Charting Software Roundup
Okay, everyone. Welcome back to another episode of Line Your Own Pockets. I'm personally very excited for this one because when me and Dave were always spitting back ideas what to do, we talked last week about back testing and some tools of the trade, and we said, why don't we continue this whole tools of the trade topic? He said charts. And I didn't even think Dave would use charts.
Michael:Myself, obviously, I'm a chartered market technician. I'm a big chart guy. I I like like looking at them. I think they provide value. I just figured, Dave, the joke I made before we got in is the that green text that came down the screen in the matrix.
Michael:I figured that's all Dave's monitors were. So we're gonna talk about charts. We're gonna talk about charting platforms, potentially what you need to get, like, what's important when you're looking at a charting platform. What do you need? I think more importantly, what don't you need when it comes to charts?
Michael:I think that will be a big thing that we'll talk about as well. So, Dave, you actually use charts. Holy smokes.
Dave:Yeah. I use charts. My use of them has changed a lot over the years. When I first started trading day trading, I was used I used esignal charts, which are actually quite good. Right?
Dave:They were had a good platform. They were programmable, very solid real time platform. So Yep. Those were great. Since I started automated automating my stuff, I used charts less and less.
Dave:You know, when I first started doing it, I was I had 2 monitors, then I had 4 monitors. And I maxed out at 4 monitors, which is not a lot when you look at some of the trading rigs you see people post. Crazy ones. So now I've got 3 monitors, but I really hardly have charts on any of them. I've got charts on one of them.
Dave:So Well, so I'm a one monitor guy,
Michael:but it's big. I think it's 37 or something inches. It's the I use the old joke of the guy who's like, the doctor said I can only have one drink a day, and he's like drinking beer out of, like, a 3 liter mug or something, but it's the same it's the same thing. I I would say a lot of people have gone, even discretionary traders, generally go down a simplification journey when it comes to charts. I think that's super common.
Michael:You see a new trader and they've got the 37 indicators and they've got, you know, a whole screen of monitors and and every single chart has all these crazy indicators. You can barely see the price action. And then as it gets, you know, longer and longer and people have been trading longer and longer, it starts to get more simplified. I think of the one of my favorite meme templates is like the normal distribution with the IQ chart, and you've got, like, the idiot in one corner and the genius in the other. And both of them are basically just using, like, simple candlestick or simple line charts with no indicators just to see the price action.
Michael:Then you got the guy in the middle, and he's going crazy with all of these indicators.
Dave:Yeah. I like that. That's a good I I like that name for that. That's a good purpose for it. So there's one there's one quote that I'm pretty sure I made up, which is, a lot of indicators on a chart is a sign of mediocrity.
Dave:Yep. So there's really I mean, I I think a lot you know, we've talked about this before on the on previous episodes. If there's something on my chart, I'm making a decision based on it. And if I don't make decisions based on something, I don't put it on the chart, and that's just the way it should be. Like, there's lots of data you could look at, but I mean, there's tons of data you could look at.
Dave:And, really, the the whole point of doing this and doing it well is what should I be looking at? Don't don't look at everything and then figure out what what you're gonna focus on. Look at nothing and figure out what we're gonna focus on and add it thoughtfully to your
Michael:chart. Yeah. And it's not to, completely bash indicator. I think there's a lot of, unwarranted indicator bashing that goes on. If it's part of your process, I think of, Kate Stockton, for example, who's a very famous market technician.
Michael:She runs an ETF and all this, and she has, you know, things that I would never use, like, ichimoku clouds and and things like that on her charts, but she has a process. She's looking for x, y, and z thing to occur to to make a trade, and I think that's absolutely fine. But, you're right. The problem becomes and this is just, I think, the discretionary version the traders version of curve fitting, where they keep adding indicators until something confirms the thing that they want to have happen anyway. Right.
Michael:They want to buy a certain stock and they just keep putting indicators and they go, that's oversold. That means to buy it. But, I'm with you. And the other value, I think, the indicators and the reason that I don't think you should have many of them in your chart is because that should be part of your filtering mechanism when it comes to scanning and when it comes to algorithms. Right?
