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Good thoughts Ira
How about some opinions on the single best book for the three item
mentioned.
1) Understanding the true nature of the market and it's participants.
2) Control of our emotions
3) Money management
Thanks a million
Denis
Rochat
denis@xxxxxxxxxxx
-----Original Message-----
From: Ira <ist@xxxxxx>
To: RealTraders Discussion Group <realtraders@xxxxxxxxxxxxxx>
Date: Monday, May 24, 1999 10:46 PM
Subject: markets
>The following was sent to me by another trader and does it ever sum up
>the
>old adage "K.i.s.s.":
>
>"We live in an age of total computerization. With the appearance of
>Omega
>Research’s
>Tradestation products, the world of trading has changed forever. Traders
>are
>now
>chasing after ever more exotic and complex indicators. TS now comes with
>
>about
>150 standard indicators, and it’s programming capabilities let the user
>develop
>any
>kind of kind of personal indicator the heart desires.
>
>The phenomenal sales revenues of Omega Research, and other vendors
>selling
>similar software (such as Metastock, etc), show how far our
>indicator-fascination has come. Those who own TS, or similar software,
>cannot
>comprehend how anyone could still survive without such software.
>
>No wonder that software vendors have such success selling us new
>indicators
>by mass mailings. No wonder that new traders on this forum often ask,
>“what’s the best indicator?”
>
>What is often overlooked is the fact that all these sophisticated
>indicators
>rarely improve the trader’s results.
>
>Asking, “what is the best indicator?”, is like asking Rembrandt,
>“hey Rembrandt, I want to paint like you. What kind of brush do you
>use?”
>
>If you can’t paint, changing brushes will not improve your painting
>much.
>If you can’t trade, going from one indicator to another will not improve
>your
>trading much. The basis of good trading does not come from indicators,
>it
>comes quite different sources.
>
>The basis for good trading comes from money management, control of
>our emotions, understanding the true nature of the market and it’s
>participants.
>
>Yet, we need to do some kind of analysis, to avoid trading purely by
>instinct
>(which is contrary to what we were brought up to do). If we don’t put so
>much
>emphasis on indicators, what should we then do?
>
>As Steve has pointed out so correctly, most indicators in use are
>calculated
>from data presented on your bar chart. Such an indicator cannot possibly
>
>contain
>anything that is not already present in your bar chart. The indictors
>are
>just
>another way of presenting what’s already contained in that same chart.
>
>The message then is clear: if you are currently trading and changing
>from
>indicator to indicator, stop your search! You will not find the Holy
>Grail in
>the
>maze of indicators. Go with what you already have, and try to become
>more
>familiar with the tools you are already using! Pay more attention to the
>
>basics!
>The bar chart is full of hints and messages. All we have to do is learn
>how to
>read it.
>
>For the new trader: Don’t worry about indicators. Don’t feel intimidated
>
>because your more experienced peers use indicator names you have never
>heard off before. Learn the basics! Buys some books that teach you how
>to
>work
>with a chart (such as the works of Magee or Murphy)!
>Try to recognize repetitive patterns on your charts! Try to figure out
>what
>really
>makes the markets tick! Learn how to understand the mass psychology of
>trading!
>
>And above all, keep your losses small!"
>
>Good day trading, Ira
>
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