I Don't Use Technical Trading Indicators

In this video, Stuart McPhee talks about why he doesn't use technical trading indicators in his trading. This is one favorite topic for Stuart when it comes about Technical Analysis. One of the common questions about trading is what are the best indicators to use. He thinks that people have a tendency to complicate things. At the beginning people say that trading is not easy so you think that you need a complicated solution for this to make it work. So you use one indicator to calculate what is the best solution. And then you get to the point when you think if this really is the indicator that gives the best solution?

Most people think that if some indicator work for someone, then for sure those indicators are good for them too. Stuart McPhee does not think that any indicators can provide to anybody useful information for a better trading. He is convinced about that. There are people who believe that there are indicators that can provide something because they have a method and an indicator that works for them, but Stuart's personal opinion is that for him after many searches there are no indicators that can work. There are no indicators that can provide any advantages.

If you think for a moment what is an indicator doing, well he is taking some pieces of data and it is running some sort of calculation based on that information. Years ago, when we did not have all those indicators we did not have the capacity to calculate them, people were still doing money from trading. So it is obviously that this is not a critical component and an essential ingredient for trading. Indicators are making things more complicated that they are. Also, with indicators a suggestion would be not to try overload lots of indicators into your system because they can end up conflicting one against each other. Often, if you have a particular feeling about a stock and you think the stock is going to do something you can find an indicator to justify whatever it is that you are looking to prove. So do not look to use many indicators because you sure can find just one that can prove that you were right.

Stuart McPhee quotes from this video:

  • You cannot find any indicators that can provide to you any advantages
Submitted by YouTube Trader on Fri, 04/09/2010 - 21:28

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