Leading Indicators as Opposed to Lagging Indicators

[SOCRATES]

Now that you have achieved that, try using a Mark 1 Eyeball, which is akin to a patient finally recovered and being able to walk without his crutches. I stongly recommend it.

 

[TheBramble]

To all who were referring to my post about trendlines.

You are right if trendlines are used in traditional way, however after studying it and getting mentored about using them as leading indicator , I now believe that trendlines are the the best leading indicator I know about .

While trendlines are a vital aspect of TA it's the first time I've seen them referred to as a 'leading' indicator.

The indicator provides guidance to potential future price, but to ascribe 'leading' is I feel erroneous, unless you have information outside the ken of most traders who use them.

A lagging indicator is 100% correct in it's re-presentation (delib. punc.) of what has happened.

A 'leading' indicator (if such a term is used) would imply 100% correctness in what was about to happen.

 

[ottos]

While trendlines are a vital aspect of TA it's the first time I've seen them referred to as a 'leading' indicator.

The indicator provides guidance to potential future price, but to ascribe 'leading' is I feel erroneous, unless you have information outside the ken of most traders who use them.

A lagging indicator is 100% correct in it's re-presentation (delib. punc.) of what has happened.

A 'leading' indicator (if such a term is used) would imply 100% correctness in what was about to happen.

What I've meant was that trendlines can show you where the price is going and where is most likely spot for price reversal ahead of time .
There in nothing 100% in trading .

 

[Roberto]

Everyone is using terminology differently in this discussion. It happens very often here, but not normally quite as significantly as in this thread ...

an ma does illustrate the trend well ...

It does indeed; because that's what it is, really. A moving average is a moving trendline.

However, with an average line like this, who needs trendlines?

Who indeed? An average _is_ a trendline, but in my language that doesn't make either of them "leading indicators"!

 

[Splitlink]

To all who were referring to my post about trendlines.

You are right if trendlines are used in traditional way, however after studying it and getting mentored about using them as leading indicator , I now believe that trendlines are the the best leading indicator I know about .

Good luck to you if you have found an edge that helps you to trade well. All of of us are different. That's what makes the market. But it is an indicator drawn by you and using your criteria, which may not be the same as for others. Of course, that can be said for all trading decisions, using indicators or not.

Split

 

[RUDEBOY]

Does anybody here trade price only?

 

[Roberto]

Yes

 

[SOCRATES]

Yes, mastery of trading with price only is essential. Then all else is a luxury.

 

[RUDEBOY]

I agree, although i also use volume. I think trading should be simplistic, master the art of price only and the trading world should be your oyster, if you pardon the pun. But if somethings worth doing, it's worth oney.

 

[RUDEBOY]

UPS, missed a few words and letters there, but i think you get the drift.

 

[Splitlink]

Does anybody here trade price only?

I think some trade just by reading the ticker. I'm not that confident, I use a chart but no indicators
or volume except a longterm average for trend. Socrates will probably say that I don't even need that but I'm not that far ahead, yet!

Split

 

[RUDEBOY]

Just only ever reading ticker, i would have thought you would have to be like Dustin Hoffman in Rainman.

 

[SOCRATES]

I think some trade just by reading the ticker. I'm not that confident, I use a chart but no indicators
or volume except a longterm average for trend. Socrates will probably say that I don't even need that but I'm not that far ahead, yet!

Split

I will explain more when I have time.

 

[SOCRATES]

Just only ever reading ticker, i would have thought you would have to be like Dustin Hoffman in Rainman.

Right on the button ! I will explain in due course, when I have time, wife calling....

 

[roberk]

Does anybody here trade price only?

yes

 

[seven]

i use times series forecast and macd on strategy runner one minute chart for my indicators high strike rate
times series is set at at 5 and first two of macd is set at half the default
eminis only havent tried it on forex yet
seven

 

[mscir]

Interesting discussion so far. Splitlink got me curious about what people are watching every day.

If anyone's willing to post I'd like to know you have your screen set up. I use candle or bar for price, SMA(5), SMA(10), SMA(50) (just to see if I can make anything useful out of watching them), PSAR, RSI(14) and MACD (12,26,9).

 

[Rooster34]

I follow that entirely, Brambly One, but in my mind there's possibly some circularity in Goslin's argument, because it seems to me that he's inferring that the price will go up because the average goes up, whereas in reality the average will only go up because (if) the price has gone up. However, it's late and I'm more tired than usual and I concede that I may not be doing him justice, and I may not be doing you justice, and I may not even be doing DB justice (but he's probably used to that).

My take on dropping off the numbers is not that it affects the price but it draws your attention to what the price has been doing the last couple days and takes your eyes off the indicator. If it's been in a slow downtrend and then starts popping down and you focus on the indicator and not the recent price then you might miss a good opportunity to get in.

Just my take on it.

 

[Rooster34]

Wow didn't realize how old this thread was till I replied.

 

[sopodo]

I have always used candlesticks in my day trading of the emini s&p 500, I am only in a simulator still, will be going live soon. I would like to use indicators and have been looking into using these in my simulator. But I am a little lost. I have read tons about them in these past months of learning to trade.

In my simulator when I choose to add a moving average it asks me from a drop down box to choose from simple, weighted and exponential. When I choose for instance simple, then it asks me the day number. I read that day traders trading the emini s&p 500 like to use 4, 9 and 18 day moving averages. So I select those 3 figures. Then press okay and it loads up on my chart. But I now only see 2 lines, one is green and the other is red. Then I choose the macd and that enters another line on my chart which is blue. I use a candlestick chart on a 1 minute tick. The moving average lines do not seem in line with the candlesticks and rather too far apart which does not seem accurate, what's up with this?

If anyone can please help

Many thanks in advance