Divergences: Indicators?

[michaltrade 10]

Very good discussions on both sides indeed!!!

Special thanks to Raul, VIP, ... for a very practial "real world" trading.

[DrPepper 10]

I frequently hear people talk about the importance of reading price action or reading tape. But I never see any specifics about how to learn this method. Any suggestions other than "time and experience"?

[DbPhoenix 42]

I frequently hear people talk about the importance of reading price action or reading tape. But I never see any specifics about how to learn this method. Any suggestions other than "time and experience"?

 

Start with Wyckoff's Day Trader's Bible, attached as a pdf below. Then,

 

Techniques of Tape Reading

 

Tape Reading and Market Tactics

DTB, 1919.pdf

[BlowFish 10]

I frequently hear people talk about the importance of reading price action or reading tape. But I never see any specifics about how to learn this method. Any suggestions other than "time and experience"?

 

Wow old thread having said that an interesting one. To me reading PA and the tape are kind of different things, though related. To me PA is about how price moves. Higher highs/lows, ledges, ranges etc. I think in the past I have posted a whole bunch of references. But a couple of quick (free) ones of the top of my head...check out Joe Ross' law of charts and The first couple of Fibonacci trader journal entries about Gann swing chartist. 'Buffy' did an article for Ensign Software too.

 

Theres a whole bunch of stuff by market 'old timers' (like Dunnigan for example) that are of value and 'grandfathered' this stuff.

 

If you want to learn about the 'tape' (which rolls volume into the mix) then as DB says Whycoff is the guy to start with. To be honest I would start with 'plain' PA as its somewhat more straightforward.

 

Cheers

[drsushi 10]

Question, I've read on this thread that everything can bee seen in price. If divergence by definition is price moving one way while an indicator is moving the opposite direction, how can divergence be seen in price alone? Doesn't the concept of divergence require a second data point or source? Also, isn't a divergence just a heads up as to what may happen and not and indication of what will happen? And, aren't there indicators that have a volume component (Klinger volume) to them so that if there is a divergence part of that divergence is based on volume. I see many posts on TL that discuss price/volume divergences. Is that not part of VSA?

 

I just finished reading Trading in the Zone and from what I read and from my experience of being good a losing, it's more about what is between the ears then the method. If we have hour "minds right" then the rest will work itself out as long as the method over a reasonable number of trades provides a high enough percentage of winners to make one profitable. That doesn't mean 80-90% because money management plays a roll too. It seems to me, unless I am completely wrong that the order of importance is 1. mind right, 2. money management and 3. method. Please let me know if I'm full of it.

 

David

[brownsfan019 17]

It seems to me, unless I am completely wrong that the order of importance is 1. mind right, 2. money management and 3. method. Please let me know if I'm full of it.

 

David

 

David - IMO, the game that goes on between your ears is the toughest game of all in the markets. How many times have you 'gotten you too early' or 'got out too late' or 'missed a trade b/c I didn't like it', etc. etc.

 

That's all mind games.

 

And the hardest part of all in trading IMO. I think you nailed it on the head. Yes, how you trade is important, but it means nothing if your mind is not in the game and ready.

 

This 'game' we play requires an immense amount of focus and determination. This 'game' we participate in will punish you severely for lack of focus or mindset. This 'game' does not allow you to casually take a day off and be ok the next day.

[fxtrader12 10]

[...] You can safely assume as fact that some people trade better with indicators and some trade better with watching pure price action, while yet others trade better with a smattering of both. Opinions one way or the other don't change that one iota so don't ever accept other trader's "opinions" to the contrary. Opinions are pretty much like derrieres (your posterior heh, heh) and pretty much everybody has one.

 

Some traders may think they have "graduated" beyond the need for indicators and that is fine as there is plenty of room in the markets for all types. There is no such thing as a pure best method of trading no matter how much some may wish to protest to the contrary. [...]

 

Yes, I agree

 

Some trade with indicators and win

Some trade without indicators and win

Some trade with indicators and lose

Some trade without indicators and lose

 

I don't see the problem at all.

 

I rather think that traders criticising indicators, can't make a good use of them - hey don't experiment with different settngs and have no patience in finding their true help.

I visited seminar yesterday that explained elliot wave and some another obscure oscillator giving 100% winning trades at all times.

 

(????)

[Tams 20]

...

 

I rather think that traders criticising indicators, can't make a good use of them - hey don't experiment with different settngs and have no patience in finding their true help.

I visited seminar yesterday that explained elliot wave and some another obscure oscillator giving 100% winning trades at all times.

 

(????)

 

if someone can give 100% winning trades at all times,

he won't be giving seminars.

and if you have learned anything from the seminar, you won't be a lonely forum rat.

[fxtrader12 10]

if someone can give 100% winning trades at all times,

he won't be giving seminars.

and if you have learned anything from the seminar, you won't be a lonely forum rat.

 

Won't be? Why not?

 

Is this forum accepting only 50% methods as true and any better than that as fake?

[Tams 20]

Won't be? Why not?

 

Is this forum accepting only 50% methods as true and any better than that as fake?

 

no

 

because we are learned, and you are not.