General Trading Chat
- Thread starter timepass
- Start date
- Tags idle thoughts trading talk only
Keep It Simple
One of the most difficult things to get traders to understand is that no matter how much they research apply n number of indicator, they will probably do better if they did less and follow a single strategy. We as Human beings are wired to accumulate and analyzed lot of information ,This is certainly counter-intuitive, when we are trading.
This kind of failure mostly happens to those traders frequently regarded as the smartest. In essence, the more information that Trader have, the more opportunity that they have to choose the misinformation that suits their emotional purposes.
Speculation is observation, pure and experiential. Thinking isn’t necessary and often just gets in the way. Yet everywhere we turn, we read and hear opinion after opinion and explanation on top of explanation which claim to connect the dots between economic cause and market effect. Most of the marketplace is long on rationale and explanation and short on methods.
A series of experiments to examine the mental processes of doctors who were diagnosing illnesses found little relationship between the thoroughness of data collection and accuracy of the resulting diagnosis. Another study was done with psychologists and patient information and diagnosis. Again, increasing knowledge yielded no better results but did significantly increase confidence, something which the smartest among us are most prone to have in abundance. Unfortunately, in the markets, only the humble survive.
The inference is clear and important. Experienced analysts have an imperfect understanding of what information they actually use in making judgments. They are unaware of the extent to which their judgments are determined by just a few dominant factors, rather than by the systematic integration of all of their available information. Analysts use much less available information than they think they do.
source: internet
One of the most difficult things to get traders to understand is that no matter how much they research apply n number of indicator, they will probably do better if they did less and follow a single strategy. We as Human beings are wired to accumulate and analyzed lot of information ,This is certainly counter-intuitive, when we are trading.
This kind of failure mostly happens to those traders frequently regarded as the smartest. In essence, the more information that Trader have, the more opportunity that they have to choose the misinformation that suits their emotional purposes.
Speculation is observation, pure and experiential. Thinking isn’t necessary and often just gets in the way. Yet everywhere we turn, we read and hear opinion after opinion and explanation on top of explanation which claim to connect the dots between economic cause and market effect. Most of the marketplace is long on rationale and explanation and short on methods.
A series of experiments to examine the mental processes of doctors who were diagnosing illnesses found little relationship between the thoroughness of data collection and accuracy of the resulting diagnosis. Another study was done with psychologists and patient information and diagnosis. Again, increasing knowledge yielded no better results but did significantly increase confidence, something which the smartest among us are most prone to have in abundance. Unfortunately, in the markets, only the humble survive.
The inference is clear and important. Experienced analysts have an imperfect understanding of what information they actually use in making judgments. They are unaware of the extent to which their judgments are determined by just a few dominant factors, rather than by the systematic integration of all of their available information. Analysts use much less available information than they think they do.
source: internet
STji,
I have few questions from my today's trades. Its again a classical case of stochastic divergence. Can u please answer following question:
1. Can i take a risk and short low of the red candle(just after the virtual high) with SL above Virtual High ?
2. Was my add correct ?
3. What should be the SL for adds ? high of the sideways area ?
4. What should be right exit ? i kept my my SL above high of that big red candle at 11:50. Price just touched that area and then went back down, hence giving back a big profit. What could have been a better exit ? Can we use Stochastic for exits ?
5. Typically what is the ratio of entry and adds that u recommend. I typically take it as 4:3:2:1 i.e Rs.4 at entry, Rs.3 for first add and so on.
I have few questions from my today's trades. Its again a classical case of stochastic divergence. Can u please answer following question:
1. Can i take a risk and short low of the red candle(just after the virtual high) with SL above Virtual High ?
2. Was my add correct ?
3. What should be the SL for adds ? high of the sideways area ?
4. What should be right exit ? i kept my my SL above high of that big red candle at 11:50. Price just touched that area and then went back down, hence giving back a big profit. What could have been a better exit ? Can we use Stochastic for exits ?
5. Typically what is the ratio of entry and adds that u recommend. I typically take it as 4:3:2:1 i.e Rs.4 at entry, Rs.3 for first add and so on.
STji
Can this be called negative divergence ?
This is the criteria for negative divergence(please correct me if i am wrong):
1. Stoch should not make a new high, while price makes high.
2. Is it necessary that previous stoch should have crossed 80 ?
3. Does it makes any issue if stoch goes till say 30 or even 20 between this action ?
Can this be called negative divergence ?
This is the criteria for negative divergence(please correct me if i am wrong):
1. Stoch should not make a new high, while price makes high.
2. Is it necessary that previous stoch should have crossed 80 ?
3. Does it makes any issue if stoch goes till say 30 or even 20 between this action ?
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