William Eckhardt

[new_trader]

Makes me smile when people down indicators, maybe it's EGO, wanting to look smart, "there is no differents" Example TD REI indictor is to add together the respective differences between the current bars high and the high two bars earlier and the current bar low and the low two bars earlier. These values will be positive or negative depending on whether the current bars high and low are greater or less than the high and low two bars earlier. So it is based on price, no different to trading price.

Then you get the so called traders who say, "I only trade price action." Well, you don't, most wait for a bar to be drawn. Example a 10 or 5 min bar...One would wait for a Doji or Engulfment bar be drawn before they would take action so you are slow on the move, "you had to waite"

Do tell me, what is trading price action only?......

Laptop1,

From what you have written I get the impression that you genuinely have no idea what trading price action is all about. A chart is useful because it gives a snapshot of what prices have done rather than what they will do. I prefer not using one to make trade decisions because it often impairs my judgement. I don’t know what you mean by “waiting for a bar to be drawn”. I don’t see any bars when I’m trading. All I see are prices and volume.

 

[Splitlink]

I cannot see how an indicator based on an average can forecast what is going to happen next unless the indicator is in perfect synco with the chart cycles. What you can say is, "If everything carries on exactly as before, I forecast that such and such will happen."

Neither, do I use dojis, thunderclouds and all that stuff. In fact, I use bars as much as candles and am very partial to line charts of the close of bars.

Now, I can see that a section of this thread is beginning to look on me as a big-headed, egotistical b*******, but I can assure you that I am not, really I, really, want to be loved , but I have tried all these indicators and, sooner or later, they disappoint.

I think that traders have far more fun constructing all this stuff than they do putting their money down.

Each to his own and Good Trading

Split

 

[laptop1]

Laptop1,

From what you have written I get the impression that you genuinely have no idea what trading price action is all about. A chart is useful because it gives a snapshot of what prices have done rather than what they will do. I prefer not using one to make trade decisions because it often impairs my judgement. I don’t know what you mean by “waiting for a bar to be drawn”. I don’t see any bars when I’m trading. All I see are prices and volume.

lol, been trading many years for a living. even you are waiting for price action by looking at time and sales and volume....even slower if you wait for volume to confirm your time and sales trades

So in a way everyone waits for price action whether it be in indicators waiting for a bar to draw or waiting for time and sale to confirm.

What about heavy volume WHEN PRICE IS MOVING IN TO RESISTANCE BECAUSE OF LARGE VOLUME.

More than likely prices would reverse at these levels prior to any penetration of S.R or a previous high or low. This is the only time I look for a bargain, I need heavy volume, that will indict to me its time to trade the opposite of the move...." would you call this price action".

The correct way to read time and sales is look than more than one market for divergence.

These days I keep it simple I don't mind waiting for the market to tip its hand. So I guess you cant call me a pure price action trader...But does it matter, I make money and that what's counts.

Do what works for you. keep it simple

 

[new_trader]

lol, been trading many years for a living. even you are waiting for price action by looking at time and sales and volume....even slower if you wait for volume to confirm your time and sales trades

So in a way everyone waits for price action whether it be in indicators waiting for a bar to draw or waiting for time and sale to confirm.

What about heavy volume WHEN PRICE IS MOVING IN TO RESISTANCE BECAUSE OF LARGE VOLUME.

More than likely prices would reverse at these levels prior to any penetration of S.R or a previous high or low. This is the only time I look for a bargain, I need heavy volume, that will indict to me its time to trade the opposite of the move...." would you call this price action".

The correct way to read time and sales is look than more than one market for divergence.

These days I keep it simple I don't mind waiting for the market to tip its hand. So I guess you cant call me a pure price action trader...But does it matter, I make money and that what's counts.

Do what works for you. keep it simple

No problems laptop1. I thought you had been trading for a long time because I followed your journal.

 

[Depth Trade]

The blind leading the blind

Probability 101 states that in order to measure statistics, one needs to measure the same Movement at the exact same time.( not taking one trade based off r.s.i. at 2:am, than the next a 5m)

Taking a position off an indicator, then taking another position hours later is a completely different trade, with different paramaters.

In order to compair positioning, the senerio would have to be based off the exact second and last the exact same amount of time (to the second) as the previous trades.

