For those using technical analysis, which indicators have actually stayed reliable for you over time?

[ImogenBeaumont]

I’ve noticed that a lot of traders constantly switch indicators when a setup stops working for a while. I’m curious about the opposite: the tools that have stuck with you.

 

[1nvest]

I’ve noticed that a lot of traders constantly switch indicators when a setup stops working for a while. I’m curious about the opposite: the tools that have stuck with you.

Hi i never switch the indicators i use.
The main ones for me are the Rate of Change, the Donchian Channel and the Williams%R..I use these across the various strategies i use
The rate of change to measure the relative strength of asset class and trend, the donchian for risk management, and the williams%R also for trend

 

[Jason101]

Only one, price, price at suport and resistant, price moving up, price moving down, price moving sideways, price moving at different speeds, price moving at different angles, price breaking out, price retracing, price hitting new lows or highs in differing time frames.
Price at different times of day, price at different days of the week. Price at different times of news releases Price at different times of unplanned news. Price compared to prices of other instruments, price compared to the dollar.

 

[steven46]

Hello Imogen

I hope you don't mind my using what I believe is your first name. I don't want to be disrespectful

I was taught by an institutional professional to use VWAP and Volume Profile. They provide consistent
value and a stable edge. Interestingly, when my system fails, it is usually me (operator error).

I was also taught to identify "repetitive behaviors" (price patterns that repeat). I realize that this is not
an "indicator" per se, but, it over the years, this technique has also provided a predictive (and stable) edge.

And finally, I have learned to enter trades "early". Again the Professional who taught me (years ago) called
this "Blind Entry", and his reasoning was that this technique although considered "aggressive" provides two
benefits as follows. 1) when you are wrong, you know it right away and can take measures to minimize loss
2) when you are right, early entry maximizes profit, and allows the aggressive trader to exit right about the
time when less skilled operators are entering. While it may seem counterintuitive, remarkably these two
techniques (identifying repetitive behaviors and "blind entries") combine to produce a result that has been
consistent over many years.

I will attach a chart that illustrates (some of) the points mentioned

Good luck

 

[ImogenBeaumont]

Hi i never switch the indicators i use.
The main ones for me are the Rate of Change, the Donchian Channel and the Williams%R..I use these across the various strategies i use
The rate of change to measure the relative strength of asset class and trend, the donchian for risk management, and the williams%R also for trend

Keeping the same tools but giving each a clear role makes a lot of sense.

 

[ImogenBeaumont]

Only one, price, price at suport and resistant, price moving up, price moving down, price moving sideways, price moving at different speeds, price moving at different angles, price breaking out, price retracing, price hitting new lows or highs in differing time frames.
Price at different times of day, price at different days of the week. Price at different times of news releases Price at different times of unplanned news. Price compared to prices of other instruments, price compared to the dollar.

Everything ultimately resolves back to price. What’s interesting is how you’re framing it less as a single indicator and more as context: structure, time, speed, and relationships. Do you formalize any of that into rules, or is it mostly discretionary reading of price behavior?

 

[ImogenBeaumont]

Hello Imogen

I hope you don't mind my using what I believe is your first name. I don't want to be disrespectful

I was taught by an institutional professional to use VWAP and Volume Profile. They provide consistent
value and a stable edge. Interestingly, when my system fails, it is usually me (operator error).

I was also taught to identify "repetitive behaviors" (price patterns that repeat). I realize that this is not
an "indicator" per se, but, it over the years, this technique has also provided a predictive (and stable) edge.

And finally, I have learned to enter trades "early". Again the Professional who taught me (years ago) called
this "Blind Entry", and his reasoning was that this technique although considered "aggressive" provides two
benefits as follows. 1) when you are wrong, you know it right away and can take measures to minimize loss
2) when you are right, early entry maximizes profit, and allows the aggressive trader to exit right about the
time when less skilled operators are entering. While it may seem counterintuitive, remarkably these two
techniques (identifying repetitive behaviors and "blind entries") combine to produce a result that has been
consistent over many years.

I will attach a chart that illustrates (some of) the points mentioned

Good luck

Really like that approach! For me, just watching price like how it moves, reacts to news, hits support or resistance has been just as reliable, without faffing about with different indicators.

 

[Jason101]

Everything ultimately resolves back to price. What’s interesting is how you’re framing it less as a single indicator and more as context: structure, time, speed, and relationships. Do you formalize any of that into rules, or is it mostly discretionary reading of price behavior?

Rules yes but not in the way you think.
An overall picture of what I do would be helpfull.
I choose with fundamentals a long term trade, three months plus going into years.
And then dollar cost average into it on the five minute timeframe sometimes going down to two or three minute time frame (time frame will be slightly different depending on the instruments volatility) discretionately using the price and time as an indicator as discussed in my last post (This is done with the backdrop of spending hours and hours and hours watching and trading the particular instrument that I have for my long-term trade.)

My biggest rules are all on money management and trade management.
The money management and trade management play a part of the entry and exit rules.

I don't believe there are many edges to retail traders, we don't have inside information. An indicator, open source and available to everyone cannot provide an edge in my opinion.
I think the edge has to come from within ourself and cannot be taught. All of us are different people, so I think the edge is individual especially for retail traders.

