Experiments in Technical Analysis
- Thread starter karthikmarar
- Start date
Re: Amarnath vs others - Experiments in Technical Analysis
Waiting for the next episode!!!
Dear friends,
Now here is the next part. It is a flashback story.
The first post in the thread "Experiments in Technical Analysis" was on July 22, 2006 by Karthik. It was not about MACD. Initially he posted some techniques based on Moving Averages (EMA). After 100 posts in the thread by different people, Mr. Amarnath entered and there were some questions, discussions and suggestions. At that time his tone and language were acceptable. He did not question the utility of moving averages and cross-overs but suggested inclusion of MM into the system which was a very valid point. He also suggested sticking to one system instead of trying out many. Karthik had replied to both the suggestions. In message No. 108 Amarnath has clearly mentioned that he is not against experimenting and developing trading systems. He even suggested developing the system in a professional manner. A very good suggestion indeed. Karthik replied to that explaining it is more easy to say than to do. Probably Amarnath was not satisfied and finally he quit saying that he would not take part further in the thread till there was some useful outcome. He kept his word till recently. But at that time the tone was harsh but I would say still tolerable.
When the thread went past 300 posts I too started contributing whatever little I could. That was in Nov 2006. Even at that time the thread was about Moving averages and cross-overs. It was only when there were more than 560 posts that Karthik took up MACD entirely as a trading system. So, any kid can calculate whether there are 1000 post about MACD.
Meanwhile the 'System Implementation Exercise' started (around Jan 2007). Unfortunately, the exercise was not completed due to various reasons. Whatever results were available were useful in understanding the problems in system development. These should have been posted on the forum but it was not done as the people involved were not available due to various reasons, somebody was having a busy work schedule, some one was not well, I had to go out to a different place etc. If all the people are able to come together again we can still do it.
What I want to point out by going back in time is that the thread was never meant to discuss or propagate or glorify MACD. It was a platform for testing and discussing different strategies, trying to refine well-known methods, try out combination of more than one method into a single system in the hope of getting synergistic effect etc. It was not meant to invent or discover a Holy Grail System. My perception of Holy Grail is, a system which not only tells you what to do exactly at what time but also tells you what happens next. And no system can tell you what will be the price of a stock tomorrow. If such a system is formulated then there will be no market, no trading and no traders and investors. Because if you know tomorrow's price no buyer will buy and no seller will sell today. And tomorrow the same thing happens because tomorrow is today for day-after-tomorrow.
This does not mean there is no point in experimenting or innovating. It is only through experimenting we learn and improve even if the experiment fails. In fact we learn more and inprove more from failures than from successes. So, even if the "Experiments in Technical Analysis" did not produce a trading system we can not say that the 1000 plus posts (now more than 1200) are wastage of Band width and time and energy. We should learn from the failures and continue experimenting. So there is no question of closing this thread just because somebody did not like the experiment.
After the flash back we come back to the story again.
TO BE CONTINUED ...
Regards
-Anant
Waiting for the next episode!!!
Now here is the next part. It is a flashback story.
The first post in the thread "Experiments in Technical Analysis" was on July 22, 2006 by Karthik. It was not about MACD. Initially he posted some techniques based on Moving Averages (EMA). After 100 posts in the thread by different people, Mr. Amarnath entered and there were some questions, discussions and suggestions. At that time his tone and language were acceptable. He did not question the utility of moving averages and cross-overs but suggested inclusion of MM into the system which was a very valid point. He also suggested sticking to one system instead of trying out many. Karthik had replied to both the suggestions. In message No. 108 Amarnath has clearly mentioned that he is not against experimenting and developing trading systems. He even suggested developing the system in a professional manner. A very good suggestion indeed. Karthik replied to that explaining it is more easy to say than to do. Probably Amarnath was not satisfied and finally he quit saying that he would not take part further in the thread till there was some useful outcome. He kept his word till recently. But at that time the tone was harsh but I would say still tolerable.
When the thread went past 300 posts I too started contributing whatever little I could. That was in Nov 2006. Even at that time the thread was about Moving averages and cross-overs. It was only when there were more than 560 posts that Karthik took up MACD entirely as a trading system. So, any kid can calculate whether there are 1000 post about MACD.
Meanwhile the 'System Implementation Exercise' started (around Jan 2007). Unfortunately, the exercise was not completed due to various reasons. Whatever results were available were useful in understanding the problems in system development. These should have been posted on the forum but it was not done as the people involved were not available due to various reasons, somebody was having a busy work schedule, some one was not well, I had to go out to a different place etc. If all the people are able to come together again we can still do it.