Michael:All of my systems use indicators as a way to express price action, but I don't need to have those indicators on the screen because when my algorithm says, hey, you should look to buy this, I know that it's though what those indicator readings have to be in order to get on my chart. So for me, personally, I would just rather see the price action, you know, make sure that it's gelling with what the idea is behind the trade, and then and then take the trade from there.
Dave:Yeah. Yeah. I think that's, it's it's important to think about. And and here's one thing that I you don't think about right away, but, eventually, you do think about it and with regards to chart and charts. And that's, like, say you've got a bunch of monitors and you're using them.
Dave:What happens when you go on vacation?
Michael:Mhmm.
Dave:Are you gonna be able to take that trading rig to the beach? And and as you get better at trading and you make more money, those vacations go start getting very expensive just with opportunity cost. Right? A day away from the market if you're a profitable trader is a serious thing to think about. So I always try to think about when I set up charts on my screen, like, what is this gonna look like when I'm on vacation and I have a laptop?
Dave:And I and I need to be able to trade when I'm on the road or at least have that option to do it. I don't wanna be in a situation where I it's too uncomfortable to trade on a laptop. So I think about that right from the very beginning. I think that's helpful.
Michael:When I I've actually I've done the exact same thing, and I do it as a must have kind of like you talk about. When I'm thinking about trading styles and philosophies, I'll cut it cut them off if I have to sit in front of 17 monitors all day and and to do that trading style. Because, a, you're right. What happens if you go on vacation? And, b, that's just not the quality of life I want.
Michael:Right? I have a 14 inch MacBook Pro, and you can use, like, the iPad as a second monitor. Apple's got a thing that wirelessly does it. And when I travel, that's all I bring. Sometimes I don't even bring the iPad.
Michael:It just, like and it has to be able to exist, on a single screen or I'm just not interested. A, I think knowing myself, I don't have the attention span to keep an eye on 37 charts all day long. A bit TikTok brain when it comes to that kind of thing. But, yeah, I just think out of necessity, you should just be able to grab one chart or or one screen, and you should be able to go through those things. And, yeah, the people that I see on vacation that have, you know, a bunch of external monitors they brought and all that.
Michael:Again, I just think, a, is that really helping you? And, b, is that the the life that you wanna lead to where you're you know, if I'm if I'm have to be chained to this desk anyway, there's probably better things I could do. Right? I, you know, I could create systems and then do other things. I want the freedom to be able to go to a coffee shop and work there if I want or or or go wherever I want in the world?
Dave:Yeah. I mean, it's really a it becomes a resource constraint. Like, if your systems and your strategies depend on you having more and more monitors, then you're you're gonna come upon a limit. Yeah. Like, you're there's only so many trades you're gonna be able to make doing that.
Dave:There's only so many monitors you're gonna be able to display. And, so you could you you should be able to look ahead in the future and see that's not a very sustainable approach.
Michael:Yeah. Even just mentally keeping track of that. So, you know, now that we're we're kind of talking about the use of charts, I guess we should get into the platforms of it. And the first one I I wanted to bring up, David, which I think most people overlook, and they shouldn't, it's just your broker. Right?
Michael:All brokers have charts. If your charts don't need to be crazy like we talked about, in a lot of cases, you know, the I I use personally interactive brokers. I'm not a fan of interactive brokers platform. I I hope they're not watching this, but I know they're working on it. It just seemed it's just it's it's big and bloated and cumbersome and complicated.
Michael:So I'll talk about my preferred charting platform, down the road. But I think for a lot of people, just grab your broker. They're already giving you the data. It's gonna be free in a lot of cases. And and I know, for example, thinkorswim down in the states is something that I've seen, like, really hardcore technical analysts use entirely thinkorswim for their entire process.
Dave:Yeah. I use IB for charts just because it's simple. I don't really have I I literally have no indicators on those charts. I'm just looking at the price action for the fills that I'm getting, and
Michael:Yeah.
