Traderji.com - Online community for Indian investors & traders!


How many are enough???

Discuss How many are enough??? at the Technical Analysis within the Traderji.com - Online community for Indian investors & traders!; I have often seen that tachnical analysts use all available tools to arrive at trading ...


Go Back   Traderji.com - Online community for Indian investors & traders! > METHODS & STRATEGIES > Technical Analysis

Technical Analysis Discussion of all the principles involved in technical analysis.


Reply
 
Thread Tools
  #1  
Old 23rd March 2006, 03:48 PM
Member
 
Join Date: Feb 2006
Posts: 8
Thanks: 0
Thanked 2 Times in 1 Post
bkhanna1 is on a distinguished road
Default How many are enough???

I have often seen that tachnical analysts use all available tools to arrive at trading decisions.

I'm not sure if they do this to show off or that they find actual value in doing this. What tends to happen is the trading call becomes secondary to the analysis and often leads to lossess.

My question is to all the tachnical analysts out there. How many technical tools should one use to arrive at a reasonable decision about the market?

I tend to be very simple in my approach and sometimes very minimilistic. It works for me most of the time but my problem starts when the market stops trending and moves sideways......

So I guess my question is twofold. What is the bestway to trade a sideways market and what tools will help me make good trading decisions?

Thanks!



Reply With Quote
Sponsored Links
  #2  
Old 23rd March 2006, 04:26 PM
Super Moderator
 
Join Date: Jun 2004
Posts: 1,778
Thanks: 2
Thanked 785 Times in 126 Posts
Traderji has disabled reputation
Default Re: How many are enough???

ADX can be used to identify potential changes in a market from trending to non-trending. When ADX begins to strengthen from below 20 and/or moves above 20, it is a sign that the trading range is ending and a trend could be developing.

When ADX begins to weaken from above 30-40 and/or moves below, it is a sign that the current trend is losing strength and a trading range could develop.
Reply With Quote
  #3  
Old 23rd March 2006, 06:35 PM
Member
 
Join Date: Dec 2005
Posts: 335
Thanks: 4
Thanked 32 Times in 16 Posts
trader31339 will become famous soon enough
Default Re: How many are enough???

Quote:
Originally Posted by Traderji
ADX can be used to identify potential changes in a market from trending to non-trending. When ADX begins to strengthen from below 20 and/or moves above 20, it is a sign that the trading range is ending and a trend could be developing.

When ADX begins to weaken from above 30-40 and/or moves below, it is a sign that the current trend is losing strength and a trading range could develop.
Traderji,
can you throw some light on DIRECTIONAL MOVEMENT system? how to use it in trading.

I have read somewhere on net that if ADX rises for 3 conescutive days from its recent lows then it trending stock no matter even if its below 20 .
also tell us abt ADXR and the maximum use
Reply With Quote
  #4  
Old 24th March 2006, 08:31 AM
Super Moderator
 
Join Date: Jun 2004
Posts: 1,778
Thanks: 2
Thanked 785 Times in 126 Posts
Traderji has disabled reputation
Default Re: How many are enough???

The ADX gives important information on the market environment. Without being acutely attuned to the market environment you are doomed to fail. The ADX gives you market environment information par excellence. The ADX tells you if there is a trend present or not. It also informs you if it is early or late in a trend. The end of the most recent thrust of the trend is heralded by the ADX. It informs of a de-trending (correcting market), of reversal and renewal.

Wilder calculated that markets trend for 30% or less of the time and were non-trending or range bound for the other 70% of the time. Trend following indicators are lethal in non-trending markets and oscillators suitable to non-trending markets are murderous if used in trending markets. So with reference to the ADX you can readily determine which of the two main types of indicators you should be using in the current market environment. The table indicates the appropriate type of indicator for different ADX defined market environments.

ADX Score ADX Direction Appropriate Tech. Indicator to Use

0 - 15 Up or Down Range - Use Oscillators
16 - 20* Up Trend - Use Trend Following Indicators
21 - 40 Up Trend - Use Trend Following Indicators
> 40** Up Be Prepared For Trend To End
> 40 - 25 Down De-trending - Use Oscillators
24 - 0 Down Non-trending - Use Oscillators

* J.Welles Wilder originally suggested ADX of 25 or higher to indicat presence of trend. This is often late in confirming trend entry. Trends emerge from non-trends. Whenever the ADX is in a range of 16 - 20(25), you have three consecutive up moves in the ADX prior to a DI entry crossover, then the DI entry can be taken with a high degree of success.

** The turn down of the ADX at these levels, when it above both DI lines, almost always means the end of that trend. It does not necessarily mean trend reversal, more likely a period of retracement and consolidation. Time to exit. Stand aside. Reverse only on other evidence of trend reversal.
Reply With Quote
  #5  
Old 13th August 2013, 04:44 PM
sudoku1's Avatar
Member
 
Join Date: Oct 2007
Posts: 9,457
Thanks: 6,498
Thanked 13,899 Times in 4,817 Posts
sudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond repute
sudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond reputesudoku1 has a reputation beyond repute
Default Re: How many are enough???

