He was talking about McDonalds hamburgers main factory being moved down south and passing the 0 line = The Watford gap.
Indicators Are Not Liars
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He was talking about McDonalds hamburgers main factory being moved down south and passing the 0 line = The Watford gap.
counter_violent
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Anyone else going to play...UP or Down....it's only a bit of fun...4 charts showing classic divergence set up.
TT says all 4 down.
Anymore for anymore....will post the continuation charts later tonight.
counter_violent
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graemenash
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Just to chime in with my 2p... all IMHO of course
In my experience indicators are for the most part completely useless EXCEPT when using them to spot divergences. It's the only way to turn a lagging indicator into a leading indicator.
Divergences on their own are also for the most part completely useless EXCEPT when combined with solid support/resistance and subsequent price action confirmation, within the context of the current trend.
That should muddy the waters a little....
2George
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Exactly
Exactly correct, divergence first, S&R second - but add the set trap trendline as the confirmer and that is as near perfection in a nutshell as it is possible to get.
George
Exactly correct, divergence first, S&R second - but add the set trap trendline as the confirmer and that is as near perfection in a nutshell as it is possible to get.
George
Just to chime in with my 2p... all IMHO of course
In my experience indicators are for the most part completely useless EXCEPT when using them to spot divergences. It's the only way to turn a lagging indicator into a leading indicator.
Divergences on their own are also for the most part completely useless EXCEPT when combined with solid support/resistance and subsequent price action confirmation, within the context of the current trend.
That should muddy the waters a little....
graemenash
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Well without looking at multiple timeframe charts to determine whether these divergences are pointing to a resumption of the prevailing trend, or knowing the supp/res involved it's virtually impossible to say, but just for fun....
1) has already produced a bullish move from the bottom, followed by a failed re-test of the lows and a break of the most recent swing high.... i'd say UP but with a note of caution, on account of the fact that the MACD is already setting up with bearish hidden divergence.
2) effectively double trough macd divergence within the one large macd trough. decent reaction from the lows... i'd say UP
3) again a decent reaction from the lows has already been produced, with what looks like it could be a failed re-test so once again i guess UP
4) decent reaction from the highs followed by a failed re-test so I'd guess DOWN, whilst again noting that the MACD is actually setting up a bullish hidden divergence over on the hard right edge so any bearish move might not be very big.
I look forward to being wrong on 4 counts
2George
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I've had a look and whilst I only use CCI, the MACD shows divergence but at the points stopped there are no other confirmers so the jury is out until there is either a support or resistance followed by a set trap trendline cut.
It is positive divergence however and the suggestion is that the charts will go up but divergence needs a support or resistance to confirm it as divergence by itself is useless.
George
It is positive divergence however and the suggestion is that the charts will go up but divergence needs a support or resistance to confirm it as divergence by itself is useless.
George
Well without looking at multiple timeframe charts to determine whether these divergences are pointing to a resumption of the prevailing trend, or knowing the supp/res involved it's virtually impossible to say, but just for fun....
1) has already produced a bullish move from the bottom, followed by a failed re-test of the lows and a break of the most recent swing high.... i'd say UP but with a note of caution, on account of the fact that the MACD is already setting up with bearish hidden divergence.
2) effectively double trough macd divergence within the one large macd trough. decent reaction from the lows... i'd say UP
3) again a decent reaction from the lows has already been produced, with what looks like it could be a failed re-test so once again i guess UP
4) decent reaction from the highs followed by a failed re-test so I'd guess DOWN, whilst again noting that the MACD is actually setting up a bullish hidden divergence over on the hard right edge so any bearish move might not be very big.
I look forward to being wrong on 4 counts
counter_violent
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Ok there seems to be a little more interest today ...so i'll hold off posting chart updates until the traffic has died down .
Jaydee
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I know I am better off without indicators but it's kind of whatever suits you. I spent a couple of years of my trading life lost in indicators and I learnt an important lesson that they aren't for me and they never will be. Not saying that people really shouldn't use them though - you just have to be aware of their limitations.
Regarding divergence - it works as much as it doesn't. All it shows is that the current trend MAY be weakening - I can see that just by looking at a chart.
Ultimately, the only things that aren't lying are the aggressive orders being fired into the bids and offers of the order book - everything else is a visual representation of this type of action which is very subjective. Charts are 2nd order derivatives of this action, indicators are 3rd order and indicators derived from other indicators are 4th order.
sjrider2397
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Regardless of how some feel about indicators.. I am not sure that I would want to trade without my 2 emas and the macd.. with my settings of course.
