What's Wrong With Elliott Wave & Forecasting ?

Spiderman · #21 13th May 2007, 04:25 PM

cv I didnt see you attached chart. It is holy grail but do not give it to me
I am likely to lose money!!!

CreditViolet · #22 13th May 2007, 04:31 PM

Quote:

Originally Posted by Spiderman

kalyan Bhai,
leave alone the dogma. which method is ojective? which element of trading is not governed by human subjective mind? who is at the core of trading. method or trader. ofcourse trader. The subjective trader. nothing else. once we understand this our trading becomes objective. that is the only
truth. give a best trading system which you call objective to two different traders and see the results. One wins and other loses. Why? because of this human subjective mind.

A method is objective if one can calculate the odds in a numerical way ( can you do that with EW ).How a trader uses it is not the question here.We were not talking about the human element but about subjectivity of EW and its usefulness given its limitations.

CreditViolet · #23 13th May 2007, 04:36 PM

Quote:

Originally Posted by Spiderman

cv I didnt see you attached chart. It is holy grail but do not give it to me
I am likely to lose money!!!

I havent been able to find very accurate methods on daily data given the price shocks so it is not the holy grail.Chk it out, the theory behind is 100 times simpler than the first chapter of any EW book.

CreditViolet · #24 13th May 2007, 04:37 PM

Quote:

Originally Posted by kkseal

I am sorry to say, but this is dogma at it's worst. In order to make an objective assessment of any method one first needs to shed any emotional attachments to the same.

And nowhere has CV said that EW is conceptually wrong, he only questions the utility & the probability of forecasting success with the same (& also the need for forecasting in the first place).

It's ok for EW proponents to disagree, but where are the logical arguments in their favour?? All i see is some emotional responses (including denouncement of other methods which doesn't establish your cause in any way).

I don't know much of EW and am hence not in a position to comment on it's utility, but as far as forecasting is concerned here's my 2 cents :

First of all, all forecasting, irrespective of the method used, is an exercise of probability and not certainty (banking on the highest probability, at best).

All profit assessments are based on the future (the future may range from the next 2 bars to the next 2 years, but it's the future nonetheless).

All trade decisions are based on the past (the past may range from the previous bar to the last 5 yrs, but it's the past nonetheless).

The only thing that happens in the present - the NOW - is the trade execution, the Entry/Exit and trade monitoring (as the future becomes the NOW with every subsequent bar/tick).

Based on the above, i can't see how one can trade/invest without some anticipation of the future.

Regards,
Kalyan.

Well Said!

CreditViolet · #25 13th May 2007, 04:42 PM

Quote:

Originally Posted by amitt29

Y do u have to bring bhabhiji all the time here.

Well I have been backtesting and chatting here since morning and now both the computer box and wifey are getting hot.

.If I dont mention wifey every now and then, my days will be numbered here

CreditViolet · #26 13th May 2007, 04:51 PM

Hurrah! The work has finished. Time for some R&R now

All EW supporters rejoice, I am off now

I wanted to spend this week at the Experiments thread but alas, the EW debate turned interesting

Anyways, have a happy trading week lasses and watch Spiderman-3 in bhojpuri if you can

CV Out

amitt29 · #27 13th May 2007, 04:56 PM

Quote:

Originally Posted by CreditViolet

Well Said!

Alternation is the key.

kkseal · #28 13th May 2007, 08:24 PM

Quote:

Originally Posted by Spiderman

kalyan Bhai,
leave alone the dogma. which method is ojective? which element of trading is not governed by human subjective mind? who is at the core of trading. method or trader. ofcourse trader. The subjective trader. nothing else. once we understand this our trading becomes objective. that is the only
truth. give a best trading system which you call objective to two different traders and see the results. One wins and other loses. Why? because of this human subjective mind.

Take a basic MA crossover system (i am not for a moment contending that it's superior to any other, but just using it as an example). When it's a crossover, it's a crossover there aren't any two ways about it (on the charts what you see is what i see). Two or more traders trading the same stock during the same period based on the signals generated (without any additional discretionary inputs) will get the same results (whether good or bad). The same applies to backtesting. If independent testing is done for the same stocks over the same period using the same parameters the results would tally.

Now the question is, can the same be said about EW? Seemingly not. Moreover from what i learnt from one of CVs posts here (& the matter is as yet uncontested) that an EW method can throw up a large set of probabilities with each carrying equal weightage (that is there is no high probability or low probability scenario) To a neutral observer like myself this raises the question in my mind that what am i to do with such a method which leaves me in a 'coin toss' situation all the time?

Regards,
Kalyan.

Spiderman · #29 13th May 2007, 09:09 PM

kalyan,
Nope.a good trader will stick to his dicipline and win with his ma crossover a bad trader will become impatient wilth the gyrations of this system and lose despite the same system. What is the relevance of backtesting? In his book "entries and exits" Alexander Elder writes the only backtesting which he do is at the hard right edge and clicking every bar forward and noting down the buy and sell signals and testing them in future to gauze the testing becomes profitable or not. if it gives good results the method suceeds if not he drops it. This is how a system is tested. looking forward and not backward.
past patterns look so easy and you are lured into false comfirt they provide.

yes, elliott gives you discrition and it makes you a discretionary trader not a system mechanical trader. In the same book elder writes that a discritionary trader is better than a mechanical trader. Elliott is not a mechanical system so far so no software can analyse ew better than human mind. such mechanical system do not exit . Even adgets inventor admits that this is true.

If you want to search numerical tests for ew that's your choice but for me my
discrition has paid me with satisfactory results howsoever meager they may be. I do use indicators with elliott as other elliotticians do as an ancillary measure . But there are people who use only elliott on all time frames.
There are probabilities and multiple possibilities which some time confuse but their are methods to counter them. you can stay aside, you can switch to higher time frame you can use indicators etc. In the end a trader should follow the method with which he or she is comfirtable not what people want to impose on you.
regards,
spiderman

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