I can understand that. The intuitiveness is a factor.
But a lot is common sense and acquired sense.
For example, one technique is to watch for a crossing of (come to think of it, it is occurring right now) a longer and shorter MA with the market at the same time. Watching this over a period of time one will gather his or her own impressions on the results. When I used to tabulate, I found that roughly 70% of the time there was a sharp spike coming within the next 3 bars (15 minutes).
Direction is next. A 7 out of 10 shot does no good without a clue towards direction. I don't remember the percentage, but a significantly high % of the time the market spiked along the slope of the longer MA. That is to say, if the longer MA was moving down the motion was down. The downward motion has a higher frequency than the up.
Such a move would usually, not always, produce a resulting spike (up, for example) for 5 minutes, a minor retracement, another 5 minute bar up eclipsing the first. What to do? Usually, bail on part of the position....set a stop at the other end of the second bar.
Just an example. But you can see that it is not purely intuitive. It's a percentage play and it has rules. If it were purely intuitive, certainly emotion would eventually destroy me. |
