Mmm…you’re
dead right when you say that “almost anything works”. Or at least
can be made to work through sound money management and risk analysis/control. I
mean, to pick up on another current thread, just look at what the Turtles did.
Now there’s a loose set of entry criteria if ever I saw any – I’d
rather use the coin flipping example you made than that ‘system’.
But the point
is that the Turtle’s ‘system’ was much more than just entry
rules. And that’s what makes it difficult (but not impossible) to code
and back test their method. I think a similar, yet slightly different, problem
applies to Elliot, Gann etc. They are primarily discretionary methods of
trading since they rely for their success on a certain level of
selection/filtering by the neural network that resides in the trader’s
cranial region. Personally, as I have learned through painful experience, my own
neural netwok is not up to the job and so I shy away from these methods (cults?
religions?!) and stick to relatively much more simple systems that I can code,
back-test and then use systematically with the confidence that I have
some stats to back me up. I suspect you’re with me on that one s-frag?? I
suspect also that these successful fund managers that have been talked of who
use Elliot techniques, are simply better traders than I and have a better
intuitive sense of what the markets are telling them. Either that or they have their
“edge” in other respects…i.e. they have inside contacts
backed up with hoards of recently-graduated minions below them who do nothing
but crunch numbers and provide them with the most up-to-date IRRs, NPVs etc etc.
That helps. Whatever…I bet you they don’t use Elliot and nothing
but Elliot.
Problem is
that you can’t code human discretion…and that’s why you will
not get an answer to your challenge. The Ellioticians that I have encountered are
similar to the astrologers in that they are both “chart readers”
and therefore will not be able to give you a hard-and-fast set of rules that
they can back up with actual trading results. At least that’s my
experience and is why I too treat them with skepticism…not because I don’t
believe that they can make their own methods work, but because they don’t
gel with my own trading style.
I should point
out here that I have no experience of any Elliot, Gann or Astrological plug-in
for MS or any other charting package…and in that respect I would add my
voice to s-frag’s. If anyone can help me get over my skepticism and prove
what I have just said to be untrue (with numbers and code please) then I am all
ears. Can these methods be incorporated with success into a proven systematic
trading strategy? I suggest they cannot…at least not with current technology.
From:
superfragalist [mailto:no_reply@xxxxxxxxxxxxxxx]
Sent: Wednesday, December 29, 2004
5:45 AM
To: equismetastock@xxxxxxxxxxxxxxx
Subject: [EquisMetaStock Group]
Elliott Waves
Here's an old Connie Brown article from TASC.
Nothing in here says E
Waves work. Program E Waves into a systems tester
and see what you
get. You can't do it because there's no agreement
on what an E Wave
signal is.
http://www.aeroinvest.com/interviewSC.pdf
It sounds like Constance
is a chart reader, who uses Gann and Elliot
to give her confidence in her chart reading.
I'm not asking for the name of someone who uses E
Waves or Gann or
Murrey Math. I'm asking for a professional systems
developer who has
tested them in unbiased computer simulation tests.
Van Tharp and LeBeau have both done extensive
tests on random entries
where a coin was filpped for picking which stocks
to buy. Each used
some sound money management techniques and exit
strategies. In all of
their tests they had a profitable trading record.
The point is entry selection is not the problem.
Almost anything
works. At least with Van Tharp and LeBeau you
could test it. You
can't test E waves.
How do you explain people who use astrology for
trading. Have you read
Introduction to Astrological Technical Trading by
Myles Wilson
Walker
Contents
Planet glyphs, Wheel explaination Terms
Fixed (Automatic) Astro Cycles and examples
-Stock Indexes, Grains and Bonds
How to Find Fixed cycles for any Stock or
Commodity
Planetary Ingress, Retrograde - Direct planets as
a Cycle timer
Jupiter Ingress and Soybeans, Repeating Aspects
How to Find the Dynamic astro Cycle for any Stock
or Commodity
Natal Astrology, Bradley Indicator, Time by
Degrees
This sounds like Gann and Elliot all over again.
I've posted the reference several times to a site
that's based on
Asian astrology.
Use Four Pillars astrology and I Ching to time
your investment
decisions.
http://www.fourpillars.net/finance/index.html
If you track this guy, you'll quickly learn he's
right a lot of the
time. It's all in the year of the moon dog!
Gann and Elliot would have been all over the I
Ching. Count on it.
Too bad they didn't get that incorporated into
their trading sooner.
Those charts would have been much easier to read.
If have doubts about what I'm saying read: Fooled
by Randomness. That
should put some perspective into it.
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