What I want to point out by going back in time is that the thread was never meant to discuss or propagate or glorify MACD. It was a platform for testing and discussing different strategies, trying to refine well-known methods, try out combination of more than one method into a single system in the hope of getting synergistic effect etc. It was not meant to invent or discover a Holy Grail System. My perception of Holy Grail is, a system which not only tells you what to do exactly at what time but also tells you what happens next. And no system can tell you what will be the price of a stock tomorrow. If such a system is formulated then there will be no market, no trading and no traders and investors. Because if you know tomorrow's price no buyer will buy and no seller will sell today. And tomorrow the same thing happens because tomorrow is today for day-after-tomorrow.
This does not mean there is no point in experimenting or innovating. It is only through experimenting we learn and improve even if the experiment fails. In fact we learn more and inprove more from failures than from successes. So, even if the "Experiments in Technical Analysis" did not produce a trading system we can not say that the 1000 plus posts (now more than 1200) are wastage of Band width and time and energy. We should learn from the failures and continue experimenting. So there is no question of closing this thread just because somebody did not like the experiment.
After the flash back we come back to the story again.
TO BE CONTINUED ...
Regards
-Anant
U
What.... jose silva himself talking about MACD ......oh..must have lost all his shirts ......
Mkt is an unknown entity,how can i say this does not work or that is useless becoz everybody's personal episode with the Mkt is dependent on his/her TF ,Risk defination etc.
Something which does not work for me may be giving better result to others,only fools & dumb like me make a final verdict whose quest is over.
Hi Friends
Now that some seeds of doubt have been sown with regards to the very purpose of this thread, I feel there is a need to put the objective of the thread in much clearer terms..
I am quoting my first post of this thread below. I was very clear from the beginning that I will be posting various experiments and studies I made during the course of my TA journey. I also encouraged others to share their experiments ideas etc.
At no point in this thread there was any effort to show something as the Holy Grail stuff or something is the best or better than any other.
We all know that the TA is a minor part of the whole trading game. The idea was to expose the newbie to different aspects of TA. We all go through a phase of experimentation in our pursuit of TA though most of us may not really realize it and term it as experimentation. But it is an essential part of learning purpose otherwise learning is bookish, slow and incomplete. If one does not experiment with an indicator how he or she is going to realize whether it is suited for his or her trading style. Experimentation provides far wider insight into the various aspects of the indicator and its behavior.
Also I fail to understand the hue and cry trashing the MACD. What is wrong with MACD when the man who made all the noise posted earlier like this..
Also the posts about MACD is far less than the posts on one of the system posted by me MABIUTS…
If Digital Filters are the answers to everything then John Ehlers should have to been the most successful trader today…
Also this thread never tried to exploit this forum for any gains like the "someone" who used this forum to Beta test his software which he claimed will be better and cheaper than the popular Metatrader.
In this thread, there is nothing wrong and there is nothing right. It is a discussion and in such a discussion we discuss the pros and cons without any acrimony. The minute acrimony enters a discussion it ceases to be one. So I hope this discussion will continue to be one… a discussion to share thoughts, views and ideas…
Warm regards
karthik
Now that some seeds of doubt have been sown with regards to the very purpose of this thread, I feel there is a need to put the objective of the thread in much clearer terms..
I am quoting my first post of this thread below. I was very clear from the beginning that I will be posting various experiments and studies I made during the course of my TA journey. I also encouraged others to share their experiments ideas etc.
At no point in this thread there was any effort to show something as the Holy Grail stuff or something is the best or better than any other.
We all know that the TA is a minor part of the whole trading game. The idea was to expose the newbie to different aspects of TA. We all go through a phase of experimentation in our pursuit of TA though most of us may not really realize it and term it as experimentation. But it is an essential part of learning purpose otherwise learning is bookish, slow and incomplete. If one does not experiment with an indicator how he or she is going to realize whether it is suited for his or her trading style. Experimentation provides far wider insight into the various aspects of the indicator and its behavior.
Also I fail to understand the hue and cry trashing the MACD. What is wrong with MACD when the man who made all the noise posted earlier like this..
Also the posts about MACD is far less than the posts on one of the system posted by me MABIUTS…
If Digital Filters are the answers to everything then John Ehlers should have to been the most successful trader today…
Also this thread never tried to exploit this forum for any gains like the "someone" who used this forum to Beta test his software which he claimed will be better and cheaper than the popular Metatrader.
In this thread, there is nothing wrong and there is nothing right. It is a discussion and in such a discussion we discuss the pros and cons without any acrimony. The minute acrimony enters a discussion it ceases to be one. So I hope this discussion will continue to be one… a discussion to share thoughts, views and ideas…
Warm regards
karthik
Hi Friends
Now that some seeds of doubt have been sown with regards to the very purpose of this thread, I feel there is a need to put the objective of the thread in much clearer terms..
I am quoting my first post of this thread below. I was very clear from the beginning that I will be posting various experiments and studies I made during the course of my TA journey. I also encouraged others to share their experiments ideas etc.
At no point in this thread there was any effort to show something as the Holy Grail stuff or something is the best or better than any other.
... ... ...
... ... ...
