Does technical analysis work or not?

[EnlightenedJoe]

You get nothing from that pic? At all??

Whats this inventory stuff all about, can u explain in brief, as you would to a 10yr old.

What am I supposed to get from the pic ? I am not getting an inkling at all. Looks like the price is moving up and down, doesn't seem very interesting. I couldn't tell from that if the MM is rogering the retail joes or the bank is shifting their weight about.

Ok, for 10 year olds, they love fizzy drinks. So let's say you go to tesco, you happen to go past the warehouse entrance at the back where they normally hang some thick semitransparent plastic/rubber blinds. You look in by chance as one of the warehouse guys push open the blinds and walks out. You notice the the warehouse is stacked full of colas. So you think: oh, what a lot of colas, is it in season or something ? Well, the cola is the inventory.

With that much cola in stock, is the price of cola coming down ? It's highly likely, and there's going to be promotions of buy one get one free for sure. Do we know when the promotion will happen ? We don't, could be next week, or 2 weeks time, whatever the tesco guy decides.

See, the inventory gives you the ability to predict the future of price ? Now where does supply and demand come in then ? Donno, and it doesn't seem to matter. The price was predetermined long before any demand appeared. It is the price (through it, the seller) that controls the demand and not the other way round.

 

[EnlightenedJoe]

Also helps to know who the opposition is.

I can tell you. His name is Joe Banker, he plays golf and drives a porsche, has a good collection wine down his cellar. But how does that help you ?

 

[dbphoenix]

On Forex, the inventory of Euros traded for dollars and vice versa is virtually infinite. No shortage of either at any point - yet the price of Euros in dollars changes all the time.

Correct. In a practical sense, there is no "inventory". Price advances because buyers are willing to pay the ask. Price declines because they aren't and sellers must then lower the ask in order to complete the transaction. Sellers can post whatever prices they please, but it doesn't become a transaction unless and until someone accepts it.

There are bids and asks hanging out there all over the place, but they don't become transactions unless and until someone accepts them. If no one does, they have no effect on the market.

If one is going to understand the dynamics of supply and demand, he has to understand the difference between a transaction and a hope.

Db

 

[EnlightenedJoe]

Price advances because buyers are willing to pay the ask. Price declines because they aren't and sellers must then lower the ask in order to complete the transaction.

Not so. Prices move according to positions and inventories. Here's a trade I took a couple of days ago demonstrating the effect. The move against the position was pretty much instantaneous. But the huffing and puffing was quite useless, since I knew their inventory.

I was hoping it moved a lot further against me because I wanted more. It pays a daily yield and nice to hold. I would be jumping up and down with happiness if they try again and harder this time. I really do need more. But it looks like they are going off to chase some other joes.

It's a very small position and nothing to boast about. But it illustrates how the opposition works, and I don't even need to know their name.

 

[darktone]

What am I supposed to get from the pic ? I am not getting an inkling at all. Looks like the price is moving up and down, doesn't seem very interesting. I couldn't tell from that if the MM is rogering the retail joes or the bank is shifting their weight about.

No rules heres mate, is fine to get nothing from the pic.
Just one thing. Didnt you say earlier that 'it doesnt really matter who is doing what'? I mean as long as price moves and folks . What else do we need to trade profitably?

Ok, for 10 year olds, they love fizzy drinks. So let's say you go to tesco, you happen to go past the warehouse entrance at the back where they normally hang some thick semitransparent plastic/rubber blinds. You look in by chance as one of the warehouse guys push open the blinds and walks out. You notice the the warehouse is stacked full of colas. So you think: oh, what a lot of colas, is it in season or something ? Well, the cola is the inventory.

With that much cola in stock, is the price of cola coming down ? It's highly likely, and there's going to be promotions of buy one get one free for sure. Do we know when the promotion will happen ? We don't, could be next week, or 2 weeks time, whatever the tesco guy decides.

See, the inventory gives you the ability to predict the future of price ? Now where does supply and demand come in then ? Donno, and it doesn't seem to matter. The price was predetermined long before any demand appeared. It is the price (through it, the seller) that controls the demand and not the other way round.

Cheers for that, not sure it translates that well to trading tho.
No doubt tescos have done the sums and realise they can probably shift a pile of inventory if they price it right. Or at least can convince the customers theyre getting a good deal, a bargain. How does that translate to trading? You mean the big boy trader is long all they can carry (lots of inventory), current price is +50 and theyve a stop at +30. That would be aiming a bargain at the other traders right.

 

[darktone]

I can tell you. His name is Joe Banker, he plays golf and drives a porsche, has a good collection wine down his cellar. But how does that help you ?

For sure theres the bankers, MMs, big boy club traders. But what about the other 90% of the opposition?

Lets take your trade as an example. (nice trade btw)

Most folks cant fade like that, let alone with the intention of adding the play as the heat builds. Whats their obstacle?

 

[EnlightenedJoe]

Just one thing. Didnt you say earlier that 'it doesnt really matter who is doing what'? I mean as long as price moves and folks . What else do we need to trade profitably?

Well, in any price move you the retail are on the one side, they are on the other. They on the other side work in concert and can be treated as a single entity even though they may be multiple entities. Across the battle lines there is no need to care who they are because they are all shooting at you.

