Does automated trading and technical analysis work?

Following on from the discussion at:

https://strategyquant.com/forum/topic/3255-portfolio-doing-well/

I thought I would create a new topic. 

I anyone wants to share views on this (does it work, here’s the proof) please do.  There’s no right or wrong answer, let’s keep it open minded and as scientific as we can.

Any links to myfxbook verified results appreciated, doesn’t have to be your own system, just something that proves real money is being made by traders over a number of years. My personal view is it can’t be done by using historical prices alone, you need an edge outside of just number crunching past data.  It needs to know the market sentiment now, and what’s happening in the near future.  Any ideas along these lines welcome.

If technical analysis alone worked, we’d be falling over forex millionaires down the pub. All I see is people getting rich selling courses and books and software.  If you ask where the rich forex retail traders are, they have all mysteriously gone silent on some exotic beach, never to reveal their success.

“Does automated trading and technical analysis work?”

If someone here seriously is questioning technical analysis (automated trading is technical analysis), then why are they 1) trading, 2) here?
 

“Does automated trading and technical analysis work?”

If someone here seriously is questioning technical analysis (automated trading is technical analysis), then why are they 1) trading, 2) here?
 

1. Because I believed in pure technical analysis, but for forex at least, I am having serious doubts (fundamental analysis + TA might be different).

2. Here because I am open to ideas and discussion about inputs beyond previous prices (e.g. the FA I mentioned above).

In addition there’s very little proof automated trading works.  Some people get very angry if you questions this. No sign of any ggod systems on MyFxBook that I can see.

Seems TA is a bit like religion in some respects. 😉

Sorry to hear you’ve given up.
Better luck to your next career choice.

Like I’ve said countless times on this forum, short term massive profit seekers will always end in misery.

Have some honor and walk away quietly, this thread is a disservice to the amazing work Marc is doing.

Have you bothered to read EVERY post he has ever posted or worked through every example he has provided or analysed and unpicked the models he has distributed? 

I have, but the vast majority of his posts are related to technical support as opposed to systems development. He has a couple of tutorials, but my buggest complaint with SQ is the lack of documentation.

Documentation for what? SQ & QA are very intuitive and with the *.PDF help files and sample build settings the operation of the software is very straightforward. Some of you guys/girls do not know how good you have it.

I hope you’re joking. There are a myriad of features that aren’t even covered in the “help file”. Even Marc acknowledges that the documentation is lacking, but nobody seems to be doing anything about it.

When I started this topic I was really trying to say this:

http://mechanicalforex.com/2016/02/ptolemaic-epicycles-and-market-modeling.html

Not any reflection on SQ or the development teams efforts.

But unfortunately, this forum is not open to new thinking in many cases.  So I’ve taken my discussion to another place with like minded traders and algorithmic developers.

All the best.

This is the sort of ideas I’m talking about, using Fundamental Analysis to give trades a directional bias.  Use TA and money-management techniques on lower timescales to place trades and gain the most pips.

https://www.youtube.com/watch?v=YyFNHQk1o10#

I’m also looking at guaging risk on / risk off in the global economy, it’s clear that the longer term bias on forex pairs follows this.

This is what macro funds use. This isn’t the type of stuff you get from auto generating strategies. You program this type of stuff.

Check out Quandl for historical macro data, load it up into excel and you can program end-of-day signals to manually enter into MT4 and use EA Wizard to program trailing stops and order management. That would yield the best results. A little secret on macro data trades: the biggest moves are when the market ignores it and goes the other way like what just happened with JPY NIRP reversal last 2 weeks (technical environment overrode the BOJ). Rig count falling causing crude to pop for 5-15 minutes are also notoriously the best data-moves to fade as well. This is hard stuff to automate and requires some real programming skills with a system and plan formulated. Its not as simple as pressing a generate button and walking away.

Check out Quandl for historical macro data, load it up into excel and you can program end-of-day signals to manually enter into MT4 and use EA Wizard to program trailing stops and order management. That would yield the best results. A little secret on macro data trades: the biggest moves are when the market ignores it and goes the other way like what just happened with JPY NIRP reversal last 2 weeks (technical environment overrode the BOJ). Rig count falling causing crude to pop for 5-15 minutes are also notoriously the best data-moves to fade as well. This is hard stuff to automate and requires some real programming skills with a system and plan formulated. Its not as simple as pressing a generate button and walking away.

I’ve been trading manually over the last month, using fundamentals, sentiment and FOMC/Non Farm as triggers and am profitable.  For example, USD was weakened by Yellen’s dovish stance and then a whole raft of good USD figures came out at NFP.  GBP had risen, but still had Breixt fears. 

Based on this, making money shorting GBPUSD was easy.  I also made good money on US30 going up.

I would urge anyone who is suspecting TA is misleading to watch all this video.

https://www.youtube.com/watch?v=EZdBzFcvwQY

and some other traders were profitable also with TA at the same time.

when you were sitting at your pc, they enjoyed their free time.

i love TA. i love SQ !!!  😀

Lol. Most funny thread here

https://www.youtube.com/watch?v=oU_OdfPnvKI

Interview with Simon Denham, Founder of London Capital Group.

😉

I manual trade as well and thats where my money is made (I’m fairly new to automation).

I pay no attention to the central banker talking potatoes or the economic numbers and how the HFT robots and IBM watson will react to the data. I read Zerohedge but only for entertainment, not for trading.

All I do is look at what time (intra-day entries) and what day (Daily based entries for multi-week swing positions) there will be releases, then I let the market price action decide on which direction I will take. I use no squawk box. I use no news feed. I just look at the price at the right time and what type of move it does. I don’t spam refresh on my calendar to see what the number was. I don’t even care what it was. The move in the market will tell me what the number was. Obviously if the fundamentals and technicals align like USDCAD longs Q2-Q4 2015 I will trade x2 as much risk to take advantage of it but really I pay so little attention to economic numbers coming out, only WHEN they are coming out.

You can find any professional trader to confirm your bias. I can find a professional trader that will tell you day trading doesn’t work. Another that says long-term trading doesnt work. Another that will say you cant pick tops and bottoms and another that says trend following is dead. They’re all right. They’re all wrong. They’re just confirming what works for them and what style they hate (doesn’t fit them). Don’t be one of them.

To go out and take a hard-lined position and put yourself in a corner saying “technical analysis doesn’t work” is taking an extremist position going against a massive field of data that proves otherwise. Your new signature proves your position otherwise. Its hypocritical.

“There is a million ways to make money in the markets and only a few will work for you and they’re all almost impossible to find.” Jack Schwager

I’ve already made a separate manual account (very small) 2 months ago I plan for the public after ~6months building it up to ~+10-15kUSD or so. It uses ONLY technical analysis. Here is a screen shot of it so far… I’ll announce when I make a public profile of it when I reach my goal and can reduce risk. Currently risk about 10-20% balance per trade to just ramp up the balance really fast.

File: asdf.png

File: asdf1.png

ONLY T.A.
Added it just for you.