No Indicators at all

[R0n1n]

Hi, while working on my system and trying out a few thing and tuning indicators etc I wondered if I could trade at all with out the support/handicap (depends on ur point of view) of indicators. Pure Price Action. At the most trend lines on the price chart.

So I thought to start an experiment where I try to trade on pure price action and no indicators. Won't be easy but no pain no gain.

So here is my first pick. BSL.
It held its support line and today it broke out of its wedge. The smart ones would have picked it at $10.00, but hindsight is such a b1tch

The question is : Has the next upside price wave started ? What would confirm it ?

The volume in the last two days has been average so will it support the rising SP ?

 

[nizar]

Can certainly work.
The turtle system used no indicators just pure price action.
And it seems they did okay

Try running the turtle system over the ASX over, say 5-10 years, and dont include the last 5 years. Its far from the best system in the world but it returns a few dollars.

 

[>Apocalypto<]

Hi, while working on my system and trying out a few thing and tuning indicators etc I wondered if I could trade at all with out the support/handicap (depends on ur point of view) of indicators. Pure Price Action. At the most trend lines on the price chart.

So I thought to start an experiment where I try to trade on pure price action and no indicators. Won't be easy but no pain no gain.

So here is my first pick. BSL.
It held its support line and today it broke out of its wedge. The smart ones would have picked it at $10.00, but hindsight is such a b1tch

The question is : Has the next upside price wave started ? What would confirm it ?

The volume in the last two days has been average so will it support the rising SP ?

Ron1n,

I have just stated to trade with indicators on indexes.

I still use a cci18 on FX but I will be taking that away as well very soon.

have made a trade, short on the xjo shorted at 4.20pm yesterday afternoon.

see how it pans out.

I am working towards not using them at all.

 

[>Apocalypto<]

Ron1n,

I have just stated to trade with indicators on indexes.

I still use a cci18 on FX but I will be taking that away as well very soon.

have made a trade, short on the xjo shorted at 4.20pm yesterday afternoon.

see how it pans out.

I am working towards not using them at all.

Closed this afternoon for 20 points.

 

[professor_frink]

The question is : Has the next upside price wave started ? What would confirm it ?

An indicator

 

[nizar]

An indicator

Exactly.
Indicators, due to their laggingness, are useful only in confirming price action.

 

[CFD]

The volume in the last two days has been average so will it support the rising SP ?

ROn1n, here is my take on this, with which I'm hoping those more knowledgeable and experienced will help if I go off the rails.

We are looking at price action and volume or VSA, which I hope I'm learning!
Look at the two ultra high volume bars and forget that charting software colours them red. Indeed turn the colours off if you can. Go with the premise that price rises looking for supply and falls looking for demand.

In relation to the first ultra high volume bar in early March, price had been falling, did it find demand? Yes. How do we know, because you can not have ultra high volume without it. There had to be that amount to match the ultra high selling and the price closed well off its low so after all that volume demand was still around at the end of the day. Although it's a supply bar, we can confidently say that demand intersected with supply. As MW would say, what was the response? Look 5 bars later, a small supply bar with very low volume. Jump on board or wait confirmation of demand volume?

In relation to the second ultra high volume bar in late June, the exact same thing can said. This time the, no supply left response, came on the next bar.

We have no such signals at the time of you question, my thoughts are as follows:

1/. All that professional buying on the two ultra high volume bars, I can not see on the volume chart where they could have sold. Should be bullish until they decide to sell.
2/. Look at that hugh down spike below 9.60 about 8 bars ago. With the low volume leading up to this, the cynical amongst us could think this was engineered to take out the stops. This was high volume on a wide ranging bar that closed a mile above its low. Last chance for the Professionals to get on board without pushing up the price with their own buying? In any case it should be bullish.

After the big white above you triangle it should be all go, but is the move half over on this bar?

 

[tech/a]

Hmmmm.

 

[tech/a]

CFD.The obvious is not so obvious.
Once you get your head around this stuff (And it will turn what you thought you knew on its head) it will be like a search light was switched on.

 

[wayneL]

<pedantic>But what is an indicator?

Sure oscillators and MAs are indicators. What about trend-lines, Fib levels, pivots, donchian channels etc. Are these also not derivative constructs of price, and therefore indicators?

Nizar mentioned the Turtles, who used a Donchian channel system. Donchian channels are still indicators in my book, as they derive from price history. They are drawn on the chart, referencing the previous hi/lo point in the lookback parameter, much the same as a moving average.

Even trend lines do this.

True indicator-less trading is just price bars... and nuttin' else.</pedantic>

 

[chops_a_must]

<pedantic>But what is an indicator?

Even charting the price could be deemed to be an indicator... given you never chart price alone. Of course that's if you want to go down this route.

I think it's very hard to use an out and out floor trading analysis without actually being a floor trader...

</pedantic+>

 

[wayneL]

Even charting the price could be deemed to be an indicator... given you never chart price alone. Of course that's if you want to go down this route.

I think it's very hard to use an out and out floor trading analysis without actually being a floor trader...

</pedantic+>

So indicator-less trading is a fallacy? I'd say so. We all (chartists) use some form of price interpretation... even if just labeling waves.

Perhaps the title of the thread should be "No Oscillators at all"?

</pedantic+> or </semantic+>

 

[R0n1n]

guys thanx a lot for replies. The reason I am trying not to use indicators is simple. If I don't know what the basic price action is telling me, then one tends to rely on indicators too much and I wouldn't know when the indicator has stopped working (think MA in a choppy market) cos I got no other reasoning to compare it to. Remember even a broken watch is correct twice a day.

CFD thats a great post. Plese keep them coming.