To trade profitably, you have to know all the opposition's moves and have a counter. It's fencing, it's chess.

Cheers for that, not sure it translates that well to trading tho.

If you have a head for business then it will translate. If you don't then you are merely visiting the casino. People think anyone can trade. That isn't the case. My belief is that if you can manage a small fruit and veg stall and do well, you would have the good fundamentals for trading. If you can't, then best to do something else. The opposition are business man/men, they will take your money. They have the head for it.

 

[piphoe]

“If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”
― Sun Tzu, The Art of War

:idea:

 

[EnlightenedJoe]

For sure theres the bankers, MMs, big boy club traders. But what about the other 90% of the opposition?

The other 90% are with you right here on these forums.

Most folks cant fade like that, let alone with the intention of adding the play as the heat builds. Whats their obstacle?

Their obstacle is they don't know why the price move. If they did they would have a better idea on what happens next. If they knew what will happen next, there will be nothing to scare them.

 

[darktone]

Well, in any price move you the retail are on the one side, they are on the other. They on the other side work in concert and can be treated as a single entity even though they may be multiple entities. Across the battle lines there is no need to care who they are because they are all shooting at you.
To trade profitably, you have to know all the opposition's moves and have a counter. It's fencing, it's chess.

I think the opposition youre talking about are happy enough to sit back let the vast majority shoot themselves, they just give them the gun.

If you have a head for business then it will translate. If you don't then you are merely visiting the casino. People think anyone can trade. That isn't the case. My belief is that if you can manage a small fruit and veg stall and do well, you would have the good fundamentals for trading. If you can't, then best to do something else. The opposition are business man/men, they will take your money. They have the head for it.

Buy low, sell high. Its all I got, I dont think you need anymore than that technically.

 

[darktone]

Their obstacle is they don't know why the price move. If they did they would have a better idea on what happens next. If they knew what will happen next, there will be nothing to scare them.

Id have to disagree here joe. I think their biggest obstacle to trading well is that they have no real idea what the biggest obstacles in trading are.

Anyhoos, we going of topic eh. This is a technical indicators yes no other thread right.

 

[EnlightenedJoe]

Buy low, sell high.

Good plan. That will beat 90%+ of them who will guarantee buy high, sell low. For instance long at 10 and stop at 5 is such a guarantee. Often people are very smug how clever they are by doing that.

 

[darktone]

I think technical analysis is amazing, and I will cast my vote very soon.

Ive traded many indicators and technicals over the years but now and then you can uncover a real gem.

Below is snap of gold, with signals given to the sell side. I think youll all agree its been pretty amazing thus far and although technically speaking this technical indicator isnt 100% technical, its foundations are forged in the technically technical fire of logistical logicalism. Enough so for me to refer to it as such.

 

[piphoe]

...its foundations are forged in the technically technical fire of logistical logicalism


i like that may i use it

 

[babyjake1961]

I think technical analysis is amazing, and I will cast my vote very soon.

Ive traded many indicators and technicals over the years but now and then you can uncover a real gem.

Below is snap of gold, with signals given to the sell side. I think youll all agree its been pretty amazing thus far and although technically speaking this technical indicator isnt 100% technical, its foundations are forged in the technically technical fire of logistical logicalism. Enough so for me to refer to it as such.

Are you consistently profitable with this or any other technical indicator? If so, would you be kind enough to share your live results here via a verified MyFXBook link?

 

[darktone]

Good plan. That will beat 90%+ of them who will guarantee buy high, sell low. For instance long at 10 and stop at 5 is such a guarantee. Often people are very smug how clever they are by doing that.

I knoooow riggght. Not rocket science is it. :cheesy:

i like that may i use it

Please, feel free.

 

[EnlightenedJoe]

I think technical analysis is amazing, and I will cast my vote very soon.

Ive traded many indicators and technicals over the years but now and then you can uncover a real gem.

Below is snap of gold, with signals given to the sell side. I think youll all agree its been pretty amazing thus far and although technically speaking this technical indicator isnt 100% technical, its foundations are forged in the technically technical fire of logistical logicalism. Enough so for me to refer to it as such.

You must have taken a position. The price is shooting up.

 

[darktone]

Are you consistently profitable with this or any other technical indicator? If so, would you be kind enough to share your live results here via a verified MyFXBook link?

Ah, I havent as yet traded this particular indicator as its for gold only. However,,, im very tempted.

 

[dbphoenix]

I think technical analysis is amazing, and I will cast my vote very soon.

Ive traded many indicators and technicals over the years but now and then you can uncover a real gem.

Below is snap of gold, with signals given to the sell side. I think youll all agree its been pretty amazing thus far and although technically speaking this technical indicator isnt 100% technical, its foundations are forged in the technically technical fire of logistical logicalism. Enough so for me to refer to it as such.

Excellent example of the shift from demand (up) to supply (down).

(No doubt you picked up on the lower high)

Db

 

[piphoe]

Excellent example of the shift from demand (up) to supply (down).

(No doubt you picked up on the lower high)

Db

Db, would you be so kind as to apply your SLA analysis to his chart and post it?

Like to compare his entries against yours.

TIA