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Anyone find any indicators of value? That you wouldn't trade without...?
I used to be mostly at some other forum where consensus seemed to be that indicators don't offer any value and were even of negative value (clutter up your charts, lagging, etc.) and that pure price action as the purists call it is king.
I get the feeling that people on this board use indicators far more and that there's a lot of custom indicators being made and used, particularly in Ninjatrader.
I've been focused on some other part of my trading methodology for some time, but as I'm now focusing more on my charting methodology, I'm interested in exploring the use of indicators that can help or improve execution. One obvious advantage of indicators is that they can offer objectivity and clear signals whereas 'reading price action' might be a bit more subjective.
Currently, I use two indicators myself which I find have great value in actually organizing my charts:
1. Price Action Swing - I simply use the basic feature which plots swing points. For me, this is a way to measure the market and better see what's happened.
2. OHLC indicator. I like to pay attention to prior day OHLC and find that this indicator does that automatically.
So, for me, these two indicators provide a lot of value for sure as they automate things and help me better see what's going on.
Beyond this, I'd be interested in seeing if I might find something that could help execution. Perhaps a momentum indicator of some sort. Stochastics/MACD or similar.
Would be interested in hearing how and what other indicators you people use. If there's any stuff you feel you couldn't do without. Maybe you even have a proprietary indicator you're not interested in sharing. That's interesting too.
Not exactly an indicator.... but I have a custom code built to identify my place in the queue. It's taken me a dozen or so builds to get it fairly accurate, but knowing if I am in the top 50% of the queue, the bottom 90%, the top 10%, etc... Makes all the difference in the world to me. I would never take a trade for example when I knew I was in the back of the line.
If you are in the back 90% of the line for example, then the only fills you will ever get will be toxic fills. But getting further up in line you can capture more non toxic fills.
There are lots of platforms that offer something like this, but they are typically either extremely conservative or extremely liberal and are usually significantly off.
Just throwing it out there....
Ian
In the analytical world there is no such thing as art, there is only the science you know and the science you don't know. Characterizing the science you don't know as "art" is a fools game.
I think you want to be clear are what you are trying to do then spend quite a lot of time trying different combinations of parameters to produce the effect you want.
Trading is such a complex art, in my opinion that one cannot be too rigid. (By that I meant only price action, only chart formations, only indicators) - you need to be open to what works for you.
For example I have three workspaces open during the day:
one has 3 charts
one has 5
one has about 20.
most of the time I'm on the 3 chart workspace.
Occasionally I review all the charts in the 20 chart workspace (which has many time frames).
Sometimes i turn to a chart, perhaps one I don't use often and "just see" something.
It could be price action usually doesn't "hit" that chart but on that day at that time it is just right
(perhaps it has an SMA 260 that usually isn't of interest but just then it is clear that that will be resistance).
For my trading, I try to get the context first on what’s going on, then using those indicators to help with entries, but it’s still work in progress . I think any indicator you choose probably will work if you spend enough time with it.
I used to greatly believe in volume and it seems to be one of the things that's widely accepted as important, but it's rarely questioned it seems. Personally, I don't use volume at the bottom of my charts at the moment.
But I am experimenting with volume bar charts and find them interesting.
I'm a bit curious about Delta indicators and bid/ask volume, but for my chosen market (ES) which is very thick and traded widely (SPY, ES, options, single stocks making up the index, arbitrage, etc.), I'm skeptical towards what I can actually read from it?
Delta and even pure volume analysis would make a lot more sense to me if applied to say a single stock or commodity. Just not convinced it makes sense for an index future.
If price is a car, volume is the gas in the tank. It is wholly applicable to any market. I've never messed with delta, looked at bid/ask but never really found much value in it... but that's not to say they don't have merit I'm not preaching it, everyone has to find their own way, but in the same breath it is the one factor that has turned my personal trading around.
Thanks for the link. I never heard of this guy. Is he known in the trading industry?
Could you elaborate a little bit on your statements about volume?
In my experience, price movement (assuming that's what we're looking for) can happen on large volume and very little volume. Also, you can have huge volume without much movement at all.
It's the skew between buyers and sellers that create price movement. Price goes up in the absence of sellers and vice versa. It doesn't matter if it's 10 buyers or 100 or 1000 as long as there's an absence of liquidity (sellers) at the market.
Price can exist without volume (a price quoted, but not traded), but volume can't exist without price.
There is thread by @t123knight called Wyckoff Speculator, where he uses 3-10 oscillator to determine momentum. He uses this in conjunction with PA and Wyckoff principles and not by it self. He did an excellent Webinar and talks about it in there as well. Working talking a look.
. I think any indicator you choose probably will work if you spend enough time with it.