Here is ZFX. I have drawn two boxes, are they flag/pendentants ?

I have put dates on volume bars that I think signify a change. Something else I notice that before every move the volume drops quite a bit and then subsiquent SP rise is sustained by high volume bars.

So if we don't see a rising vol bar in the next couple of days should be get cautious that the there may be a SP drop coming ?

 

[ice]

ROn1n,

I use nothing but Point and Figure charts so I suppose that is close to 'no indicator' trading.

Happy as a pig in custard with them and never feel the need to delve into more arcane charting (although Candlestick charts are rather pretty).

The only slightly odd thing is that they only seem to work if I roll my own in Excel. I have used charting packages to create P&F's but they have no soul.

There's probably a million different ways to trade but in the end much of it is luck anyway.


ice

 

[explod]

ROn1n,

I use nothing but Point and Figure charts so I suppose that is close to 'no indicator' trading.

Happy as a pig in custard with them and never feel the need to delve into more arcane charting (although Candlestick charts are rather pretty).

The only slightly odd thing is that they only seem to work if I roll my own in Excel. I have used charting packages to create P&F's but they have no soul.

There's probably a million different ways to trade but in the end much of it is luck anyway.


ice

What a cop out statement. Luck.............luck....people like you should go away. If wheat is going up due short supply I want to be on wheat, is that luck or common sense. Common sense works for me all the time. We make our own luck by working at it, so it aint just luck IMHO

 

[motorway]

Well there are differences

We all want indications
Maybe not indicators

start with raw time and sales

We organize it into charts to help derive indications

some charts aggregate the time and sales into discrete units of time

and make price vs time charts of various types.
line , vertical bar , candles ...

The volume histogram at the bottom is a separate chart read in conjunction...

Some charts aggregate the time and sales into discrete units of price

Point and Figure , Renko , three line break etc

probably range bar charts

Then there are equivolume charts
and charts that aggregate by discrete units of volume

volume bars... also there are tic bars

We cut the territory into different maps
To gain perspective and derive indications

Indicators... can be either optimized with the attendant time constraint and distortion. Or they can be sensitive to the speed of the actual price volume activity ..

eg OBV is just a line that follows volume
a 10 day moving average is a distorted constrained (lagging ) view ...
That is it is always 10 days of data ......even though the action NOW might span 5 days now and 5 months then.. and speed up to make the next bar
where it all happens...

We want timely and sensitive indications
The use of charts and trend lines ( that are just straight edges )
can give Us all We need ...........And less misleading

All indicators can mislead

And with good reason

smart money only uses these things against Us

They create false liquidity that is there to take advantage of
If it is to someones advantage to do so.

So time and sales are collated into maps.
Possession of good maps have won wars.

But drawing fantasy lines over the maps often led to the loss of Wars
indicators second third and fourth derivatives of price and volume
are such fantasy lines..

motorway

 

[wavepicker]

A trader should first learn to postition from a bar chart and volume alone.
In my opinion, once a trader has become experienced at analysing price dynamics such as types of trends be it, creeping/struggling,corrective/distributive), normal trends(impulsions), and can differentiate between the two types, it becomes possible to position from countertrends(where most of the postitioning should come if one is good at this) from just looking at price alone, one can instantly gauge the momentum or rate of change of price relative to the preceding types of trends in play just by knowing about types of trends and patterns.

Their is no offset or lag to worry about.

In many instances indicators that are derived from price are nothing more than crude cutoff filters or smoothers at the expense of delay. Most are "dimensionless" and as such cannot give you much of an idea as to the magnitude of the fluctuations of price. An example of this is when indicators go into oversold and over bought ranges and the market keeps trending. So how high is too high and how low is too low?? I have managed incorporate Centered Moving Averages such they are a representation of the some of the dominant cycles in the price action and are phased to the price action. As such, estimates of price fluctuations can be made(in advance) as they move from one extremity to another as prices are hardly ever in equilibrium but rather passing through equilibrium to an extreme. This can then be used in conjunction with pattern of the trend as a confimation a trend maybe at risk of ending.

 

[theasxgorilla]

But drawing fantasy lines over the maps often led to the loss of Wars
indicators second third and fourth derivatives of price and volume
are such fantasy lines.

While we're out with war analogies, this one sounds like 'buy-and-hold',

"Hold fast and never retreat, never", Adolf Hitler.

Sorry, couldn't resist.

 

[motorway]

I have put dates on volume bars that I think signify a change. Something else I notice that before every move the volume drops quite a bit and then subsiquent SP rise is sustained by high volume bars.
So if we don't see a rising vol bar in the next couple of days should be get cautious that the there may be a SP drop coming ?

Very characteristic chart at the moment

And a good example of why you need to keep up to speed

Very clear stopping volume

demand took all the supply look at the volume and the ultra wide range on that bar on the 16/08

demand is seen to overcome supply
no doubt about it

the next bar is already a type of test

We get the rally that then makes your supply line doubtful.

Now do We get a lateral move consolidating the move
Or a secondary test of the stopping volume ( volume and thrust lessening )
That if successful then confirms that stopping volume as ending action
( It ended the down trend and turned it into a uptrend )
A selling climax..

In a selling climax weak hands handover there shares to strong hands

The floating supply is diminished...

And a strong technical position is built...



Also look at the relative strength situation
How strong was the bounce compared to the broader mkt and
it's sector peers ?

motorway

 

[motorway]

While we're out with war analogies, this one sounds like 'buy-and-hold',

"Hold fast and never retreat, never", Adolf Hitler.

Sorry, couldn't resist.

Exactly

He seemed to think enough lines on a map
would make the difference and If he believed in them
They would become real


motorway