Price Action EA or indi

I’m not an experienced trader by all means, but I noticed there are 2 opposing trading groups: the purists (=no indicators/EA’s, just pure price action) vs people that use a large array of indicators, more or less lagging.

My question is: why not taking the best from both worlds and create an indi/EA that will use pure price action? For instance, monitor candle formation and once a classic pattern emerges (pennant, ABCD, triangle, etc) to alert or even trade accordingly.

I find it silly nowadays to still be glued to the screen and monitor charts which can be a boring, eye straining way to trade when we have all these new technologies.

Eddie

Good luck with them, Eddie.

Do you know anyone who actually makes a living from “all those new technologies” without sitting in front of the screen?

I was mainly referring to those traders that have 3-4 monitors in front of their eyes and they stare at the charts for hours - why do we still trade like in the 80s?

I’m not sure, but might it be partly because the few who have been doing that for decades are the survivors, who are successfully making a living from trading forex, while there’s also been a continual, huge turnover of countless generations of others trying more “modern” (including automated) methods, of whom [I]none[/I] or almost none ever achieves that?

I don’t stare at 3-4 monitors, myself, because I’ve found I can only really look at one at a time, but I do have 3-4 different chart/trading windows open on it, and flick between them (which is perhaps effectively similar to what you describe but just more “laptop-friendly”, etc.?).

I was just wondering whether you know anyone who makes a good, steady living by trading forex using an “EA”, Eddie? I don’t, and I never have done, and I don’t expect to either, but I do know several people who do so very successfully by using the approach you seem to consider so old-fashioned.

It struck me, reading your original post above, that this is perhaps one of the many issues in forex-trading about which there are two radically different consensuses of opinion: one among the enormous and ever-changing group of “aspiring forex traders” and another, perhaps almost opposite one, among the tiny and constant group of “forex traders actually making a living”?

Hi Eddie, I don’t really think there are any [I]opposing [/I]groups here, although it may seem so when reading various threads. Basically,when traders analyse their positions from charts they are performing the same process but in their own preferred manner - afterall, even chart patterns are based on price movements, as are various tech analysis tools. Perhaps the term “technical” analysis is a bit misleading. I think the two [I]real [/I]different approaches are either (1) views based on personal fundamental analysis and (2) views based on the net result of everyone [I]else’s [/I]actual participation in the market.

The type (1) trader trades from studies of economic releases, reports, statistics, etc and doesn’t actually need to look at a chart at all - and tends, almost by definition, to be a longer term position trader. The type (2) trader studies the charts, but one shouldn’t think of indicators as a bunch of cleverly designed magic formulas that somehow predict where the market is going. TA is based on two main premises: Firstly, that the only relevant “information” is not what people [I]think [/I]about the market but what they are actually [I]doing [/I]in the market. And secondly, that all you need to know is what the [I]majority [/I]is doing and then follow them. All any set of indicators is trying to do is analyse what the majority is doing, for how long, and how far. In my opinion, when you study a chart, whether you use indicators of not, you are seeking significant evidence of what the majority of [I]other [/I]active participants is doing.

Depends on the person :slight_smile: I actually [I]like [/I]watching and playing with charts on a screen. I probably spend as many hours on screen outside my trading hours as during :slight_smile: I could argue why bother going to watch football matches when you can get the full results summary in the evening.

My satisfaction is in profiting from my own input to my trading. I like it that way, I like watching price action unfolding in front of me on the screen, Why do air traffic controllers stare at their screens? Why do process engineers monitor their screens? Why do TV cameramen stare through their lenses? 'Cos it goes with the job and they like it :smiley:

As for new technologies… wow, online price data feeds, split-second fills on market orders from anywhere in the world, trading platform analysis tools - ain’t that already great, modern technology? :smiley:

Hi just to add on from my point of view:

EA are robot which execute your ideal outcome, but word of caution, there is no 100% accurate prediction in forex. So my suggestion is dun expect EA to do everything for you. Some of the tasks still need the trader himself to complete before handing over to the EA.

Pardon for my poor English :slight_smile:

For me , I personally prefer to trade with my own judgement :slight_smile:

Love you guys :wink:

Many traders (myself included) enjoy the feeling of sitting in front of the charts looking for an opportunity, or solving puzzles as you will. But, as time has gone on (for me anyway) I have moved away from spending hours and hours in front of the charts and gotten on with my life, and my trading has gotten much better as a result! I can only attribute it to trading off the daily and taking less trades, but better ones. After all, it’s not how often you trade, but how successfully you do it that determines your progress. Just recently I found a candlestick indicator that finds particular candlesticks or patterns and notifies me on my phone, and now I can spend even less time searching for the perfect trades. But to each their own…there’s no one right answer for everyone.