Hi,
Curious as to what any of you feel are misdirections in trading and metatrader. Like the magician directing your attention with one hand while he steals your wallet with the other I feel there are at least a few things right in front of our eyes that are designed to disorientate us and make everything harder than it already is and already needs to be.
I don't expect any of this to be a revelation to anyone, but to start things rolling I have sitting gnawing at my brain the following :
1. MT4 Charts are generated dynamically to fill the chart window. This means that in a low volatility situation where the bars are only moving up and down a few pips over a long enough period the chart is effectively zoomed in on the price axis to show you a range of only a few pips. Then, in high volatility times where bars are moving up and down over many pips the charts then have to accommodate this larger range of movement so your chart is effectively zoomed out on the price axis.
If trying to get a 'feel' of how price moves then this becomes a futile task as you just let the charts draw themselves how they want. With everything being distorted depending on volatility you have little hope. Yes, you can play with the chart properties 'scale fix' etc, but this is far from simple and efficient.
My personal solution is to drag along the price axis so that it scales to my preferred number of pips. This is simple enough when using an indicator that draws lines at round numbers as you can simply scale the price axis until you fit in however many sections between round numbers that you prefer to see. This gives a more solid and consistent perspective on how the price has been behaving. If you are always looking at a consistent range of pips then you can begin to see price movement more clearly.
2. Has anyone noticed their tick chart spread not matching the bar chart? I just checked now and they are actually matching, however, I am certain that in the past when writing some indicators I have seen them not matching at all and are out by about 1 pip both directions. Is this something that occurs at high volume times only perhaps? I suspect that the difference may have been the broker markup in spread being shown in one place but not the other. Maybe this is something that has been patched out of MT4 along the way and I hadn't noticed until now.
3. Bar / Candlesticks / timeframe dependent data. As I understand it candlesticks originates from Japanese rice trading 'back in the day'. I do not believe they are at all helpful to a trader. At all. If you offset any candlestick data by x seconds you will see a completely different 'picture' of candlesticks, however, the movement of the data is exactly the same. The only difference is the timing has been offset. Candlesticks are good for looking pretty and allowing newbies to think that all they need to do is read some Nison about candlesticks and they will make money. They are the flashing lights to draw in the crowd. Quite simply they are a form of indicator... which leads to...
4. Indicators. With a bunch of them ready to go right out of the MT4 box I feel they are there for people to drown themselves in. Add this indi here, oh now add that one there, oh let's also add this one here for this... and so on. Like taking your car to a mechanic for a sale on wheel alignments, and somehow driving-out hours later with a new set of tyres + oil change + new radiator + etc + etc... oh, and a wheel alignment. LOOK AT THE PRETTY LIGHTS! They say "the best things in life are free", but in forex I'm not so sure. Why would they give you all of these things, for free, if most traders are going to lose anyway. Keep the traders distracted with the bells and whistles and they won't notice the brokers buying a new house with the money the trader just handed to them. Keep them toying away at the puzzles and they will keep plugging their money into the account.
5. Pipettes. Quoting to an extra decimal place? Really? To me this seems to be a bad thing dressed-up to be a good thing. "No really, your car looks better with that big dent I accidentally made". Let them become so focused on the small details they don't see the bigger picture.
6. Small gripe, but worth noting. Financial Advisors on TV. Does anyone else think it's a lot of "blah blah blah, with a small chance of rain"? For anyone that cares enough about finances and stocks etc, they will already have been online reading the actual financial news and so on. What good is someone from bank / broker x doing anyone getting on TV and speaking hours-old information? My personal view is it is simply to advertise their bank / brokerage. Newbies who are just beginning to consider trading need to get a broker, right? Why not get an account with the place they have seen each and every night on TV? It must be a safe place to go to right? It is on TV each night, after all. Surely they won't rob me blind if I'm too lazy to research more cost-efficient places to trade through?
That is all for now. This may simply be another one of my rambles. If anyone has anything to add or subtract (or multiply and divide) then have at it.
Peace out.
