Trading Tea Leaves

[DionysusToast]

Let's say someone traded based on the pattern made by the leaves in their tea.

They have the tea before trading and based on the leaves left, they draw horizontal lines above and below the current price. They go long at the lines below and short at the ones above.

When they first start, this system is not good. Over time, they persevere. They get a feel for that market, they get a feel for how much leeway an entry needs to give it chance to come good. They get a feel for how to manage the trade after entry. They get a feel for when to take a trade and when not to take a trade.

Eventually, they are profitable. They are consistenly making money on this combination of tea leaves and levels.

Now - what happens when this person attempts to trade without the tea leaves and why?

Let's say that tea blight eradicates worldwide crops...

 

[barjon]

toastie

It's an interesting question. I would guess that most people have some "trigger" that causes them to focus on a particular price level and potential trade, whether it be fundamental data, TA patterns, market action via the tape, or whatever.

Given the progression in your example, I'd say that they have progressed beyond tea leaves - there's a good title for your book - without realising it and that their "feel" for the market would enable them to find opportunities without downing cups of tea first.

cheers

jon

 

[Hotch]

Surely the way the question is worded implies that the tea leaves have nothing to do with it. If you hadn't biased it and just said he starts off and isn't profitable to begin with, but is later, then it could be the tea.

 

[HowardCohodas]

There is an Australian Bushman belief that the sun will rise later if the dead are not buried with their faces to the east. Weapons and other Bushman treasures are buried with the dead, and the hut materials are burnt in the grave.

What will happen if they fail to perform this custom?

 

[redart]

but he draws his levels based on the T-Leaves....

 

[nunrgguy]

Switch to coffee grinds?

 

[bbmac]

The most obvious answer is to go long on Tea ?

I guess the real crux of the analogy is what happens to a trader's psyche when an artificial crutch is removed that actually wasn't contributing to the success of a trader anyway? This can be an issue. I had a similar issue some years ago - before I developed a methodology for determining potential support/resistance I relied on a 3rd party vendor for such levels/zones who sudenly dried up/stopped and it took me a while to realise that actually my methodology was better than theirs anyway both in being actually able to see why certain levels might act as future potential supp/res and also the overall acuracy. My knee-jerk reaction to the removal of the crutch was soon set aside by this realisation that actually I had stopped relying it a long time before it was removed.

Over time I think we as traders should perform an inventory of the usefullness of the tools we are using in making our trading dcisions and remove those that are no longer useful/that we have outgrown/replaced or are actually no longer contributing/relevant/being referred to in our trading decisions but still exist by way of a habit that has developed.

G/L

 

[Splitlink]

Let's say someone traded based on the pattern made by the leaves in their tea.

They have the tea before trading and based on the leaves left, they draw horizontal lines above and below the current price. They go long at the lines below and short at the ones above.

When they first start, this system is not good. Over time, they persevere. They get a feel for that market, they get a feel for how much leeway an entry needs to give it chance to come good. They get a feel for how to manage the trade after entry. They get a feel for when to take a trade and when not to take a trade.

Eventually, they are profitable. They are consistenly making money on this combination of tea leaves and levels.

Now - what happens when this person attempts to trade without the tea leaves and why?

Let's say that tea blight eradicates worldwide crops...

I use Brooke Bond PG Tip tea bags. Am I missing something?

 

[forker]

Am i suppose to chant something to get it to work ?

 

[counter_violent]

There is an Australian Bushman belief that the sun will rise later if the dead are not buried with their faces to the east. Weapons and other Bushman treasures are buried with the dead, and the hut materials are burnt in the grave.

What will happen if they fail to perform this custom?

They will need to find something else to occupy their time. Drink tea perhaps !

 

[neil]

There is an Australian Bushman belief that the sun will rise later if the dead are not buried with their faces to the east. Weapons and other Bushman treasures are buried with the dead, and the hut materials are burnt in the grave.

What will happen if they fail to perform this custom?

the answer lies within

http://www.youtube.com/watch?v=ZAYmk9Qb9Dc&feature=related

 

[HowardCohodas]

the answer lies within

 

[DionysusToast]

Switch to coffee grinds?

I find this answer exceptionally clever - in fact, in terms of crutch replacement - it would be an ideal solution.

The most obvious answer is to go long on Tea ?

I guess the real crux of the analogy is what happens to a trader's psyche when an artificial crutch is removed that actually wasn't contributing to the success of a trader anyway? This can be an issue. I had a similar issue some years ago - before I developed a methodology for determining potential support/resistance I relied on a 3rd party vendor for such levels/zones who sudenly dried up/stopped and it took me a while to realise that actually my methodology was better than theirs anyway both in being actually able to see why certain levels might act as future potential supp/res and also the overall acuracy. My knee-jerk reaction to the removal of the crutch was soon set aside by this realisation that actually I had stopped relying it a long time before it was removed.

Over time I think we as traders should perform an inventory of the usefullness of the tools we are using in making our trading dcisions and remove those that are no longer useful/that we have outgrown/replaced or are actually no longer contributing/relevant/being referred to in our trading decisions but still exist by way of a habit that has developed.

G/L

We are lucky on this thread to have someone who's tea leaves got taken away. I would love to hear more about the actual process you went through BBMAC because for sure, it was more complex than "I just realised".

In terms of my opinion - I am of the opinion that if the fictional character in the OP had his tea taken away, then he would start to fail. Not because his tea leaves help - but because he thinks he needs the tea leaves.

Perhaps some people disagree that he'd even have gotten as far as he did. For those that can see it is possible:
- what do we do to analyze the things we use?
- should we just leave things along if what we use seems to work?

 

[Hilarymannah]

The tea leave analogy is synonymous with the art of coin flipping,..not technical indicators, (which have comparitive spatial utility)

Just sayin',.......; )

 

[Splitlink]

Any gypsy lady will tell you that she got rich by reading tea leaves, certainly not by flipping a coin, which anyone can do. As for the words "technical indicator" ---she would not have a clue what that means. For me, "technical indicator" sounds very impressive but, in fact, is a load of BS.

Anything that indicates anything on a chart is to be treated with extreme caution unless one has invented it oneself which means that he has an edge. If he does make the mistake of attempting to explain it on T2W, he will, probably, be convinced by everyone that he is talking BS, himself, which would be a calamity if he was making money out of it beforehand.

So, if anyone has a good scheme, best keep quiet about it and make money all by himself.

 

[Hilarymannah]

Split link,.......... Behave old chap,... you obviously haven't a clue what you're drivelling on about, so rather than embarrass yourself,.........KEEP STUM!

 

[wackypete2]

So, if anyone has a good scheme, best keep quiet about it and make money all by himself.

Wouldn't be any fun here if we all kept quiet and made money.

"Shhhh, be very very quiet. I'm hunting pips"

Peter

 

[HowardCohodas]

"Shhhh, be very very quiet. I'm hunting pips"

Tell me your secret. I can't find any tracks in the woods on Saturday.

 

[Splitlink]

Split link,.......... Behave old chap,... you obviously haven't a clue what you're drivelling on about, so rather than embarrass yourself,.........KEEP STUM!

Maybe so.

I have to say that I do admire the ability those who do read tea leaves to get some kind of an edge for their trading.

At the same time, I believe that more people read tea leaves than they like to confess. Far better to say that they use "technical indicators".

 

[HowardCohodas]

At the same time, I believe that more people read tea leaves than they like to confess. Far better to say that they use "technical indicators".

Oh my. That's a low blow.