? Think that through before you respond.

I've thought it through and it doesn't impact what I said at all, so I stand by what I wrote. The reason for this is expressed in the first sentence of the 2nd paragraph, which I'll post again here to save you finding it: "Within the context of traditional technical analysis, moving averages and MACD are both lagging indicators. Oscillators such as Stochastics and RSI are leading indicators." Please note the emphasis.

In case the point I was trying to make in that post isn't clear, I've expressed it rather more eloquently (I think) to a new member on another thread: MACD signal line cross zero centreline I hope that clears up any misunderstanding!
Tim.

 

[Sigma-D]

Leading indicators? You're joking, right? If price is an input, then how can the formula produce a leading result? Think that through before you respond.

The problem resides both in the indicator and the trader using it improperly. That is why I code gauges rather than SQUIGGLY LINES. I have made a few videos on that topic.

SQUIGGLY change value when you change the chart time frame. HORIZONTAL LINES remain in the same place. That should be an obvious clue which type of indicator to use.

ALL YOU NEED TO KNOW ABOUT TRADING

* Price either goes up or down.
* No one knows what will happen next.
* Keep losses small and let winners run.
* POSITION SIZE = RISK / STOP LOSS.
* The reason you entered has no bearing on the outcome of your trade.
* You can control the size of your loss (skill) but you can't control the size of your win (luck).
* You need to know when to pick up your chips and cash them in.

Expectancy = (Probability of Win * Average Win) - (Probability of Loss * Average Loss)

You cannot control the probabilities of wining or losing.

You cannot control your average win size.

The only part of the equation that you can control is your average loss size.

PRICE ACTION

“Now, 2 patterns of market behavior happen on a regular basis:

1) the price breaks to new high's (or low's)

2) the price reverses from new high's (or low's)

They happen regardless of time frame .

They are phenomena that can be exploited without the fear if found out by others, that they might cease to exist.” - H. Rearden

1) Price will either breakout of the high, low or both of the previous bar

2) Price will not breakout of the previous bar.

You cannot reduce it any further. Anything else complicates the issue.

ENTERING A TRADE

You either decide to:

1) Wait and do not enter a trade

2) Trade a breakout

3) Trade a reversal.

Those are your ONLY 3 options.

That is all you need to know about trading.

I really like this post. It's clear, simple and has an certain feel of calmness to it. If you know this is where it's all at, why on earth have you spent 20 years programming gauges and indicators?

 

[DionysusToast]

ALL YOU NEED TO TRADE IS A HORIZONTAL LINE:

http://youtu.be/IFJFuJ6-tQY

You don't need lines to trade.

To put a line on a chart, you actually need to set the position of that line somehow.

The method of doing that could be just as useless as a price based indicator.

What is your point in this TRO? As someone that has been developing indicators (and asking for donations for them) for years - are you saying that the stuff you developed was as much use as t!ts on a bull?

 

[DionysusToast]

Leading indicators? You're joking, right? If price is an input, then how can the formula produce a leading result? Think that through before you respond.

The problem resides both in the indicator and the trader using it improperly. That is why I code gauges rather than SQUIGGLY LINES. I have made a few videos on that topic.

SQUIGGLY change value when you change the chart time frame. HORIZONTAL LINES remain in the same place. That should be an obvious clue which type of indicator to use.

ALL YOU NEED TO KNOW ABOUT TRADING

* Price either goes up or down.
* No one knows what will happen next.
* Keep losses small and let winners run.
* POSITION SIZE = RISK / STOP LOSS.
* The reason you entered has no bearing on the outcome of your trade.
* You can control the size of your loss (skill) but you can't control the size of your win (luck).
* You need to know when to pick up your chips and cash them in.

Expectancy = (Probability of Win * Average Win) - (Probability of Loss * Average Loss)

You cannot control the probabilities of wining or losing.

You cannot control your average win size.

The only part of the equation that you can control is your average loss size.

PRICE ACTION

“Now, 2 patterns of market behavior happen on a regular basis:

1) the price breaks to new high's (or low's)

2) the price reverses from new high's (or low's)

They happen regardless of time frame .

They are phenomena that can be exploited without the fear if found out by others, that they might cease to exist.” - H. Rearden

1) Price will either breakout of the high, low or both of the previous bar

2) Price will not breakout of the previous bar.

You cannot reduce it any further. Anything else complicates the issue.

ENTERING A TRADE

You either decide to:

1) Wait and do not enter a trade

2) Trade a breakout

3) Trade a reversal.

Those are your ONLY 3 options.

That is all you need to know about trading.

"You cannot reduce it any further. Anything else complicates the issue."

Prior highs & lows?

Breakout & reversals - those are the only trades?

This is nonsense and absolutely nothing at all to do with what trading is actually about.