Dave:It's great for that. You don't have to, you know, there's no external linking to worry about. It's all right there. So that's nice. But, yeah, I agree.
Dave:That's a that's a great first thing. I mean, I I like that you know, it's good to put it's always good to have constraints on yourself and to sort of force yourself to get by with something if you have to. Like, just even if just as just as a thought experiment. And it really forces you to say, okay. Well, if I'm gonna get another charting platform, here's the baseline.
Dave:Look at my broker. What does it do? I get that for free, probably. What's something else gonna get me? And what is that what's it gonna cost, and what's the benefits gonna be of using it?
Dave:Because it it's gonna add a little bit of cost and a little bit of complexity to what you're doing.
Michael:Yeah. I think I think the next step up from there is is look at your scanning platform and see if they have charts associated with it and if they're any better. Right? So I'm specifically talking about, trade ideas here, which I know Dave uses for a lot of his execution and and I do as well. They have built in charts as well.
Michael:They're not the fanciest thing in the world. The my favorite part is just the fundamental data they have on them, but they do a lot of the same. And the beauty of that is that if you're doing some quick scanning, if you're clicking through charts from your scanning platform, if that also has a charting platform built in, there's a little bit of ease of use there. Whereas opposed to setting up some sort of linking or or typing them in yourself or copying and pasting data, there is some some idea that that you can do as well. You know, you mentioned esignal.
Michael:I know they have some basic scanning capabilities. TrendSpider has some scanning capabilities. Right? Again, I'd say the next step up is, okay, now you're gonna look to pay for something, but maybe you look at something that you're already paying for for a different reason, and then look at their charts. And they can do the experiment that Dave just talked about.
Michael:Is there something missing and and something missing that I really think is going to make the difference? So when it comes to, like, trade ideas charts, the limitations are they're not as smooth as a lot of charts, and and, you know, they're in there's not as much indicators out there. There's not a 1000000000 indicators as your very popular ones. So just look at that and say, well, I'm paying for this anyway. Can I can I kind of look at those instead?
Dave:Yeah. There's there's another really good use for charts, which is not just, you know, trading off them, but to do research after hours. And the really the thing that I really like about trade ideas charts is the little blue arrow that goes Yes. When you double click on an alert window, and it changes the chart, and it ship plus it shows you the blue arrow exactly when that alert occurred on the chart. That's so key, and it's really important to be able to do that.
Dave:And that's a lot of the research you could do after hours. You do you get the same thing when you do back testing in trade ideas. That there's the the setup is shown on the chart. Yeah. That's really a critical thing to be able to see and just not a difficult thing to, you know, eyeball it without those indicators on there, but it's so nice to have that.
Dave:It just saves a good bit of
Michael:time. Yeah. If it saves you know, if if you think about if it saves a couple seconds. But if it saves a couple seconds and and you're looking at 10 or 20 setups a day and then you multiply that out by weeks and then months and then years, Any sort of quality life, improvements like there. You know?
Michael:Then I think kind of the next step from there is, you know, do you need a advanced charting platform for something that you do? Me, personally, on top of the systematic trading I do, I do a lot of kind of longer term analysis and macro analysis, things like that. So my go to is for that is TradingView. You know, that's a very, very reasonable price. They have access to every market you can think of.
Michael:I if I if I'm gonna crown a king, I think, of charting, I I probably put trading view there. Now the question I think you have to ask yourself is, is an expense like that necessary? It's not a lot, especially if you do, like, a Black Friday deal or something. You're getting the whole year's platform for a couple $100. But is that complexity something you need?
Michael:So a quick example is that, trading view can output information via web webhooks when it comes to alerts and things like that. And that's something that I use for the service I run on my website and and things like that. So there is some functionality I need, but as a chart nerd, I just think they're the best when it comes to aesthetics and, you know, indicators, multiple time frames, and all of that. But at the same time, what they lack is that dedicated kind of scanning component. So I think, you know, what we're what we're kind of going through is there's, like, an expect a spectrum of charting.
