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Why it is possible to predict price movement?

  • #301
  • Oct 24, 2015 4:20am Oct 24, 2015 4:20am
Quoting Captain Jack
{quote} Are you sure we are looking for the same things here? Cause a pin bar sure means something to me -CJ- {image} {image} {image} {image} {image} {image}
Pinbars are all over those charts, and many gets taken out. How do we identify the right spot to search for a pinbar (or railroad or M and W on other timeframes)? Picking a few trade examples out of thousend of trades is not reliable, I am not saying that you can not do this, but me personally do not get enthusiast quickly and to believe something I have to see it with my eyes day by day live in the market and not from past charts and past trades because my brain would fit my perceptions with my beliefs.
  • #302
  • Oct 24, 2015 4:21am Oct 24, 2015 4:21am
Quoting Atokys
{quote} I agree the tone was quite strong. Don't take it personally, im always addressing my posts to the average poster whose conception of trading is to grab as many pips off the 1 minute chart before lunch. If I manage to shake up their settled beliefs then I think the tone is warranted. {quote} Thank you.
Here mate, this is just for you. Since the thread is about predicting price and you are a die hard non believer, which is ok, it's also about repetitive patters, which are predictive in nature, but forget that part..... I'm gonna share a pattern I adapted from my equities trading years. Jim Bulkowski wrote about these in his books on candle patterns on stock charts so I just adapted it to my forex trading. I call it BARF!

BARF stands for Bump And Run Formation - it is a price/volume exhaustion pattern that is easy seen and provides R:R trades of 20+ I made my bankroll with this.

Basically price follows a lead in trend line, with average to low volume. Then price BUMPS up with higher volume until exhaustion sets in and it price will either return to the lead in line, test and continue or break the lead in line and continue it's path... very, very profitable!

-CJ-
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A man is not defeated when he is beaten, he is defeated when he quits.
  • #303
  • Oct 24, 2015 4:27am Oct 24, 2015 4:27am
Quoting Mag357
{quote} Pinbars are all over those charts, and many gets taken out. How do we identify the right spot to search for a pinbar (or railroad or M and W on other timeframes)? Picking a few trade examples out of thousend of trades is not reliable, I am not saying that you can not do this, but me personally do not get enthusiast quickly and to believe something I have to see it with my eyes day by day live in the market and not from past charts and past trades because my brain would fit my perceptions with my beliefs.
Would a few hundred of those trade examples help you ?? I have plenty!

It's all about the levels and cycle that price travels.... but seriously, the thread is deviating away from the topic. A lot of what you are asking about is already covered in detail elsewhere...

This is the key that you may be missing! Where are the important pinbars? At the peak highs, at the peak lows and at the retrace points...

-CJ-
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A man is not defeated when he is beaten, he is defeated when he quits.
  • #304
  • Oct 24, 2015 4:32am Oct 24, 2015 4:32am
Quoting Captain Jack
{quote} it goes much lower... so what do they come up with to cause that??? -CJ-
The more disturbing interpretation is that there is no manipulation - it is the reality that is self-similar, and it just leaves its footprints in any available quantitative data. In this case what you (and I, to a limited extent) do, is divinate the real future from the charts, not different from divinating from coffee stains or flight of birds (if one were to subscribe to this interpretation, one should not dismiss such practices without careful study).

This interpretation would, if your extrapolation holds, imply difficult problems with Europe in the next years, possibly struggling with the influx of people from the middle East? Greece and/or UK leaving the EU? War?

In any case a huge mess, and even if the intent is manipulation, the suffering it causes will be real, which will make the event real in itself. Case in point the 2007 crisis and Dow signal where the crisis manifests itself as a sharp pullback/shakeout from the longer term trend. But entire countries' economies collapsed in effect.

k
  • #305
  • Oct 24, 2015 4:45am Oct 24, 2015 4:45am
Quoting kprsa
{quote} The more disturbing interpretation is that there is no manipulation - it is the reality that is self-similar, and it just leaves its footprints in any available quantitative data. In this case what you (and I, to a limited extent) do, is divinate the real future from the charts, not different from divinating from coffee stains or flight of birds (if one were to subscribe to this interpretation, one should not dismiss such practices without careful study). This interpretation would, if your extrapolation holds, imply difficult problems with...
I was thing along those lines as well and they are courting Turkey as a replacement for Greece inho. Another thing on my mind is the influx of so called refugees... all those healthy, fit military age men. What are they bringing with them and what are they going to do with it?

Time will tell cause something is on the horizon.

-CJ-
A man is not defeated when he is beaten, he is defeated when he quits.
  • #306
  • Oct 24, 2015 4:50am Oct 24, 2015 4:50am
Quoting Mag357
{quote} Pinbars are all over those charts, and many gets taken out. How do we identify the right spot to search for a pinbar (or railroad or M and W on other timeframes)? Picking a few trade examples out of thousend of trades is not reliable, I am not saying that you can not do this, but me personally do not get enthusiast quickly and to believe something I have to see it with my eyes day by day live in the market and not from past charts and past trades because my brain would fit my perceptions with my beliefs.
I do understand what you are saying but you really should try trading them on demo so you get a feel for what they are, which ones to enter on and how they form and act. In general, when you see the pin bars flipping over from the tops to the bottoms or bottoms to the tops, its a sign of reversal and they are trapping traders in those pins...

Some days I hate looking for any setups and just go out and play....

-CJ_
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A man is not defeated when he is beaten, he is defeated when he quits.
  • #307
  • Oct 24, 2015 4:56am Oct 24, 2015 4:56am
Quoting albchr
{quote} Since I was 4. (60cc Yamaha mini endure) .... That's just .... Sexy! Don't want to clutter things here so back to lurking/learning mode for me.
Cut my teeth on a Honda 70cc.... 1st real bike I had was a Kawasaki 750 twin back in the late 70's! Wish I would have kept her....sigh....

-CJ-
A man is not defeated when he is beaten, he is defeated when he quits.
  • #308
  • Oct 24, 2015 5:12am Oct 24, 2015 5:12am
Quoting Captain Jack
{quote} Cut my teeth on a Honda 70cc.... 1st real bike I had was a Kawasaki 750 twin back in the late 70's! Wish I would have kept her....sigh.... -CJ-
haha ... remember the Hondamatic 50's? Couple friends as a kid had them. My first real date was with the 79 Yamaha XS 1100 special. Midnight black and gold.

Not mine, just a pic from the net but pretty much the bike I had. I too wish I still did. The torque and rapid smooth acceleration from that 4 banger was amazing!
Attached Image
Ghost Rider - WWTBMD?
  • #309
  • Oct 24, 2015 5:17am Oct 24, 2015 5:17am
Quoting albchr
{quote} haha ... remember the Hondamatic 50's? Couple friends as a kid had them. My first real date was with the 79 Yamaha XS 1100 special. Midnight black and gold. Not mine, just a pic from the net but pretty much the bike I had. I too wish I still did. The torque and rapid smooth acceleration from that 4 banger was amazing! {image}
Sweet! Yamaha always made nice bikes...that's why I got the Raider I'm on now when it first hit the market. That was an older pic of mine, need some new ones of the old girl. Got a Mustang seat with a backrest on it now and swapped the brap...brap street sweepers for a fantastic Vance and Hines 2-1... what a trumpet on that one!

-CJ-
A man is not defeated when he is beaten, he is defeated when he quits.
  • #310
  • Oct 24, 2015 5:28am Oct 24, 2015 5:28am
Quoting kprsa
{quote} Here, look at the yearly price of EURUSD and gold (black line) and the net positions (histogram) of Oanda customers (retail/dumb money/losers). You should notice the inverse correlation between the price and the net retail position. The price in general appears to work its way easily (small or no pullbacks) when the dumb money is on the wrong side and increasing their position (what I call irrational behaviour). When the dumb money on average catches up with the trend, the pullbacks appear - typically to the Gann's half the swing size rule...
Quoting kprsa
How else could it work?
I think you're inverting the cause and the consequence. The market doesn't reverse down because the retailers are long. It is the opposite!

Retailers take profit immediately when they are in trend and let their losers run during adverse move. See how many threads in the Systems sections say something in the like "Make sure you go in the direction of the daily trend. I take 10 pips and call it a trade. Yeah I know my SL is much bigger than my TP but you know I've a 90% winrate so who cares? Compounding will me you rich pal!"

Say there is a strong up trend. When they catch 10 pips they wait for another signal to enter again. They prefer momentum trade because they prefer high winrate. Therefore the next entry will usually be higher in the up trend. Out of a 250 pip trend they catch 5 times 10 pips and feel happy of the 100% success they had this week. When a pullback happens and they are in a trade they lose 40-50 pips because their SL is much bigger than their TP (you know they prefer high winrate).

Notice how their money management, you know the thing that is key in trading, helps in killing them. Because they win more often than they lose the lot size increases. So when the loser comes not only it is bigger in pips but the value of the pip is bigger too.

In short when you have a strong up trend the retailer are either wrong holding a short loser or out of the market because they already got their 10 pips. In average you see much more retailers holding a short position in a up trend (and v.v.). Nowhere the banks or brokers had to run any SL. They are not even involved in the process except for the fact that the money comes in their pocket.
No greed. No fear. Just maths.
  • #311
  • Oct 24, 2015 5:43am Oct 24, 2015 5:43am
Quoting PipMeUp
{quote} {quote} I think you're inverting the cause and the consequence. The market doesn't reverse down because the retailers are long. It is the opposite! Retailers take profit immediately when they are in trend and let their losers run during adverse move. See how many threads in the Systems sections say something in the like "Make sure you go in the direction of the daily trend. I take 10 pips and call it a trade. Yeah I know my SL is much bigger than my TP but you know I've a 90% winrate so who cares? Compounding will me you rich pal!" Say there...
I wrote about the archetypal dumb money strategy and money management before.
Note that taking profit from a short trade is equivalent to buying, i.e. filling somebody else's short order.
The whole point is that retail on average (for highly traded assets where you can get good stats, this doesn't work for crosses well, for example) represents dumb money everywhere. And that dumb money fills the orders of smart money in the real market. The air in the bottle (retail, Oanda subset) has the same properties as the air in the atmosphere (dumb money), on average.
Cheers,
k
  • #312
  • Oct 24, 2015 5:49am Oct 24, 2015 5:49am
Price is random, but random can be structurized. And because random has structure, we, traders, can make edge.
  • #313
  • Oct 24, 2015 5:51am Oct 24, 2015 5:51am
9
Quoting albchr
{quote} haha ... remember the Hondamatic 50's? Couple friends as a kid had them. My first real date was with the 79 Yamaha XS 1100 special. Midnight black and gold. Not mine, just a pic from the net but pretty much the bike I had. I too wish I still did. The torque and rapid smooth acceleration from that 4 banger was amazing! {image}
Nice Bike Chris.Love old style bikes.I have old CB750 and love it.One of the best old time engines ,air cooled simple.Now these days everything is super compact just to get to engine you must remove half the bike...on top of it just about everything looks like a transformer...
This is why BMW hit it on the nail with T9.Wonderful,beautiful,powerful machine and there is waiting list to buy.
Xc 1100 is hot bike to turn into cafe racer.Very easy to make it look super cool.
You can still buy in CL cheap.
Regards
In trading, you have to be defensive and aggressive at the same time
  • #314
  • Oct 24, 2015 6:01am Oct 24, 2015 6:01am
I think that while it's random, there are proven points of resistance and support that show significance. Breakouts or false moves can be predicted around these areas. It's about making trades with high probability. It's true that you will never win 100% of your trades no matter who you are. Find a strategy and stick to it.
  • #315
  • Oct 24, 2015 6:05am Oct 24, 2015 6:05am
Quoting dreamt1me
Price is random, but random can be structurized. And because random has structure, we, traders, can make edge.
Then it is not random, it's a contradiction. Random is random.
  • #316
  • Oct 24, 2015 6:08am Oct 24, 2015 6:08am
Quoting dvdsurplus
I think that while it's random, there are proven points of resistance and support that show significance. Breakouts or false moves can be predicted around these areas. It's about making trades with high probability. It's true that you will never win 100% of your trades no matter who you are. Find a strategy and stick to it.
Those areas you speak off, which I refer to as "areas of interest" are created by those who pilot price and not the traders themselves. Many are actually false S/R areas and they are created to pull both buyers and sellers to an area of common interest, whereby a greater number of transactions can be created, allowing price to move greater distance in a more rapid manner... Transactions are the fuel of price movements.

-CJ-
A man is not defeated when he is beaten, he is defeated when he quits.
  • #317
  • Oct 24, 2015 6:28am Oct 24, 2015 6:28am
Quoting kprsa
{quote} I wrote about the archetypal dumb money strategy and money management before. Note that taking profit from a short trade is equivalent to buying, i.e. filling somebody else's short order. The whole point is that retail on average (for highly traded assets where you can get good stats, this doesn't work for crosses well, for example) represents dumb money everywhere. And that dumb money fills the orders of smart money in the real market. The air in the bottle (retail,...
Hi K
In greater scheme of things retail traders don't move price.Simple as that.Weather dumb or smart.
regards
Also noticed in general lots of retail traders are not interested on fundamentals as much as they should.This aspect is baffling to me.
Idea that "everything is in the chart" in basic concept is flawed.Everything is not in the charts.
ECB last meeting proves my point.I posted numerous articles that one should sell the Euro based on fundamentals.
Anyway just some view.
In trading, you have to be defensive and aggressive at the same time
  • #318
  • Oct 24, 2015 6:34am Oct 24, 2015 6:34am
BARF indeed Captain Jack!! I couldn't resist having a scan of the EURUSD chart to see what I could find, and lo and behold:

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  • #319
  • Oct 24, 2015 6:37am Oct 24, 2015 6:37am
Quoting Davit
{quote} Hi K In greater scheme of things retail traders don't move price.Simple as that.Weather dumb or smart. regards Also noticed in general lots of retail traders are not interested on fundamentals as much as they should.This aspect is baffling to me. Idea that "everything is in the chart" in basic concept is flawed.Everything is not in the charts. ECB last meeting proves my point.I posted numerous articles that one should sell the Euro based on fundamentals. Anyway just some view.
Most retail traders orders actually never hit the market...they are kept in house at the broker and house traders take positions against them...

-CJ-
A man is not defeated when he is beaten, he is defeated when he quits.
  • #320
  • Oct 24, 2015 6:39am Oct 24, 2015 6:39am
Quoting kk007
This sounds a simple question, but it is not indeed. There are a lot of trading methods claim working. Nevertheless, I wonder in general what logic these methods based on in predicting price movement. Can anyone give me a good answer? Thanks, kk007
because trading is acting that people do and behave ,if i knew all will buy a certain stock and the amount of that stock i will know where price will go in direction up to the pip ,so actually we are studying people action towered an instrument from charts and thats what make price predictable just my two euros
focus while relaxed to see better
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