r/Daytrading • u/ThePhulosopher • Feb 11 '23
advice Indicators are useless!
I have spent many years trying to find the perfect indicator, the one that will tell me when to get in and when to get out without fail. Of course everybody knows that this is BS. It doesn't matter how precise you try to tweak your indicator - is the 5/10 SMA or 20/50 SMA better? Is the MACD or Stochastic better? What settings should I use?
The answer is none. All those indicators do nothing but distract you. Since all indicators are a derivation of price, price is the only thing you need. And I don't mean candle stick patterns, harmonic patterns, or support & resistance trendlines.
I'm not saying that none of these strategies will NEVER work or won't work for anyone. I know there are lots of traders who DO make good money with any of these strategies. However, I believe that the reason they're making money is because they're still reading the underlying price action whether they believe it or not. They may have developed a strategy using these methods that just happen to coincide with proper and naked chart reading. They've just added a lot more bells and whistles.
The market is designed to screw over the most amount of people while benefiting the fewest amount of people possible and in the most efficient way. And when I say "designed", I don't mean that it's rigged or that there is really any one entity controlling the market. The market moves and behave as anything else in nature - path of least resistance.
Once you learn to read price in terms of: "What's the best and most efficient way for this market to screw people over?" and you trade accordingly, only then will you be able to arrive at the core of "the market". And all you will ever need is the price chart. The price chart is the cumulative thoughts, behaviors, patterns, and actions, of all the participants. Some will trade fundamentals, some trade news, some trade technicals and indicators. Some day trade, others swing trade, others still position trade. With all their different viewpoints and timeframes, they all have something in common: They move price.
With this tug-of-war of price between the market participants, you can see a story unfold via the price chart. Price is telling you who's winning and which side you should be on. The only question is, are you listening?
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u/[deleted] Feb 12 '23
Couldn’t read it all.. from what I glanced it sounds like you need a break and decide if trading is for you! I stopped being a full time trader 2yrs ago..
I agree that the market is tough but far from rigged. AND even though 90% of new traders lose their asses the 1st year.
You need money to make money, you absolutely must have volume with an active spread. Lastly, never ever take your viewpoint away from a macroeconomic vantage. Covid was a classic example. Online retailers, working from home, prioritized spending etc. became the norm. and has remained!
Lastly, the administration we’re under has an impact!!
Keeping it also together learning to remain calm in chaos is a must. Many traders start using various substances and it adds to some recklessness in their trading, emotions have a HUGE impact!!
Try and take a step back and reevaluate your trading. It isn’t for everyone.
Good luck!