Michael:Right? And the question is, how much do you actually need really nice, tight, advanced charts versus how much are you just looking at price action from day to day, and it's something that you can get by. And then the further you go up that spectrum, the more you're paying for just an exact charting platform. Again, you mentioned esignal. If I remember correctly, esignal was pretty pricey when it came to their when it came to their charts, but there's a whole lot you could do with it if it's something that you needed.
Dave:Yeah. It's, it is pricey, but and a lot of this, the real time data feed. If you don't need that real time data feed, then probably not worth you looking at a signal. So you mentioned webhooks with your trading view and your website. How does that work exactly?
Dave:What's going on there?
Michael:So, well, one of the things that I do so I as a swing trader and a long term investor, I have these systems that I back test. And part of my process is at the end of every week, that's when the new data comes in, that's when I run the back test, and that's when I set up my alerts. But what you can do is you can send those via webhook either to something like a trading system, like a signal stack or for me, some of the forex works I do will actually just send a trade alert or trade directly to the platform. The other thing is I send it to my Discord. So we have a small Discord room where we chat, and then, basically, what I'm able to do is I'm able to share my alerts in real time with the people that are there.
Michael:So it you can just send a message with, JSON. Does that make sense? I have a I have a little Chrome extension that I don't understand that I copy what I want the alert to say and I paste it and I'll put something. So when the alert gets hit, it triggers that. And the thing that I like about that is as, again, someone who very much doesn't want to be at the screen all day, it goes to your phone, it goes to your smartwatch, it goes to whatever, and it'll say, hey, this, stock triggered this.
Michael:Now go take a look at it. And that's something that's really, really valuable to me because I want to be alerted anywhere because as a swing trader, there might be days or even weeks sometimes where I don't do anything. So I can't, you know, take the time to stare at it. So I want to be alerted. I want to be able to know this is the entry price is the stop loss price.
Michael:Now go bring up
Dave:the chart and see if it's something you wanna take action on. Yeah. It's funny. The pause you had there before you said JSON is kinda will be kinda funny to the developers in the audience. I think they'll laugh at that.
Dave:Because, yeah, JSON's a common interchange format, sort of a sort of I think of it as, like, the next generation of XML. Uh-huh. Very common format to exchange and, like, describe and, interchange data. That's a good topic. The the next one are you ready for me to bring up another one?
Dave:I've got another chart
Michael:to go
Dave:for you. Yeah. So what I really like is Amibroker. I know we talked about this last week as a backtesting platform, but their charts, I really like, and, and the developer in me really likes because the one thing it allows you to do is you can backtest a strategy. So they have their own, AFL and a broker function language, I think, and you you program a a system in there.
Dave:And what you could do, you can use that same file that you used for a strategy and and put that on a chart. So the same signals, the same code, the same variables that are going into your trading system, you can put 2 lines at the end of that file, and it becomes a chart. So what that allows you to do is have one file of code, one code base, and it's running your strategy and your chart. And that's really important because when you're when you're in the weeds of your trading strategy and you want to visualize something on the chart, it's very easy to be able to use the code in there to draw a line, like draw a little arrow right where you wanna see something. But the indicator values in a very subtle way where you can look at the if you want to.
Dave:So you can cram a lot of details in there that you can't see by default, but when you hover your mouse over, you can see it. So there's just tons of flexibility with doing that. I mean, one thing I would do would put put a little, like, a tiny little block at the very bottom of the chart area when, like, the signal is, setup was the setup exists, but it hadn't traded yet. So there's lots of little things you can get really good at and colorful and, like, really show exactly what you wanna see, which I love.
Michael:And I will say, RealTest does the same to, some some degree. Now it's not real time data, so your chart will get updated when you import your data at the end of the the week or month. But, yeah, you can do you can apply the same indicators. You can you can, with a little bit of code, put an arrow where it does. It will show you if you're clicking through the past trades.
Michael:It will it will highlight the entry. It will highlight the exit and give you the reason and some of the same functionality. So that's another thing to look at as well. And a question I think people should ask themselves is do you need real time real time charts? I will say, again, if you missed last week's episode when we went through back testing system, you definitely have to, definitely have to watch that.