I use averages, too. When I say that I do not use indicators, I mean the ones in a separate box under the price chart. I, also, use Bollingers because they refer to present price action with reference to an average. IMO the other indicators are history, as far as forecasting is concerned.
sjrider2397
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I agree with the other indicators as history, Whe I first started trading I tried them all. Now I use my ema to easily see wich way the trend is going, which I could do by just looking at a chart, I then use my macd to find a good entry price. I have decided that it is really easily to get in a winning trade. I have a hard time knowing when to get out. I always seem to leave alot of money on the table
bryanheath
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Bollinger bands, in my opinion, are the only indicator that is truly helpful and MACD to a lesser extent. CCI, RSI, and the rest are just too lagging to mean anything. A cross of a couple of moving averages can be a reminder for what you already should be recognizing in the price movement. I've studied everything from Elliot waves to Ichi Moku but knowing how to look at a chart (multiple time frames), candle formations, support and resistance, pivots, and analyzing price action is what will make you money in the markets.
There is no magic indicator - it just takes time to learn how price moves. For some people it comes quickly and for others longer. It took me nearly a year - over 20 hours a week to get it. It was time well spent.
There is no magic indicator - it just takes time to learn how price moves. For some people it comes quickly and for others longer. It took me nearly a year - over 20 hours a week to get it. It was time well spent.
That reminds of a millionaire that Livermore mentioned in his book. "I got rich by entering too late and exiting too early"
montmorencyt2w
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Not sure if this is deep or trite, but a phrase I came up with is:
"You win by not losing"
"You win by not losing"
bryanheath
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Fundamentals vs. Technicals
Wasp, with all due respect I agree with most of what you are saying but you are comingling market movers with central bank policy - unless you are implying that central banks are accumulating or releasing currencies to a degree that greatly affects the market. Certainly China has accumulated a huge amount of foreign currency, but has the Fed or the ECB? Is that what you are saying?
Also in regard to historic levels - do we look back to 2001to see the bottom on EUR/JPY? And can we really find historical support for the GBP/USD by going back to January of 2001? These are different times - we have never seen moves of this dimension before.
The huge increase in daily ranges in recent days shows that hedge funds and merchant banks are responding to short term price changes seen in the charts and not long term fundamentals. Frankly I'm happy to see this behaviour purely for selfish reasons as I am enjoying tagging along. On the whole it is probably a very bad thing to see such drastic fluctuations.
I have recently noticed a complete disregard for fundamental news releases at all levels of market influence - German IFO last month, BOJ rate change and many others over the last few months during the chaos. The market moves contrary to the fundamental news because it is not as bad as feared. This is essentially a fear driven market.
Certainly as retail traders we are at the bottom of the food chain, but fortunately there is a lot of fruit that falls to the jungle floor. And yes, in terms of major price movement, we are pretty much irrelevant which was one of your points.
Again I say a long term chart is reflective of those fundamentals that matter.
Best,
Bryan
Wasp, with all due respect I agree with most of what you are saying but you are comingling market movers with central bank policy - unless you are implying that central banks are accumulating or releasing currencies to a degree that greatly affects the market. Certainly China has accumulated a huge amount of foreign currency, but has the Fed or the ECB? Is that what you are saying?
Also in regard to historic levels - do we look back to 2001to see the bottom on EUR/JPY? And can we really find historical support for the GBP/USD by going back to January of 2001? These are different times - we have never seen moves of this dimension before.
The huge increase in daily ranges in recent days shows that hedge funds and merchant banks are responding to short term price changes seen in the charts and not long term fundamentals. Frankly I'm happy to see this behaviour purely for selfish reasons as I am enjoying tagging along. On the whole it is probably a very bad thing to see such drastic fluctuations.
I have recently noticed a complete disregard for fundamental news releases at all levels of market influence - German IFO last month, BOJ rate change and many others over the last few months during the chaos. The market moves contrary to the fundamental news because it is not as bad as feared. This is essentially a fear driven market.
Certainly as retail traders we are at the bottom of the food chain, but fortunately there is a lot of fruit that falls to the jungle floor. And yes, in terms of major price movement, we are pretty much irrelevant which was one of your points.
Again I say a long term chart is reflective of those fundamentals that matter.
Best,
Bryan
bryanheath
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