The truth about indicators

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Jox90
1018
Jox90  

I truly believed in technical analysis and algorithms potential and I searched a lot for two years a way two create an indicator with very accurate signals. I closed 30 jobs and made many indicators, but in the last period I realized what is the truth about indicators, using renko. I created a renko indicator and using it, comparing hundreds of indicators (made by me and not) I found that no indicator can give accurate signals, because with renko you can see what is the real accuracy of the indicator setting it to the smallest period/setting, and if, doing this, the indicator doesn't bypass the one single brick pattern (when there is only one renko brick in opposite direction) and if instead doesn't signal the two or more bricks pattern, that means that the indicator will never be accurate, even if you set it to a higher period, because if it doesn't work in the "small" it will not work in the "big". There is no indicator that can do this: there is no indicator that is accurate, even of sold indicators in the market. I learned that lesson the hard way: INDICATORS ARE JUST AN ILLUSION.

Marco vd Heijden
Moderator
8831
Marco vd Heijden  

Indicators indicate.

And they are good at it.

You have to define in what sense they are just an illusion, and what you mean by accurate signals.

Somehow the feeling creeps me up that you are trying to say that they are just an illusion 'for predicting the future' ... And they are, because that is impossible.

They are however very good at visually representing history.

It seems to me that the only illusion, exists in your mind, and that you have a misunderstanding of what an indicator is and what it could / should do.

But it's a good idea to shove all indicators into the trash, so that you can start focusing on things that do work.

Jox90
1018
Jox90  
Marco vd Heijden:

Somehow the feeling creeps me up that you are trying to say that they are just an illusion 'for predicting the future' ... And they are, because that is impossible.

You have a wrong feeling about me and about trading, because "predicting the future" is what trading is based on: if you buy is because you think that the market will go up...this is a sort of "prediction". If you don't have a strategy, a method, a way to "predict" the future you should not trading, because you will lose your money. I don't mean that indicators can predict the future...I mean that in whatever way you should have this goal in trading.

Sergiy Podolyak
3816
Sergiy Podolyak  
Jox90 :

I really believed in technical analysis and Algorithm Potential, and for many years I have been looking for a way to create an indicator with very accurate signals. I realized that the indicator shows that it can compare hundreds of indicators (created by me and not), and it discovers that no indicator can give accurate signals. period. /, and if the indicator does not bypass one single brick (when it is opposite, then only one Renko brick), that is, if it does not mean that it does not signal two or more bricks, it means that the indicator will never accurate even it does not work in

If there is a TS (trading strategy) - then you have EVERYTHING. Otherwise magic comes - the psychology of commerce, technical analysis, etc., which leads you to a loss.

Enrique Dangeroux
415
Enrique Dangeroux  
Sergiy Podolyak:

If there is a TS (trading strategy) - then you have EVERYTHING. Otherwise magic comes - the psychology of commerce, technical analysis, etc., which causes damage.

Well said.

My two cents:

Indicators are best suited for exit, not entry considering indicators show the past and that's all they do.

Marco vd Heijden
Moderator
8831
Marco vd Heijden  
Jox90:

You have a wrong feeling about me and about trading, because "predicting the future" is what trading is based on: if you buy is because you think that the market will go up...this is a sort of "prediction". If you don't have a strategy, a method, a way to "predict" the future you should not trading, because you will lose your money. I don't mean that indicators can predict the future...I mean that in whatever way you should have this goal in trading.

Yes i agree, but it's not about whether the market will go up or down.

You are barking up the wrong tree there.

You should not have the goal to try and predict the upcoming market direction.

With or without indicators.

Simply because it is unnecessary and also impossible.

It's the wrong end you are working on.

Jox90
1018
Jox90  
Marco vd Heijden:

You should not have the goal to try and predict the upcoming market direction.

What so?
Marco vd Heijden
Moderator
8831
Marco vd Heijden  
Jox90:
What so?

It's impossible to predict upcoming market direction.

But i can tell you something.

It is possible to predict the future to some extend.

Just not to predict the upcoming market direction, which is impossible and unnecessary. 

But i can predict to you, that i will not lose more then $20 on my next trade.

And that is my future prediction, and it is all i ever need.

No indicators no (impossible/unnecessary) prediction attempts of upcoming market direction, no nothing.

Just $20.

You give that some real good thoughts now.

It's the other end of the spectrum, i am predicting my losses, in stead of my profits.
rainwalker123
1349
rainwalker123  
Jox90:

I truly believed in technical analysis and algorithms potential and I searched a lot for two years a way two create an indicator with very accurate signals. I closed 30 jobs and made many indicators, but in the last period I realized what is the truth about indicators, using renko. I created a renko indicator and using it, comparing hundreds of indicators (made by me and not) I found that no indicator can give accurate signals, because with renko you can see what is the real accuracy of the indicator setting it to the smallest period/setting, and if, doing this, the indicator doesn't bypass the one single brick pattern (when there is only one renko brick in opposite direction) and if instead doesn't signal the two or more bricks pattern, that means that the indicator will never be accurate, even if you set it to a higher period, because if it doesn't work in the "small" it will not work in the "big". There is no indicator that can do this: there is no indicator that is accurate, even of sold indicators in the market. I learned that lesson the hard way: INDICATORS ARE JUST AN ILLUSION.

Hi Jox,

sorry, what you believe is not entirely correct, that indicators are an illusion. More over you have to be an expert and understand how every single indicator works, especially with mommentum, try and conbine different periods together hours after hours, day by day, to reduce false signals. The problem most coders have, is they dont have the experience and dont even know how to combine the timeframes, avoid saw markets and so on. A simple ZigZag indicator can catch turning points allmost perfect, used in the right way with a trendfollowing indi.  Before you reach the status of a protrader you have to sit on your chair, more than 10.000 hours. And believe me, there  are tons of strategys for everyone, but most traders dont have an iron patience. Best regards from munich.

rudysemail
56
rudysemail  
The market moves based on liquidity. Any indicator that doesn’t help you track that is probably a random signal. 

99% of indicators are some form of a moving average from price. So if putting a few MAs on your chart doesn’t help, you won’t find any magic in the other 99%. 
rainwalker123
1349
rainwalker123  
rudysemail:
The market moves based on liquidity. Any indicator that doesn’t help you track that is probably a random signal. 

99% of indicators are some form of a moving average from price. So if putting a few MAs on your chart doesn’t help, you won’t find any magic in the other 99%. 

Moving averrages are very usefull used in the right way, with all timeframes.

123
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