Also the posts about MACD is far less than the posts on one of the system posted by me MABIUTS
... ... ...
Also this thread never tried to exploit this forum for any gains like the "someone" who used this forum to Beta test his software which he claimed will be better and cheaper than the popular Metatrader.
In this thread, there is nothing wrong and there is nothing right. It is a discussion and in such a discussion we discuss the pros and cons without any acrimony. The minute acrimony enters a discussion it ceases to be one. So I hope this discussion will continue to be one a discussion to share thoughts, views and ideas
Warm regards
karthik
Now that some seeds of doubt have been sown with regards to the very purpose of this thread, I feel there is a need to put the objective of the thread in much clearer terms..
I am quoting my first post of this thread below. I was very clear from the beginning that I will be posting various experiments and studies I made during the course of my TA journey. I also encouraged others to share their experiments ideas etc.
At no point in this thread there was any effort to show something as the Holy Grail stuff or something is the best or better than any other.
... ... ...
... ... ...
Also the posts about MACD is far less than the posts on one of the system posted by me MABIUTS
... ... ...
Also this thread never tried to exploit this forum for any gains like the "someone" who used this forum to Beta test his software which he claimed will be better and cheaper than the popular Metatrader.
In this thread, there is nothing wrong and there is nothing right. It is a discussion and in such a discussion we discuss the pros and cons without any acrimony. The minute acrimony enters a discussion it ceases to be one. So I hope this discussion will continue to be one a discussion to share thoughts, views and ideas
Warm regards
karthik
You are absolutely right. That is exactly the reason why I went into flash back mode and brought out the historical events and facts.
The Moving Averages, Cross-overs, MACD, RSI etc. and their limitations are well known for a long time. Then why there is interest in these even today? Within their limitations these systems still work and are very simple to understand and implement. When a trader applies these techniques there is always an element of his/her own interpretation and observation going into it. That element comes from experimentation. If these techniques (with their own limitation) gave the same results then everybody should have bought or sold at the same price. But it does not happen. Even after following the signals the exact execution is individual's choice depending on the interpretation and the same holds for any system whether you use a digital filter or a coffee filter to trade.
If somebody wants to point out the drawbacks then it should be through a decent discussion and useful contributions to thread. It does not lead the people anywhere by just calling the people as brainless idiots re-inventing the wheel. If we go deeper into the subject we may even find out that digital filters are also some kind of re-invented wheel. Quoting electronic or digital filters, quantum mechanics etc. does not make the person very learned and knowledgeable.
I will on my part continue the "Experiments in Technical Analysis" and post in this thread. It does not matter to me if somebody thinks that I have vaccum in the top floor. I also request you to keep the thread alive and not to bother about the unholy sounds being made.
Regards
-Anant
U
In Quantum Physics the 'force carrier' like 'bosons' not yet observed in a 'Standard Module'
is :- 'Higgs boson' (yet known as Gods's Paticle right in Dec 29 th 2007) but this explians the
origin of Mass,also the:- 'Graviton' is yet to be quantified.
So it boils down that my limitation of knowledge does not nessacarily mean it does not work.
Who can deny Gravity does not work but we are still unable to quantify 'Graviton'
is :- 'Higgs boson' (yet known as Gods's Paticle right in Dec 29 th 2007) but this explians the
origin of Mass,also the:- 'Graviton' is yet to be quantified.
So it boils down that my limitation of knowledge does not nessacarily mean it does not work.
Who can deny Gravity does not work but we are still unable to quantify 'Graviton'
There are many more things we have not understood and quantified. What we know or believe we know is a small part of what is to yet to be discovered, understood and quantified.
In the next part in the case of 'Amarnath vs others' I will discuss the quantum mechanics which Amarnath has quoted. But that will be after a fortnight. The hearing is adjorned for a fortnight as I am on vacation.
Till then I wish all the members:
A VERY HAPPY, PROSPEROUS AND PROFITABLE NEW YEAR.
I also wish all will have a peaceful time despite the presence of noise makers.
Regards
-Anant
In the next part in the case of 'Amarnath vs others' I will discuss the quantum mechanics which Amarnath has quoted. But that will be after a fortnight. The hearing is adjorned for a fortnight as I am on vacation.
Till then I wish all the members:
A VERY HAPPY, PROSPEROUS AND PROFITABLE NEW YEAR.
I also wish all will have a peaceful time despite the presence of noise makers.
Regards
-Anant
What.... jose silva himself talking about MACD ......oh..must have lost all his shirts ......
Jokes apart, the backtest model used seems a good one (at least for me, don't know about the more fervent backtest-junkies).
The post by TonyM here is also worth a read
http://tradersconsortium.com/community/index.php?showtopic=1445&pid=7194&st=20&#entry7194
Thanks Asishda for the subtle pointer.
There's more i want to write on this, but as of now ... late for lunch.
Regards,
Kalyan.
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