Quote:
Originally Posted by Traderji View Post
The ADX gives important information on the market environment. Without being acutely attuned to the market environment you are doomed to fail. The ADX gives you market environment information par excellence. The ADX tells you if there is a trend present or not. It also informs you if it is early or late in a trend. The end of the most recent thrust of the trend is heralded by the ADX. It informs of a de-trending (correcting market), of reversal and renewal.

Wilder calculated that markets trend for 30% or less of the time and were non-trending or range bound for the other 70% of the time. Trend following indicators are lethal in non-trending markets and oscillators suitable to non-trending markets are murderous if used in trending markets. So with reference to the ADX you can readily determine which of the two main types of indicators you should be using in the current market environment. The table indicates the appropriate type of indicator for different ADX defined market environments.

ADX Score ADX Direction Appropriate Tech. Indicator to Use

0 - 15 Up or Down Range - Use Oscillators
16 - 20* Up Trend - Use Trend Following Indicators
21 - 40 Up Trend - Use Trend Following Indicators
> 40** Up Be Prepared For Trend To End
> 40 - 25 Down De-trending - Use Oscillators
24 - 0 Down Non-trending - Use Oscillators

* J.Welles Wilder originally suggested ADX of 25 or higher to indicat presence of trend. This is often late in confirming trend entry. Trends emerge from non-trends. Whenever the ADX is in a range of 16 - 20(25), you have three consecutive up moves in the ADX prior to a DI entry crossover, then the DI entry can be taken with a high degree of success.

** The turn down of the ADX at these levels, when it above both DI lines, almost always means the end of that trend. It does not necessarily mean trend reversal, more likely a period of retracement and consolidation. Time to exit. Stand aside. Reverse only on other evidence of trend reversal.
.....
Reply With Quote
The Following User Says Thank You to sudoku1 For This Useful Post:
indianroadromeo (16th August 2013)
  #6  
Old 13th August 2013, 09:37 PM
Member
 
Join Date: Aug 2005
Posts: 59
Thanks: 7
Thanked 12 Times in 7 Posts
mohan.nj is on a distinguished road
Default Re: How many are enough???

This quote from JOhn hayden of RSI might help us...

"If asked, many seasoned traders will tell a novice trader that it is important to focus on truly mastering one indicator. It is essential to know when and why an indicator is about to behave in a certain way. Once an indicator is truly mastered, the trader is able to apply his own unique perceptions and rules to it. Many inexperienced traders want to believe that they have mastered an indicator simply because they know its particular trading "rules" governing entries, exits and stops. The reality is that they "know" no more than any other trading novice. Consequently, they have no "edge" versus other traders when using a particular indicator, which is one of the primary reasons that 99% of all new traders lose their money."
Reply With Quote
The Following User Says Thank You to mohan.nj For This Useful Post:
durairajan (28th August 2013)
  #7  
Old 16th August 2013, 10:26 AM
Member
 
Join Date: May 2010
Posts: 4
Thanks: 13
Thanked 2 Times in 1 Post
indianroadromeo is on a distinguished road
Default Re: How many are enough???

Sudoku1 Sir,
Thank you very much for digging out such treasures in traderji.


Reply With Quote
Reply

Bookmarks


Advertise Here


Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off



All times are GMT +5.5. The time now is 12:40 PM.

Indemnity, Disclaimer & Disclosure Notice:
By visiting Traderji.com you automatically indicate that you agree to our Forum Rules, Indemnity, Disclaimer & Disclosure Notice and General Content Disclaimer Notice and indemnify Traderji.com, its associates and related parties of all claims howsoever resulting from the usage of the forum/site.
Disclaimer: Trading or investing in stocks & commodities is a high risk activity. Any action you choose to take in the markets is totally your own responsibility. You are recommended to make appropriate enquiries and seek appropriate advise before sending money, incurring any expenses, acting on recommendations or entering into any commitment in relation to any advertisement published here. Traderji.com does not vouch for any claims made by the advertisers of products and services. Traderji.com will not be held liable for any consequences in the event such claims are not honoured by the advertisers. Traderji.com will not be liable for any, direct or indirect, consequential or incidental damages or loss arising out of the use of any information by anybody mentioned anywhere on this site.
Disclosure: The information in this forum is neither an offer to sell nor solicitation to buy any of the securities mentioned herein. The writers may or may not be trading in the securities mentioned.
All names or products mentioned are trademarks or registered trademarks of their respective owners.
General Content Disclaimer Notice:
In light of our policy of encouraging candid, open exchanges of views and the rapid distribution of information originating from many sources, Traderji.com cannot determine the accuracy or legality of any information that may be uploaded to the forum. Opinions, advice and all other information expressed by participants in discussions are those of the author. You rely on such information at your own risk. You are urged to seek professional advice for specific, individual situations and not rely solely on advice or opinions given in the discussions. Since Traderji.com is an open and free discussion forum, any comments made by members of this forum in their posts reflect their own views and not of the owner or administrator of Traderji.com. Thus the owner/administrator indemnify themselves of all claims whatsoever and will not be liable or responsible for any members comments/views in this forum Traderji.com. Although we constantly delete all irrelevant content and/or SPAM, if you should find any objectionable or offensive posts made by members of this forum which you would like to bring to our notice for removal then please Contact Us.
 


Copyright © www.Traderji.com 2001 - , All rights reserved.

Recommended Websites - www.TradersEdgeIndia.com - www.TradingPicks.com - www.MasterOfTrading.com

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70