If not you are taking a different trade.

Indicators trade at say 40-50% win after spreads, add the fact that most positions traded will be completely new trades with new/different probabilty and you end up in a trading model that will be extremely hard to trade.


This is not to say traders aren't using indicators to help 'cherry pick' better positioning, but they definatly are not using Only Indicators to trade Currencies.

There may be people trading Bonds or gold using only indicators, but I think you find that in a non-trending/non-directional market as FX the absolute best traders are using a combination of Fundamental assesment with TA as the 'trigger' for positioning.


Think about it, if there is such argument to with is better, Why wouldn't the best traders in the field be using both?

They are.
DT

 

[rols]

Probability 101 states that in order to measure statistics, one needs to measure the same Movement at the exact same time.( not taking one trade based off r.s.i. at 2:am, than the next a 5m)

Taking a position off an indicator, then taking another position hours later is a completely different trade, with different paramaters.

In order to compair positioning, the senerio would have to be based off the exact second and last the exact same amount of time (to the second) as the previous trades.

If not you are taking a different trade.

Indicators trade at say 40-50% win after spreads, add the fact that most positions traded will be completely new trades with new/different probabilty and you end up in a trading model that will be extremely hard to trade.


This is not to say traders aren't using indicators to help 'cherry pick' better positioning, but they definatly are not using Only Indicators to trade Currencies.

There may be people trading Bonds or gold using only indicators, but I think you find that in a non-trending/non-directional market as FX the absolute best traders are using a combination of Fundamental assesment with TA as the 'trigger' for positioning.


Think about it, if there is such argument to with is better, Why wouldn't the best traders in the field be using both?

They are.
DT

Anyone who doubts the truth of this go look at the FX forums and system results. Without exception they all fail miserably in the end. Then it's a swift move onto the next system.

 

[nine]

Kiwi,

The burden of proof is upon those who make a positive proposition - I'm not making a positive proposition. Eckhardt and others, with plenty of expertise, are ready to demonstrate the failing of indicators. And a fanatic is simply someone who has undue enthusiasm - some people are fanatical about vintage cars, some religion and other it seems, indicators. No offence was intended.

You talk about the ability of others, and that is the issue - someone with only the basic rules should be able to make indicators work, if they really provide the edge that people evidently believe they do.

I don't believe that the few percent of would-be traders who go on to succeeed, do so because they happen to pick the right indicators. All the indicators I've seen present very clear signals as to what you are supposed to do - hwo can they "not work" because of the person using them? The signal is either there or not, a moron should be able to trade using indicators.

1. Eckhardt didn't reject indicators (that along with his supposed rejection of trendlines was a misquote by the OP), he rejected a certain type of indicator use because with the mechanical systems that he set up they lost money by betting against trends.

2. A moron can no more trade with indicators than with price alone.

3. Most who wish to trade don't make it. Some blame it on indicators. Some blame it on gurus. Some blame it on systems. Some blame it on day trading. Some blame it on market manipulation. It goes on. Reality is that they're wrong about the causes. I could (but prefer not to) trade with price alone - I could also trade with indicators alone (as could a number of my "can trade" trader friends but most of us don't).

4. If you failed to make use of indicators the issues lay within you. Trading is simple but it is not easy.

 

[daxdaytrader]

Hi Kiwi, thanks for clearing up what I had said in a misleading fashion about Eckhardt.

His negative comments on indicators were regarding over-bought and over-sold like stochs and RSI only - I think I mentioned that originally. It was my opinion alone that some people over-value indicators in general. If indicators alone were able to make effective traders, there would be far more winners.

Eckhardt was criticising lines based on angles (yes Gann springs to mind), then this is followed by a paragraph about trend lines, which he says are quite different. Although the book lumps the 2 together, on re-reading it is clear the intent is to contrast them.

Attached is one of those Gann fans that seems to prove how they do "work", and one of the DAX just out of interest because of the highs.

 

[wisefoolx]

Eckhardt is right and I agree, most TA is suspect not because it works or not(that is irrelevant) but because most are non-objective instruments because of the way they are calculated / produced.

 

[Quantt]

wow this is from 10 years ago

 

[wisefoolx]

HAHAHA.

True but still a very relevant topic.