The truth about indicators - page 3
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But there is a difference between -$20 and -$2000
Well said Jox90, or is it, Marco?
my 2cents:
None of the traditional indicators work. Indicators is what most of us start with and it's all so fascinating and convincing in the beginning... if only it worked in real life with real money (and after spread, commissions, overnight swap, slippage..). The more we know about technical analysis, the more voodoo we draw onto the chart. And then comes the point when we sooner or later realize, that it's all BS: at some point every trader in his/her career goes through this stage to realize that apart from price, volume, (orderbook), (news) anything else is useless.
This much is true: the past has nothing to do with the future. Price moves largely within the bounderies of the random walk hypothesis - until it doen't. The thing is: you don't know in advance, when this will happen (and no indicator can tell you), but you see it when it DOES happen.
I already wrote something similar in the german forum: don't trade your expectation, trade the surprise! Sure - you can try (and fail) to "expect" what the market will do next, but the real money is made when the expectation is wrong. There are several statistical methods to prove or falsify randomness and if something is incompatible with the randomness hypothesis, this is exactly when you should trade (and price dictates the direction).
People who believe in indicators just don't understand that an assumed lack of auto-correlation (with the past) doesn't mean that we can't have non-normal distributions and significant outliners that we can make a profit from.