Are we out of the woods yet?

Looks like we will be testing that today!

I envy those who are bagging ADA today…#LuckyBastards

Didn’t hold. Unless a major catalyst happens (news breaks), This turn around is going to take at least another week. Until then!!!

does TA really work in this market?

TA works in No market. It is de facto impossible that simple TA could ever work, since this would be the first that would be programmed into algos, and the edge would immediately vanish.

The reason it “seems” to work is the fact that there is always a probabilistic 50-50 chance of any move in any direction. In a bull market, all buy indicators work, in a bear market all sell indicators work, and in a ranging market, none of them work.

In clear cases of obvious edge, there are usually other things preventing you from taking advantage of it, aka. short interest fees, etc.

If you are looking for edge, you have to look places no one is looking.

and Yes this market works the exact same as any other market.

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That’s what I have been told all my life, but never actually tested TA. There are momentum indicators (beyond SMA crap) that can help squeeze extra juice in trending markets, but they can’t predict reversals… with the way crypto moves–you’d find yourself rekt before you know it.

But these indicators provide you no edge, it is either neutral or negative risk/reward, so you will always stay neutral (but then lose to fees and spread) or lose from trading in the long run.

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If you use them as the only tool in your arsenal, then yes, but combined with fundamentals they tend to generate alpha… at least in equity markets.

Nope. That is why no professional fund managers beat the market and those who do, are just in luck (statistical measurable). It takes so much more than this, those who are beating the market you will never hear about and they will not be using any indicators you have ever heard of… And most them will be a piece of code and not a human.

The number of public fund managers that have beat the market over 30 year period, is prob less than 20… There are a few known stories out there…

Are you saying that momentum doesn’t even enter the equation? Curious to know what indicators they might use.

I am saying that even if momentum indicators gives you more upside, if you did it 1000 times you will have neutral risk/reward (but lose to fees and spread), sure it might put you in favor of 90% to make 1% but the last 10% of the times you will then lose 10% so it comes out as neutral in the end. Even though it will “looks” like it works, because it will 90% of the times. (stats was just for play)

You can just get a back-testing program and backtest all of these things, it is very easy to do.

Also remember, even with a neutral risk reward strategy or a monkey throwing random darts with no fees and spread, you will have 50% chance to double your money, and 25% chance to 4x in most cases (not all) and this is what tricks most people because they “connect” it with whatever they did.

and as we speak there are hundreds of millions of calculations being done by AI every second, to find any edge that can be sucked out.

Many professional studies have been made that calculate the markets to be 50-50, and have come to a conclusion that the markets are random (except for upward drift and general return), but the markets are not random, it is just because they cant find any edge with what they are working with.

I understand what you are trying to say. What you just described is pure TA.

I don’t care if it doesn’t work. To me TA represents man’s desire to find order in chaos with the help of triangles. Keep fighting the good fight I say.

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Yes. TA does work in the crypto market. People who say TA doesn’t work, don’t understand how the markets move (@jb455) Yes, TA is very probabilistic BECAUSE THE MARKETS ARE ALWAYS CHANGING. Even the most successful traders, trade at 90% all the time… I’m running out of time, but hopefully I will try to continue tomorrow, because I will explain a little more.

TA is very interesting. If you can, read the history of TA. It’s very interesting with which TA dates back to the 17th century. TA has stood the test of time, because if it didn’t, why are people still using it today?

To understand TA, first you need to understand the basic fundamentals of the market. Why do markets move the way that they do? I suggest reading up on the Elliot Wave Theory and the Dow theory. THE BIGGEST basic principle I use is market elasticity, meaning that markets act as a rubber band. It can only be stretched so far one way before it retracts back.

In the market, there is what we call bulls vs bears. I think this is over played, and I consider the market oscillating naturally. Why do markets oscillate? Why does the price action never travel in a straight line?

One thing that these TA “gurus” don’t take into consideration as why market moves the way they do, fundamental analysis. Fundamental analysis will always override TA in the long term. Fundamental analysis would be considered news, financial conditions, valuations, etc. But at what point does FA overtake TA? TA needs constant reanalysis because the conditions of markets are always changing. This is why we have these so called “predictions” that always fail (and most people don’t know what to look for).

TA consists of indicators. Indicators are able to quantify markets conditions based on historical data. Historical data is used to predict short term market conditions. With market conditions constantly changing, this leads to probabilistic odds. Like I said before, professionals are not able to trade 100%, but can trade anywhere from 51% to 95% depending on your strategy. With that being said, TA is not impossible to make a profit. For those who say, you cannot beat the markets, its because you don’t understand the markets. If you think you understand the markets, you should be able to answer every question above with 100% certainty.

I have studied financial markets professionally and at least on the paper and according to extensive studies, TA doesn’t have a lot of predictive power.

TA forced you to accept that price and volume alone are enough to explain future performance, which I find hard to accept.

The probabilistic qualification all these predictions come with, allows to have an out for anyone making these calls.

Case in point : some guy called BTC would drop below 5.8k before coming back up on Bloomberg, but then again said if we see a price movement above 6.3k the upward trend would hold. He put the upper price movement at 10%, which means if you followed his advice you’d lose money on your shorts.

But since he qualified his statement with 10% chance of being wrong, he can say: hey I said i could be wrong…

Anyway I kind of look at TA as weather forecast, could be useful in the short term but price patterns don’t really explain a much.

Was this the same paper the economics professor failed at TA, and mathematically disproved TA? If so, mathematical models don’t necessarily apply to markets due to the fact of constant changing of market conditions. If you are applying mathematical models, they ALWAYS need updating/tweaking.
EDIT: Unless they developed AI that can learn from the past and make corrections accordingly.

100% correct. Price and volume alone are not enough to explain future performance. TA only explains short term performance (Intraday).

I saw this article. Why would a trader tell you this? Wouldn’t you be cutting into his profits? And never take advice from someone else. Always DYOR!

I don’t look at patterns in price, but some people find them helpful.

Bull run starting?

Not a bull run. Just the Coinbase tweet

When there is a bull run everything on Coincheckup will be green, not just the 5 coins of the Coinbase tweet :slight_smile:

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Interesting! Right at the forefront!

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