Michael:But, that's one thing that I liked when I did try Amni broker is their charts were very, very flexible, and I like that. Again, as someone who does all of I'd say 90% of my trading work is done after hours, and literally throughout the week, I'm just waiting for that alert to come in and and taking a trade if I like the if I like the setup. I like I don't need that real time data a lot, so that would be something I think a a listener should ask themselves is if you're running a back tester like an AFL or something like that, would that be the best way to screen the results for, you know, what you're gonna trade going into tomorrow if you're a day trader going into the, the following week, if you're more of a swing trader. And then maybe from there, you're even just using your broker's chart, even if it's a Robinhood or something like that. Because again, for me, the actual art of trading, I could completely do for my phone because I'm just waiting for the alert to come in and I'm doing and then go going back to interactive brokers, their iPhone version.
Michael:I don't know if you've played with it too much, Dave, but their iPhone version is actually way better than their downloaded version. It's it's more user friendly, it's it's lighter, it's more simple, it's sometimes I want to grab my phone to take a trade instead of going to the actual, TWS itself so yeah, maybe your back tester has the ability wherever you're back testing with you can do all the chart work there and then just use lean on something else like your broker when it comes for real time action.
Dave:Yeah. There's that that brings up another platform. So it's a little years ago, I created a charting platform as part of StockTicker, the the first online trading journal company that I started, and then sold the trade ideas. At first, I used some 3rd party charts, but then I was like, man, I could save a lot of money if I just code up my own charting platform here because I already had the data feed. And and I thought at the time, man, I could never do that.
Dave:Like, that things really hard. But when you get down to it and just look at the you know, you're basically doing geometry and code.
Michael:Mhmm.
Dave:It's not as hard as you think it is. That it it's not hard to create a basic chart. It's hard to create a really good chart that has a lot of bells and whistles. But to create a basic chart, it's actually not that hard. And even today, like, there's several libraries you could use to create your own charts out of, you know, using Python.
Dave:In fact, that's one thing that I've done is just for my own personal workflow, like, looking at charts from a backtest in a way in the exact way I wanna see it with exact, data I'd like to see on it. I've got some code that actually creates the charts, and I can scroll through 100 of charts looking for a particular pattern that I wanna look at. So that's another thing that, the developers in the crowd know we do I know we have some developers, that are listeners. That's that's an option now. And certainly with chat gpt, it's never been easier to do something like that.
Michael:Well, it's funny. A little history lesson for everyone, but, right, candlestick charts were made a 150 years ago. A guy trading rice in in the in Japan, became what would be inflation adjusted a billionaire. He became a samurai, which is the ability of, like, basically getting knighted. And his whole idea was that they were simple.
Michael:That's the whole reason he invented candlestick charts. He wanted to see an entire day's worth of data. And because he was drawing them out by hand, he just wanted to be able to go home and draw something that that encompass that data. So it does make sense that, you know, if you're just sticking to basic line or candlestick charts, it does become very simple because it's high, low, open, close. And as long as you plot those and and do the the graphics correctly, it makes sense.
Michael:So and I think that's just more to say that you shouldn't be spending a cred ton of money to to do some sort of crazy advanced charting. Right? Because, even as someone, again, as a chartered market technician who presents and does macro analysis and writes reports and all this kind of stuff, the best charts and the charts that I share, most people can go on Twitter and look. It's a white background. It's black bar charts, and and that's about it.
Michael:And and the more that I find myself getting pulled from that really basic idea, the the more that I'm probably in trouble. Right? Because I'm trying to curve fit my own brain. So, yeah, start simple. Right?
Michael:Start something that's very basic. Make it very clean for your eye to see, and and avoid the pull of going too crazy when it comes to comes to different charting platforms.
Dave:So, Michael, do you ever use anything besides candlesticks for your charts?
Michael:I am a closeted in column bar charts or high low open close charts. Right. Just the the bar with the two lines on the end and unicolor. So black on a white background or white on a black background. But when I share them, I always have to go to candlestick charts because I the general public doesn't understand them as well.