What this is - is trading in the most crowded areas in the markets. It's making yourself shark bait. These are the worst areas to trade hands down. These are the areas where larger traders are able to build positions because of all the losing traders trying to get positioned here.

Think about it people - and think hard because the above post from TRO will lose you real money. You want to enter in the most visually appealing area where all the other retailers will enter? Areas where a large player can nudge the market around, stop you out and put your money in his pocket?

 

[Sigma-D]

Think about it people - and think hard because the above post from TRO will lose you real money. You want to enter in the most visually appealing area where all the other retailers will enter? Areas where a large player can nudge the market around, stop you out and put your money in his pocket?

I appreciate you and TRO are both vendors in a crowded marketplace and this sort of sniping is to be expected. But I'm confused about your comments on being stop-hunted by the sharks. You make it sound as if all the retail players place their bets the same way and the big boys know how they're going to play it and they line up to pick their pennies off the table.

I'm a novice, but even I know this is total rubbish when it comes to the forex market.

There simply isn't anyone who can shove the market around in the way you suggest. And it's not 'they' taking from 'us' - all there is a price and virtually unlimited liquidity at every level.

The other reason this is nonsense is that retail traders don't all trade the same way - that's the whole point. There's a cloud of punters long and a roughly equal number short along the distribution curve of open positions centered around the current price.

I gather you market an orderflow product which suggests you don't have that much experience or exposure to the forex market, so perhaps you should make clear precisely to which markets you're directing your comments to avoid any further confusion.

 

[Splitlink]

I appreciate you and TRO are both vendors in a crowded marketplace and this sort of sniping is to be expected. But I'm confused about your comments on being stop-hunted by the sharks. You make it sound as if all the retail players place their bets the same way and the big boys know how they're going to play it and they line up to pick their pennies off the table.

I'm a novice, but even I know this is total rubbish when it comes to the forex market.

There simply isn't anyone who can shove the market around in the way you suggest. And it's not 'they' taking from 'us' - all there is a price and virtually unlimited liquidity at every level.

The other reason this is nonsense is that retail traders don't all trade the same way - that's the whole point. There's a cloud of punters long and a roughly equal number short along the distribution curve of open positions centered around the current price.

I gather you market an orderflow product which suggests you don't have that much experience or exposure to the forex market, so perhaps you should make clear precisely to which markets you're directing your comments to avoid any further confusion.

I do not think that this is, at all, total rubbish. Retail traders do tend to put their stops in "logical" areas, which is not a mathematical spot on the chart but covers a zone. They have been brain-washed to do this, There is very little originality in what most traders do and this is why spikes occur and why traders see their trade go into profit, only to retrace into a loss, afterwards.

I admit that it poses a problem because traders must, or should, put a safety stop somewhere. But if their choice is going to be covered by a market spike---where?

 

[Traderallen]

Just thought I'd throw my opinion in the ring. The question is do we need indicators? My answer would be; sure, if you want to lose money than you need them. All indicators lag and there are no exceptions everyone will get you in late. Let's keep it simple, 95% or more of traders lose because 95% or more of traders try to rely on indicators. One only needs to take a look at the professional traders that trade the markets. They don't use indicators and they make money. If you cannot look at a naked chart and see if it's trending upwards downwards or sideways. If you cannot look at a naked chart and identify areas of support and resistance you are destined to fail, it's that simple.

 

[Atilla]

Just thought I'd throw my opinion in the ring. The question is do we need indicators? My answer would be; sure, if you want to lose money than you need them. All indicators lag and there are no exceptions everyone will get you in late. Let's keep it simple, 95% or more of traders lose because 95% or more of traders try to rely on indicators. One only needs to take a look at the professional traders that trade the markets. They don't use indicators and they make money. If you cannot look at a naked chart and see if it's trending upwards downwards or sideways. If you cannot look at a naked chart and identify areas of support and resistance you are destined to fail, it's that simple.

Looking at a naked chart - how does one determine;

1. Where to enter
2. Where to exit
3. Where one sticks SL

In answering these questions something must fire some neurons or whatever, in ones MEGA mind to initiate (didn't wish to use the Indi word :cheesy: ) that action to place a trade?

So in the absence of initiators how does one determine a trade???

Also, when looking at a naked chart - what time frame does one look at?

Playing devil's advocate here somewhat but I'm always astounded by the big **** fights amongst highly educated, well behaved and well meaning individuals.

Leaving aside the big-cocks how is it possible that such great level of mis-communication can take place amongst sooo many well educated, well to do and well meaning individuals???


If I am to consider all you wise-men as indicators on how to trade then lesson learnt would be to use some indicators but not too many.

The trick is in picking the indicator that works for you!!! :smart: