It depends on your own psychology. Whether you believe in mean reversion, or whether you believe price is a train, and how strongly, will dictate what is easier for you.
This is the basic dichotomy: mean-reversionists versus "price is a train" people. And of course both are right; just never at the same time. Yuki Thursday, May 8, 2008, 2:50:32 PM, you wrote: s> Which is more psychologically threatening? s> 1. Catching a train by running with it and hopping on board? s> or s> 2. Standing in front of the train and hoping it stops to allow you on s> board, knowing very well that you could be on the wrong part of the s> track and it runs you over instead? s> #1 requires agility. But it's psychologically easy to do. s> #2 requires emotional fortitude. It's psychologically difficult to s> accept. s> --- In [email protected], Yuki Taga <[EMAIL PROTECTED]> wrote: >> >> Gee, then I guess I should give back my ~20 percent a year that is >> largely based on short-term momentum swings, yes? (I'm sitting plus >> 13 percent YTD this year already, as of yesterday, versus -9.3 >> percent for my Nikkei 225 benchmark.) >> >> You do have to be agile however. And you cannot overstay your >> welcome. But the money is there for momentum systems if designed >> and tested properly. >> >> "Support" exists, but everyone knows where it is. Exactly where it >> is. And somebody (I'll leave it to you to guess who) is going to >> ring the bell and tell you that (resistance failed) or (support >> failed). What are you going to do, then? You're going to stop >> yourself out of course. With a loser. >> >> Which is likely to be more profitable, and for a longer period of >> time? Systems that compel you to do the psychologically difficult, >> or systems that suggest that you do the patently obvious? >> >> Is there anyone beyond 7th grade that doesn't know where support and >> resistance is? Are there great systems that rely on widely known >> community knowledge? >> >> Look for a system that has good metrics, but a system that also >> suggests that what you need to do will be psychologically difficult >> for you to do, in spite of having back-tested results indicating s> that >> you are foolish if you *don't* do it. Then you are good to go, as >> they say. Good to go as long as you do it, of course. >> >> If your system is easy to follow (by that, I mean that it's >> psychologically easy for you to make the trades), it's probably a >> loser. And vice-versa. The best systems have good metrics, yet >> despite that they almost defy the trader (psychologically) to make >> the trades. There is no free lunch. >> >> Yuki >> >> Thursday, May 8, 2008, 11:50:01 AM, you wrote: >> >> >> s> Anthony, >> >> s> Do yourself a big favor. Don't waste your precious time on this >> s> earth with this kind of drivel. Chasing price with momentum >> s> indicators is not going to get you where you want to be. >> >> s> Coming up with a support/resistance system is all you need to s> make >> s> whatever you want from the markets. >> >> s> I've seen hundreds of traders get wiped out trying to go on the s> path >> s> you're following and all of the successful traders I've been s> around >> s> in the e-mini futures have used S/R as the foundation of their >> s> trading methodology. >> >> s> And, above all, embrace your emotions in trading because they s> teach >> s> you what you should and shouldn't do going forward. Computers s> learn >> s> nothing while you learn from every win and loss you make. >> >> s> Finding an edge in trading is easy. It's only hard if you're s> using a >> s> computer to find a needle in a haystack because you didn't make s> a >> s> good enough investment in real-time observations of the markets s> while >> s> researching an edge you'd like to trade.. That makes all the >> s> difference in the world for knowing what works and what doesn't. >> >> s> You'll come up with 10 edges to trade if you put the time in to >> s> experience a live market on a regular basis without trying so s> hard. >> s> It will bring out your imagination and creativity to find what s> you're >> s> looking for. >> >> s> I wish someone had told me that 4.5 years ago when I started s> trading >> s> the ER2 e-mini. It would have saved me a lot of time chasing >> s> nonsense. >> >> >> s> --- In [email protected], "ihsaham" <ihsaham@> wrote: >> >> >> >> Hai Tomasz, >> >> >> >> This is simple Jake Bernstein Momentum Formula for chart and >> s> scanner. >> >> Please help me give arrow buy and sell. Buy arrow is Green s> colour >> s> and >> >> Sell Arrow is Red Colour. >> >> >> >> I really appreciate and thanks for you in advance. >> >> >> >> Best Regards, >> >> Anthony Idic >> >> >> >> >> >> >> >> _SECTION_BEGIN(" $ Momentum "); >> >> >> >> >> >> /* Bernstein Momentum Indicator */ >> >> /* Set Scaling to Automatic, Show dates On, Percent On, Middle s> On */ >> >> >> >> Title = "Bernstein MOM Close - Ref(Close,-7)"; >> >> GraphXSpace = 5; >> >> Graph0 = MA(Close - Ref(Close,-7),1); >> >> Graph0Style = 5; >> >> Graph0Color = 29; >> >> Graph1 = MA(Graph0,5); >> >> Graph1Style = 1; >> >> Graph1Color = 32; >> >> >> >> >> >> DaysAgo =Optimize("DaysAgo",-28,-40,-16,4); >> >> Fast = Optimize("Fast", 1, 1,5,1); >> >> Slow = Optimize("Slow",28,16,40,4); >> >> /* Note: It is merely a coincidence that DaysAgo and Slow use s> the >> >> same parameter set. */ >> >> >> >> Buy = Cross( MA(Close - Ref(Close,DaysAgo),Fast), >> >> MA(Close - Ref(Close,DaysAgo),Slow) ); >> >> >> >> Sell = Cross( MA(Close - Ref(Close,DaysAgo),Slow), >> >> MA(Close - Ref(Close,DaysAgo),Fast) ); >> >> >> >> >> >> Short = Cross( MA(Close - Ref(Close,DaysAgo),Slow), >> >> MA(Close - Ref(Close,DaysAgo),Fast) ); >> >> >> >> Cover = Cross( MA(Close - Ref(Close,DaysAgo),Fast), >> >> MA(Close - Ref(Close,DaysAgo),Slow) ); >> >> _SECTION_END(); >> >> >>