Michael:And it's funny, I was talking to Brian Shannon the other day, and he's the same way. He's like, I use these charts when I'm when I'm same kind of thing, the high, low, open, close black charts, and he's like, but when I share charts, I have to do candlesticks because if I don't, the first five questions is people don't because they everyone's learned to read candlestick charts. They don't understand that the bar chart's the exact same data. It's just simple. I just I don't like the multicolor.
Michael:I think there could even be some bias when it comes to red means bad, green means good. You I find you focus too much on an individual candle. Whereas if your charts are just clean, one color, very simple, you're you're you're more looking at the chart pattern than than anything else, if that makes sense.
Dave:Yeah. I I use candlestick charts, so I guess you're the I guess I'm the the kind of person that you're having to switch for when you post them. It reminds me so it reminds me do you ever play cards, poker or anything? Oh, yeah. There's, you know, there's a standard 2 color deck.
Dave:Right? You get red and black for the suits. Right? There's, there are there are cards that have 4 colors. So I think it's the I think diamond is blue.
Dave:And, so there's 4 colors for those. And to me, that makes very much logical sense. Right? Why would you have 2 suits with the same color?
Michael:Mhmm.
Dave:It'd be much easier to have 4 different colors. But for some reason, never caught on. It's hard to find these, 4 color decks. But to me, it makes total sense. But, hey, I'm not, it it certainly hasn't caught on.
Michael:Yeah. And it's it I do think there's there is a bias that can happen. Now the more systematic you get, I think the less of a problem it becomes, you know, where you're not if you're looking at each individual candles as as a potential way to make a decision, I think that's where the problem lies. So I think you need to you need to focus on that. But, yeah, I'm more of the get the colors.
Michael:If I do candles, it's like a white up bar and a black down bar just like the old the old school guys, but, it's very interesting. I've even played with, different charting, and this was one question I was gonna ask. Like, have you ever played with point figure charts? Have you ever played with even tick charts? Or or what's the what's the weird one I see all the time that I still don't understand?
Michael:It's like rank ranky something. Have you ever seen those where it's like there's bottom shadows but not upper and weird funky charts like that?
Dave:I know there's all different sorts of charts, but they've never seemed to have much value to me other than the basic charts. Maybe one day I'll look at them, but I I don't feel the need to right now. So stick with the standard stuff.
Michael:Now I guess the other thing that I wanted to mention too is is always know your your OS. Right? What are you using as a as a computer? And this is, I guess, something that's just special to me as a Mac nerd. It's one of the reasons I think I like trading view so much is because and if you're doing everything on one platform, that's something that you obviously need to check when it comes to your charting.
Michael:So something like trading view, works on everything. Trade ideas has a limited web version, but most of what they do is is in the app as well. So that's something that, again, I really think is something that you need to focus on for some people. Like, I know a lot of the devs and the coders might be Linux people that we we watch, but there is so much when it comes to HTML and and web based charts that are out there that I don't think that's gonna be a huge problem. But, yeah, some of and I would say, actually, a lot of the trading industry is Windows based, so you need to make sure that if you're if you're gonna get serious into it that you have something.
Michael:And I have a little Windows tower in my house that I remote into for for that kind of thing, but just something to consider for for any of the nerds out me or just Apple sheep and and buy everything they put out.
Dave:Yeah. I've I only use a a downloadable platform for my charting and any, trading applications. So I I don't use any browser based charts, actually.
Michael:It'd be interesting because, yeah, you don't you don't do anything because you're you're taking the trade at the beginning of the day. You're out by the end of the day. You're probably done watching the the trade, you know, in the first 30 minutes or so of the day. I guess nothing mobile to you really makes a lot of sense because you you're dialed in for that first period of time when you're placing your orders and everything, and then you're probably trying to detach the best you can.
Dave:Yeah. So I don't there have been, I don't know, maybe a handful of times I'll check something on my phone, but I rarely very rarely ever do that.
