Author Topic: Popular Indicators  (Read 653 times)

eddieb

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Re: Popular Indicators
« Reply #15 on: September 21, 2020, 08:46:44 AM »
EURTRY
Theres an exception to every rule.
Disclaimer. Posts are just my thoughts,  not recommendations.  Do your own due diligence before trading

eddieb

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Re: Popular Indicators
« Reply #16 on: October 09, 2020, 10:55:16 AM »
I have never been a great follower of indicators personally. When I started out I used a 60 sma to identify trends, but found after a while that I could see these without the sma just as easily.

Support and resistance lines I do use, although they arent really an indicator and can be subjective (how you draw them, how much weight you give to them in different time frames). Certainly these are useful warnings of areas where price may hesitate or even reverse direction, and can give you clues as to where to position TP or Stops.

I think the name 'indicators' is misleading and certainly a lot of new traders take it literally and think they give 'predictions' of what is going to happen, but the name is stuck so I'll just have to accept it.
Disclaimer. Posts are just my thoughts,  not recommendations.  Do your own due diligence before trading

Gazza

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Re: Popular Indicators
« Reply #17 on: October 16, 2020, 09:48:27 AM »
Ive just listened to a radio interview pipmehappy posted a link to by Julia Cordova. She is a successful trader, been trading 6 years (I think) so knows her stuff.
What she was saying is that she can look at some indicators on charts that other successful traders are using and not have a clue how they make them work, but can look at others and see straight away. She says, and I agree, we need to find something that we understand and can make work for us, and that all strategies/indicators can work but not for everyone.

Kaitsu

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Re: Popular Indicators
« Reply #18 on: October 16, 2020, 11:50:29 AM »
we need to find something that we understand and can make work for us, and that all strategies/indicators can work but not for everyone.
The key issue underlying this is that we should always understand what we add to our charts and why. "Understanding" it means learning how it is constructed, what it is meant to reveal or "indicate", and how it functions with respect to various types of market movements.

Our most important charting tool is actually not on the chart at all - it is between our ears. And we cannot use our brain to understand what we are seeing on our charts if we don't even know what the tools there are supposed to do and how they behave.

There are basically two types of technical trading. One type is the mechanical systems that automatically obey preset rules for entries and exits. If these work then there is no need to understand anything. The other type are the most common and involve some degree of personal appraisal and decision-making. i.e. discretionary trading. It is here that  the personal input is often so under-rated. @thescruff often says "trade what you see" and that is true. But it is also true that if 10 traders were to use the same discretionary method on the same market they would end up with 10 different results. 

Therefore, we do need to analyse our own psychology and habits as part of our overall trading. That is partly the reason why some people succeed with one sort of strategy whilst other succeed with something different. We all need to know what suits us best regardless of what others do.

As a personal example, I know that I cannot trade long term, it does not suit my personality or circumstances at all. But I can day trade just fine. I also know that I perform better only looking for a standard optimised preset target pip values even though I usually miss out on the occasional long steady trends.

Know oneself and know one's chart content and you are over half way there........
« Last Edit: October 16, 2020, 11:55:23 AM by Kaitsu »
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Kim

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Re: Popular Indicators
« Reply #19 on: October 24, 2020, 06:44:58 PM »
Hiya!
Would I be right in thinking that channels are basically support and resistance lines that ignore horizontal plane? And would you class them as indicators or not ( I  assume support and resistance lines aren't counted as indicators)?

Kaitsu

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Re: Popular Indicators
« Reply #20 on: October 24, 2020, 08:32:22 PM »
Would I be right in thinking that channels are basically support and resistance lines that ignore horizontal plane? And would you class them as indicators or not
You would be right and you would be wrong! And no they are not indicators and yes they are indicators! :D

It depends on what kind of channel you are thinking of. For example, a channel can be a manually-drawn pair of lines encompassing successive highs and lows in order to identify the extremes of movements within a current trend. This is not an indicator but could also be a horizontal channel defining a ranging market and not just a bull/bear trend.

But there are other forms of channels which are indicators by nature. A simple example would be a channel formed by 2 MA's with the same period where one is based on highs and the other is based on lows. The idea being that when price breaks out of the channel then a new move is starting (I don't recommend this!), Similar indicator-type channels can be based on Fibonnacci sequence or Gann lines etc.

In a broad sense, I think you can define an indicator as something that is based on a mathematical calculation, whereas anything drawn according to visual observation is just a line and is unique to the price action being observed at the time of drawing and therefore, perhaps, of greater value.

Channels do have some value but one must always remember that no two trends/moves/waves are the same and therefore sometimes they will work - and often they will not. Again, hopefully, money management rules will control that the losses from the latter are less than the gains from the former - or another indicator/method is used to give confluence and thereby avoid some fake breaks.
« Last Edit: October 24, 2020, 08:35:23 PM by Kaitsu »
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