Rhody…
I’ve been reading about this concept of Buying Low and Selling High.
I’ve Backtested this and to me, this seems like the Holy Grail. Maybe I’m wrong, but seems like I would always make money waiting to buy at the lowest point of the day, and then just hold until it reaches the highest.
If you or anyone could reply a message to this thread and let me know which indicator or system would do this for me.
Oh yeah thanks in advance!!!
;o)
Kangi
Hi,
I would always make money waiting to buy at the lowest point of the day, and then just hold until it reaches the highest.
There’s the problem right there!!!
How do you know when the price has reached it’s lowest point of the day and how do you know when the price has reached it’s highest point of the day? If ANYONE knew the answer to both of those questions they’d ‘have it made’ I can assure you.
The point is: when you’re looking at historical data on a chart it’s easy to see where the lowest point of the day WAS and where the highest point of the day WAS but the problem is that ON THE DAY you have no way of being sure that you are buying at the lowest point of the day and selling at the highest point of the day because the price is moving and you don’t know at the time just how far or in what direction it’s going to move.
The ‘closest’ you’re going to come to trading using this ‘methodology’ is by using ‘pivot points’ or understanding (very well I might add) support and resistance levels i.e. there is no indicator that can ‘accurately’ alert you that either the lowest point or the highest point of the day has been reached.
OMG I never thought of that!!!
Naaasssty!!! (Going for 2000 now)!!!
Darn it!!! and I was soooo hoping! Looks like it’s back to that McDonalds managerial position…
(couldn’t resist)
I have to ask…
Was this post a joke? Are you attempting to wind me up in some fashion or bust my chops? I mean observing that being able to buy at the day’s lows and sell at the day’s highs would make you an incredibly successful trader is about the biggest “Duh!!!” of all. Just think about it for a minute.
Here’s the irony, though.
I do know a methodology which is well suited for picking out tops and bottoms. It’s something I use every day in my day job (stock market focus), but which is not market dependent. Of course it’s not perfect, but it can really be amazing how accurately it picks out key turning points for a given timeframe. I recently ran a course on the subject (proceeds to support a good cause). PM me if you’d like to learn more.
Now now folks!!! Give the guy a break (although after 112 posts I would have imagined he’d at least ‘worked this one out’)!!!
On the other hand: it’s easy to make a mistake like that (believe it or not). In other words: it’s easy to look at a chart and see where you WOULD HAVE got in and WOULD HAVE got out at a profit and forget that when you’re ACTUALLY TRADING i.e. IN THE PRESENT you do not have that information YET. Believe me. I once tried to use the ‘ZigZag’ indicator ‘thinking’ that ‘hey, this is easy, just buy on a ‘Zig’ and sell on a ‘Zag’, guaranteed profits right’!!! I’m sure I don’t have to tell you what happened!!! It demonstrates my point well though i.e. the ‘ZigZag’ indicator will only ‘Zig’ or ‘Zag’ AFTER the fact and what’s more it can keep on ‘Zigging’ or ‘Zagging’ in the same direction if the price retraces enough. The point is that if you ‘plonk’ the ‘ZigZag’ indicator on a chart it LOOKS like you could never have gone wrong!!! See my point??? (It apparantely has a lot of merit, however, if you’re using it confirm waves I believe).
Anyway, hey, John, you know me, I’m ALWAYS keen to learn something new (and I’m a ‘good cause’) so does you PM offer stand for me too???
Actually it was a joke, see the little smiley face at the bottom of the first post… come one guys… ;o)
Interesting some of the post to it though. hehe
I think every indicator ever devised has some roots, to “trying” to indentify bottom and tops. But if you find one that is working be sure to message me about it, so I can go in debt to my eyeballs and then leverage up to 500. I would be able to retire in what seven days, right?
Nah rhody not busting your chops, Knew you was pretty keen on different markets. Figured you would see the humor in the post but with newbies I suppose sometimes you can never tell… Yeah I trade different markets as well, been locked loaded and leveraged long with DRYS since 52.78. ASTI is showing some promise too in at 13.10… ;o)
So far it looks like it is pivot points, and support and resistance from the thread. hehe
Good thing I asked this question, appears Tony has been on the wrong track for awhile… haha
;o)
Kangi
Needless to say it is now I that is less than amused!!!
Dpat…
Your entitled to not be amuse if that is your take on it. I posted something I thought was funny, and still find humorous… Since it is the reason we all backtest stuff.
Who said the forums had to be uptight. There is humor all in the babypips school, Dr Pipslow’s blogs has humor in it. why get serious on the forums.
Yes I’ve used the zig zag method as well, it sucks. hehe
Kangi
Thankfully you and bpips have put me on the right track!
No Kidding…
;oP
I nominate this for best thread of the year! It should be stickied!
Good for you Kangi, to put in some humour, the posts here can sometimes be very dry indeed.
The stocks method I know for picking tops and bottoms uses the Bolinger bands, Money Flow Index (MFI) and volume. But it is fraught with danger.
It would be interesting to see what Rhodytrader comes up with.
Tymen…
Yeah I would like to see what the [I]"major underlining thing "[/I]most senior members are using to identify highs and lows or basing most of their system off of…
I know for me, sometimes I start off with a decent thought, then add this indicator to “tweak” it. after awhile it ends up being 20 tweaks and the major underlining indicator is no where in sight. lmao
You know a group effort in testing what is a good base indictor to start with, might be an interesting project. one thread to toss the ideas out and test them out, another thread posting just the results.
Hopefully we can figure it out in time, before jimbospeed has to go back to being a mcdonalds manager. ;o)
Kangi
What about not using any indicators at all?
Rhody…
Care to expand on that thought? I’ve heard about a few traders in my time that don’t trade with indicators heard a few of them did really well. I didn’t get the details to it so was left with the assumption that either they was just hedging or just trading for the carry and hoping to pick up some pips on the way at same time. This isn’t really trying to identify the tops and bottoms on a daily chart.
In real world I know it is possible as, Soros wasn’t using tech indicators he was using economic factors in his short of the pound
Kangi
Directional traders who don’t use indicators use chart patterns.
Keep in mind that indicators are, in most cases, doing nothing more than taking what you see on the chart and focusing on a certain element of it. Anything that an indicator tells you can be observed on the charts.
:eek:
Yes please do!!
I find that copious amounts of Burger Grease are ever so hard on my complexion…
and once your done please fill me in on the results as the boat is in need of a bottom job…