Michael:But and this is something I guess completely off topic, but please, I don't know. I was talking to a trader the other day who his power and his Internet went out, and he didn't have his broker app installed on his phone. And and I felt like going over there and slapping him. So if there's anyone listening to this that you don't have a broker, even if you don't wanna look at it, even if you're someone like Dave, right, who puts in all of his orders with a robot and then just walks away and you're in cash at the end of the day, that's absolutely fine. But just as an emergency mechanism, right, having the ability just to pick up your phone and and, you know, liquidate some positions or, or even tethering your laptop to your phone or something.
Michael:You should have that kind of backup because hurricanes, you know, up here in Canada, we have snowstorms and ice storms that can knock out power and Internet. Yeah. Just something that happened to me the other day when I was talking to a guy. Thankfully, it ended up making a money, but it's, like, just as easily could have been bad. Right?
Michael:Make sure you're either using, so my suggestion to him was obviously have that always on your phone and then look into some, you know, maybe VPS or something to run his trades. I know there's a lot of people that do that where they have something hosted on AWS or Azure or something like that, just a dedicated workspace, and that's gonna run everything. So regardless of what happens locally, you just have some sort of backup because, yeah, this guy was this guy was very, very scared.
Dave:Yeah. I mean, there's, somebody I worked for a while back would always say just be paranoid. Be paranoid. Like, the worst thing that can happen is eventually gonna happen, and you need to plan for it and think about it. Yeah.
Michael:Well, such charting platforms. And and I think the the long story short, if we just wanna summarize everything, I'd say for 90% of cases, your broker will do a good job. I'd say for another 5% of cases, the back tester that you're using, whatever software you're using for back test and scanning, will probably make up the rest. Your broker for real time, your, your scanning or back testing platform to go over the trades that you're looking at. And then only for really special nerds like me do you need to go and and and do something crazy.
Michael:And and it's I knew this would be a message that me and Dave would both be aligned on because it just seems like one of those things like having the fastest computer in the world. There's a lot of people that think that if they have the fanciest charts in the world that somehow will help. I I agree with Dave that I think in most cases, if you kind of took things from people on purpose, like, if I sat you down and said, okay. Your only trading platform has just the most bare bones, you know, green bar up, red bar down, candlestick charts, no indicators, no nothing. And I think in a lot of cases, that would actually end up doing better for a lot of traders.
Dave:Yeah. And I think, just as you were talking there, that made me think that, you know, if charts are they could be made to look really pretty. Right? You could put all these sort of fancy indicators on there and sort of catch your eye, but that should be sort of a red flag. If something is catching your eye on a chart, that should be a red flag that, okay.
Dave:What am I actually using this for? Is is this eye candy gonna be helping me or really kinda distracting me?
Michael:Well, it's it's, it's funny because I'm listening to because you recommended one of Nate Silver's books, his newest one. And I listened to that, and that was great. So I went back to listen to his old one, and he, the signal and the noise, it's called. And he's talking a lot about how the human brain is essentially programmed to make inferences based off things that we see. And the idea is, you know, you hear you see a rustling in a bush.
Michael:It's better to assume that it's something than it's nothing, and and same with, like, looking at shapes and clouds. I think a lot of people with their charts do that quite a bit where they'll put an indicator on their chart, and they'll go through and their brain notices the times that that would have been an amazing time, and not all the 17 times that that would have that would have lost. So, yeah, just like Dave saying, it's just be be very careful. If you put something on the chart and it looks like it's just lining up very, very well, and it's gonna make you a whole bunch of money, Doesn't mean it's not going to, but it's something to be skeptical about, and then that's where our last episode comes into play. We'll take it back to us.
Michael:See if it see if it does add an edge, see if it does something, before you're ending up just throwing it on a chart and staring at it and making decisions, because it looks good on that one stock, that one time where, again, you saw a couple of occurrences where it made sense.
Dave:Yep. I agree. I I think that might be a good place to wrap it up.
Michael:Let's wrap it up, and we have a very special episode next week that I'm very excited about. I don't think we'll tease too much about it, but it does tie in to everything we were talking about, and it's gonna be a lot of fun. So I will see you guys next week.
Dave:Alright. See you next week.
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