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How many here use Fibonacci ratios as a part of their routine analysis
techniques or inclusive in their systems? And how many reject Fibonacci
ratios as being worthless, and for what reason? or reasons.
MonteFrom ???@??? Wed Jun 21 06:45:13 2000
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From: "Kent Rollins" <kentr@xxxxxxxxxxxxxx>
To: "OmegaList" <omega-list@xxxxxxxxxx>
Subject: Re: A Quick Poll
Date: Wed, 21 Jun 2000 02:40:06 -0400
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At the risk of starting a Jihad...
Personally, I don't believe there is any scientific or statistical reason
why Fib ratios should work, but the fact is that there are people who swear
by them and make a living trading with them. It is undeniable. So how do I
explain the contradiction? Simple. The power of the human brain. I
believe that if you take almost any technique, apply it to the markets, and
study it diligently long enough, you will learn to trade with it
successfully. You could create a set of ratios based on 10% levels (10%,
20%, 30%, etc.), name them Monte's DecaRatios, study how the market bounces
off them and moves thru them for a couple of years and boom!, you're making
money. But it's not because of the magic power of 10, or because 10 is the
same number of fingers most of us have, or because S&P futures move in
tenths. It would be because you spent 2 years studying how the market
moves. The DecaRatios would be your frame of reference. But the real magic
is how you have come to interpret and anticipate the market's movements.
A couple of months ago, Bob Fulks posted a great explanation of how he
worked with fellow traders to mechanize the trading that they were doing
using indicators that they traded with. He would start out by asking them
to explain how they interpreted the indicator and then implement that in a
system to generate signals. Often times, the resulting system would
generate signals when it wasn't supposed to and wouldn't generate signals
when it was supposed to. So they would look at the places where it failed
and the person would realize that there were additional conditions that he
didn't originally specify and may not have been consciously aware of. Their
brain consciously or subconsciously discovered these conditions over time
and the person applied them to their trading as they watched the lines
scrawl across the screen. And over time they became a better trader. But
it wasn't always because of the indicator.
There are so many techniques out there. Pick whatever works for you. The
key is to find something that you can master, study it thoroughly, and keep
working with it enough to discover when to buy, when to sell and when to sit
out. If you're just starting out, the most important thing to learn is not
to lose your stake before you learn to trade. Of course, that's important
after you learn to trade too.
...so put me down for "No but they're not worthless"
Kent (still learning)
-----Original Message-----
From: Monte C. Smith <mcs@xxxxxxxxxxx>
To: Omega-List <omega-list@xxxxxxxxxx>
Date: Wednesday, June 21, 2000 12:24 AM
Subject: A Quick Poll
How many here use Fibonacci ratios as a part of their routine analysis
techniques or inclusive in their systems? And how many reject Fibonacci
ratios as being worthless, and for what reason? or reasons.
Monte
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