Disliked{quote} The 9% chance of TZ is when it was being compared to all the number of bars which it looked at. It wasn't comparing it to the number of Recurrent zones. I think this is what most may not have gotten (or what I don't get). For a zone to be recurrent, it has to be H-Transient on the previous number of H bars, correct? Then the number of RZ bars won't be equal to Number_Of_Bars_In_Chart - TZ_Bars. We would have to actually have to find RZs that showed up exactly at the previous TZ levels and this number is very small. Thats why there is 85%...Ignored
For now let's focus on the idea behind the Daily GU chart that you first quoted.
I'll use your terms to try to clarify:
"all the number of bars which it looked at" = "the number of Recurrent zones"
Think of it, a price can be either recurrent or transient, if it is not Transient (9%) then it is Recurrent.
This is different than the idea of Potential Transient Zones!
"We would have to actually have to find RZs that showed up exactly at the previous TZ levels and this number is very small"
That's true, but the number isn't as small as you think. However, the aim is to get high probability trades no matter if it's 1 per hour or 1 per week!
Personally if I want to back-test, I would rather keep K on the side and focus on increasing H
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