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Conflicting information

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tpredictor View Post
Initially, you should anticipate some decreased performance with any new method but with more experience the results could be different.

New methods aside, the existing method a trader uses needs to be continuously pruned and maintained to be as streamlined as possible. One problem is feature creep (borrowing from programmer lexicon) and another is overfitting your model. One thing Ive learnt is that I was always trying to find a reason for what I was seeing on the charts and looking for reasons to get into a trade. Having too much information exacerbates this problem.

tpredictor View Post

Conflict is generally useful when it can be used to make inferences about future market behavior and involves active cognition. Conflict is generally less useful when a singular idea is given excessive weight and becomes static. Information will have different relevance at different time frames and times. As to the answer, if you plan to use the data in a systematic way then you will desire the most predictive information, and you should remove any data that does not contribute an edge. However, information that comes out in irregular, unplanned, or hard to systematize forms may be useful for creating new more complex speculations regarding future market behavior.

As an example of one might combine conflicting information, let us imagine that you are bearish on the market but you have a system that triggers a long on a shorter time frame. Synthesis is the creation of something new from the existing. A superior synthesis could be to take the systematic long trade but to reverse short when it exits the trade. In this way, you are able to make use of all the information.

I completely agree. This is exactly how I use conflicting information. My conflict is different timeframes telling me different stories and I am learning to roll with it. One timeframe might be trending but you can see when exhaustion sets in, then you jump on another timeframe and try to make the most of the pullback or rally and then get out at the earliest signs of a change of behaviour and look for reasons to get back into the bigger trend. Also, what is ranging on a higher timeframe can be amazing trend opportunities on another.

What Im trying to say is that you will always have conflict. Your job is to remove as much as possible and learn to work with what is unavoidable.

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