Curious as to what any of you feel are misdirections in trading and metatrader. Like the magician directing your attention with one hand while he steals your wallet with the other I feel there are at least a few things right in front of our eyes that are designed to disorientate us and make everything harder than it already is and already needs to be.
I don't expect any of this to be a revelation to anyone, but to start things rolling I have sitting gnawing at my brain the following :
1. MT4 Charts are generated dynamically to fill the chart window. This means that in a low volatility situation where the bars are only moving up and down a few pips over a long enough period the chart is effectively zoomed in on the price axis to show you a range of only a few pips. Then, in high volatility times where bars are moving up and down over many pips the charts then have to accommodate this larger range of movement so your chart is effectively zoomed out on the price axis.
If trying to get a 'feel' of how price moves then this becomes a futile task as you just let the charts draw themselves how they want. With everything being distorted depending on volatility you have little hope. Yes, you can play with the chart properties 'scale fix' etc, but this is far from simple and efficient.
My personal solution is to drag along the price axis so that it scales to my preferred number of pips. This is simple enough when using an indicator that draws lines at round numbers as you can simply scale the price axis until you fit in however many sections between round numbers that you prefer to see. This gives a more solid and consistent perspective on how the price has been behaving. If you are always looking at a consistent range of pips then you can begin to see price movement more clearly.
2. Has anyone noticed their tick chart spread not matching the bar chart? I just checked now and they are actually matching, however, I am certain that in the past when writing some indicators I have seen them not matching at all and are out by about 1 pip both directions. Is this something that occurs at high volume times only perhaps? I suspect that the difference may have been the broker markup in spread being shown in one place but not the other. Maybe this is something that has been patched out of MT4 along the way and I hadn't noticed until now.
3. Bar / Candlesticks / timeframe dependent data. As I understand it candlesticks originates from Japanese rice trading 'back in the day'. I do not believe they are at all helpful to a trader. At all. If you offset any candlestick data by x seconds you will see a completely different 'picture' of candlesticks, however, the movement of the data is exactly the same. The only difference is the timing has been offset. Candlesticks are good for looking pretty and allowing newbies to think that all they need to do is read some Nison about candlesticks and they will make money. They are the flashing lights to draw in the crowd. Quite simply they are a form of indicator... which leads to...
4. Indicators. With a bunch of them ready to go right out of the MT4 box I feel they are there for people to drown themselves in. Add this indi here, oh now add that one there, oh let's also add this one here for this... and so on. Like taking your car to a mechanic for a sale on wheel alignments, and somehow driving-out hours later with a new set of tyres + oil change + new radiator + etc + etc... oh, and a wheel alignment. LOOK AT THE PRETTY LIGHTS! They say "the best things in life are free", but in forex I'm not so sure. Why would they give you all of these things, for free, if most traders are going to lose anyway. Keep the traders distracted with the bells and whistles and they won't notice the brokers buying a new house with the money the trader just handed to them. Keep them toying away at the puzzles and they will keep plugging their money into the account.
5. Pipettes. Quoting to an extra decimal place? Really? To me this seems to be a bad thing dressed-up to be a good thing. "No really, your car looks better with that big dent I accidentally made". Let them become so focused on the small details they don't see the bigger picture.
6. Small gripe, but worth noting. Financial Advisors on TV. Does anyone else think it's a lot of "blah blah blah, with a small chance of rain"? For anyone that cares enough about finances and stocks etc, they will already have been online reading the actual financial news and so on. What good is someone from bank / broker x doing anyone getting on TV and speaking hours-old information? My personal view is it is simply to advertise their bank / brokerage. Newbies who are just beginning to consider trading need to get a broker, right? Why not get an account with the place they have seen each and every night on TV? It must be a safe place to go to right? It is on TV each night, after all. Surely they won't rob me blind if I'm too lazy to research more cost-efficient places to trade through?
That is all for now. This may simply be another one of my rambles. If anyone has anything to add or subtract (or multiply and divide) then have at it.
Peace out.
Congratulations ScalaFX for coming out of the closet!