Please, please, everybody bear in mind that professional traders make their money from one of a few ways, either a cut of the spread, a commission on trades, arbitrage or a salary as a liquidity provider.
There are very, very few professional (or retail) traders who make consistent money from directional trading.

All the best while you go down this route. Don't let it mess you up financially or mentally and don't let it take living your life away from you.

 

[steven46]

Remarkable
"Three ways that professionals make their money". I'm sorry, just not close to the truth.
As regards the comment about "consistent money" from directional trading, again not even close.,
Skilled professionals learn to identify regime (condition). A simple example is to identify whether
the majority of volume executed during previous market sessions occurred above or below
a key reference. This tells us which side is vulnerable (longs or shorts). From that we know that if we
wait patiently, at some point a precipitating event will occur, and the vulnerable side (already underwater)
will have to take action to cut losses, Professionals have a phrase for this ("waiting for the Give Up Bar")
We wait, identify that condition, then execute, manage and exit.

I have been trading the New York Session of the S&P 500 Futures for 18 years (at Christmas). Making a living
from "directional" trading, with the goal to obtain 10 point swings. I certainly do adjust to changing conditions
and may be required to take smaller (scalp) trades on a given day. Those trades are generally +3 pts minimum.
I am able to realize my goal on average 3-4 days a week. I know of no professionals who trade "the spread" as a viable way to
make a living. That arena is dominated by automated programs and institutions that "co-locate" their offices near to the
exchange to obtain an edge, not by humans.

Interested traders can refer to my thread "A Professional Approach to Trading", where I post charts.

Good luck

 

[NVP]

Indicators are consistent....its the market that's the problem

😄

N

 

[NVP]

Remarkable
"Three ways that professionals make their money". I'm sorry, just not close to the truth.
As regards the comment about "consistent money" from directional trading, again not even close.,
Skilled professionals learn to identify regime (condition). A simple example is to identify whether
the majority of volume executed during previous market sessions occurred above or below
a key reference. This tells us which side is vulnerable (longs or shorts). From that we know that if we
wait patiently, at some point a precipitating event will occur, and the vulnerable side (already underwater)
will have to take action to cut losses, Professionals have a phrase for this ("waiting for the Give Up Bar")
We wait, identify that condition, then execute, manage and exit.

I have been trading the New York Session of the S&P 500 Futures for 18 years (at Christmas). Making a living
from "directional" trading, with the goal to obtain 10 point swings. I certainly do adjust to changing conditions
and may be required to take smaller (scalp) trades on a given day. Those trades are generally +3 pts minimum.
I am able to realize my goal on average 3-4 days a week. I know of no professionals who trade "the spread" as a viable way to
make a living. That arena is dominated by automated programs and institutions that "co-locate" their offices near to the
exchange to obtain an edge, not by humans.

Interested traders can refer to my thread "A Professional Approach to Trading", where I post charts.

Good luck

Hey Steven

Don't think you were active when I eased down my forex thread here

Respect

I will read your thread

N

 

[steven46]

Hello NVP

I like the use of Initials, it works well

and Thank you for your kind word (Respect)

I hope you will gain something from review of my posts
and finally be advised that I will not be here much longer
In the next week I will start a new venture, that will include a
series of articles about the Funded Trader Industry (if one could
call it that). I was going to call it "Winning the Loser's Game, however
I discovered that that title although apt, is already taken.

I will also be LiveStreaming my Intraday trading and if possible training
a few students.

That's about it as regards my path forward.

Good luck

 

[stat_trader]

Great perspectives here.


Quick question: for short-term mean reversion in stocks (next 1–3 days),
do you ever use historical/statistical screeners to sanity-check a bounce setup,
or is it mostly discretionary for you?

 

[steven46]

Hello stat_trader

I am not sure if your question was directed to me?

I review back about 30 days in order to identify "Repetitive Behavior" (I have referred
to this previously, many times). I think in terms of synchronicity for example if price
action was affected by the release of high impact economic news, then I would
immediately dial back to the previous release to see how the market reacted then.
Depending on what I see, I then have a point of reference. And here I will provide
something that normally I reserve for my class. It is called the "2 day rule".

• Avoiding the Noise: High-impact economic news creates significant initial volatility and potentially large, erratic price swings as the market digests the data. The "2 day rule" is a risk-management technique to let this initial flux settle and observe the genuine market direction after a more rational response takes hold.
• Breakout Confirmation: The rule is specifically used to validate breakouts from key technical levels. It requires the price to penetrate a support or resistance level and then close beyond that level for two consecutive trading days to confirm the move as legitimate rather than a "false breakout" or "head fake".
• Institutional Discipline: For institutional desks, this rule enforces a disciplined approach, preventing impulsive moves driven by short-term emotional reactions that often characterize retail trading immediately after a major release (e.g., NFP, CPI, or FOMC announcements).

Professionals know this, however, Retail traders should keep in mind that this is not a hard and fast practice. For those who have enough
capital and are not risk averse, you may also want to refer to a practice by "TraderTom" Hougaard. He uses a setup called "Rule of 4"
While I respect the guy's achievements, when I review using data from the S&P Market, it does not seem to work very well. Perhaps
in Forex Markets, the result might be different. Always test before accepting risk.

Finally to answer the specific question stat_trader, I do not trust third party vendors to provide accurate data dependent services
I trust myself.


Good Luck