Dangers of information overload and people who post charts
I'll tell you what Riz; after looking at the postings on that link it certainly makes me appreciate the efforts of the likes of yourself, Chartman and Naz as good technicians who can post a readable chart.
To be blunt.
Java. (And all the newish traders). Save yourself months of going around and around in circles, you may well disappear up your own backside.
Why do you want to write your own studies at this stage?
Keep it simple. You have to avoid information overload.
Of course I am assuming that you are not a rocket scientist with 20 years of trading behind you and can 'write' studies in a matter of minutes. Use what you have in front of you. Don't try to be different... yet.
When anyone starts off in this or any other 'game' for that matter, they learn a bit, then a bit more. This then leads to aquiring more knowledge and it's 6 months before you start trading.
And you still won't know how to trade.
You want to be a trader. Then trade.
'Yes' I hear you saying. 'But I have to have something to base my trades on'
Yes, you do. And it's all in the charting package in front of you. Learn the basics of that and how to use it. (This is all asuming that you intend to trade real time and not for the long haul which is really investing and something else entirely.
You want to do it all at once so you have a deep understanding of markets and trading, and that is normal. But it takes a long long time to assimilate that information, and even longer to learn how to use it.
Sadly people tend to go too far in the search to make themselves a better trader and lose sight of the prime objective.
While not wishing to be detrimental to anyone and this is purely my personal view. Those charts in the above link will screw your brain up if you try to understand and follow them. And also remember that two people can see the same chart and come up with diferent views. But these people have posted examples on a site so can be considered fair game.
All the lines on the charts were drawn after the fact, and trading in hindsight is very easy to do. I'm right 100% when I do, though sadly will never make a single penny using that method.
The first poster shows 'hidden divergenge' and 'normal divregence' on the second chart. Bear in mind that you can see the whole chart in one go. Well, I think the guy is not using his mouth here to talk. It all follows the market quite nicely as it would be expected to do so if you follow it on a tick by tick as it would unfold on a live chart. There are some great trading set ups there but the hidden/regular divergence has nothing to do with it. For proper examples of divergence see Chartmans posts on the dow.
On the 3rd chart the poster has marked hidden divergence.
It's not.
And all those lines on the other charts...
The second poster is even worse with the lines. Well. I think all anyone can say about that is he could have saved himself a few hundred dollars and bought himself a 'spirograph' instead.
Again, I want to reiterate that I have no intention to knock anybody, For all I know those guys might be multi millionaire traders.
My message is just to keep it simple, don't get sucked into time consuming this that and the other.
If you have a look at the metastock site there is a link to a technical thing by Steve somebody or other (can't remember who. Must get a new brain) that shows all the indicators with explanations.
Confused?
You will be.
Options.
