Forum Mgmnt,
In another thread we discussed the idea of trading multiple time frames using the same system. You pointed out that the trader psychology would be different across various time frames, so this might not work well (please correct me if I misunderstood your point).
This got me to thinking:
Couldn't trading psycholgy be fractal as well? If I day trade, then my horizon is the single day trading session. In this time I may have breakouts, sideways markets, periods of greater or lesser liquidity, and all of the things that someone trading on, say, a longer-term perspective would have, it's just compressed into a much shorter time. If, for example, it's been a down day, and I'm looking for the market to perhaps open lower with a bit of follow-through the next day, I will have a different perspective than a position trader who sees a long-term up tread, but that's because my time horizon is so much shorter. Thus, my psychology may be analogous to the postion trader using daily charts compared to the trader using, say, weekly charts.
I'm probably not expressing this as well as I'd like, but I'm certainly interested in your opinion (or anyone else who has thoughts to share)!
Dave
Fractal Psychology
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Dave,
You mentioned:
Humans are humans, after all. That's what allows the consistency of the markets across the decades and even across the centuries.
What I was getting at was something that relates more the psychology of events as a series over time.
Consider:
Thus Trader A above would find it easy to keep trading his system but Trader B wouldn't. So they might not respond the same way to what might appear to be similar chart patterns on each of their timeframes.
I hope that explains what I meant a bit better.
You mentioned:
Yes, this is true in terms of what affects the psychology of a particular person.If I day trade, then my horizon is the single day trading session. In this time I may have breakouts, sideways markets, periods of greater or lesser liquidity, and all of the things that someone trading on, say, a longer-term perspective would have, it's just compressed into a much shorter time.
Humans are humans, after all. That's what allows the consistency of the markets across the decades and even across the centuries.
What I was getting at was something that relates more the psychology of events as a series over time.
Consider:
- Trader A - A daytrader, has been making lots of money because of volatile (though non-directional) markets.
- Trader B - A Long-term trend follower, has been getting chopped up because of those markets.
Thus Trader A above would find it easy to keep trading his system but Trader B wouldn't. So they might not respond the same way to what might appear to be similar chart patterns on each of their timeframes.
I hope that explains what I meant a bit better.
Thank you, c.f.
Thanks,
Yes, this does explain your point well!
This is like a puzzle that just keeps getting more fscinating - hmmm...I just had another Topic idea!
Dave
Yes, this does explain your point well!
This is like a puzzle that just keeps getting more fscinating - hmmm...I just had another Topic idea!
Dave