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Hanover - can you help me with MT4 qs please? 4 replies

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Hanover replies to PMs

  • #801
  • Sep 15, 2017 9:07am Sep 15, 2017 9:07am
Quoting hanover
I must take a break from forums now, to attend to other projects. I won't be around to answer any questions (or e-mails) until November. Happy trading all.
Have a good one, cheers
  • #802
  • Sep 15, 2017 10:07am Sep 15, 2017 10:07am
Quoting hanover
I must take a break from forums now, to attend to other projects. I won't be around to answer any questions (or e-mails) until November. Happy trading all.
Have a great break H. Looking forward to the day that sanity returns in November :-)
  • #803
  • Sep 15, 2017 3:32pm Sep 15, 2017 3:32pm
Quoting hanover
I must take a break from forums now, to attend to other projects. I won't be around to answer any questions (or e-mails) until November. Happy trading all.
Good Luck with your projects David!

We will surely 'miss' -Hanover's posts- until November.

--------------------------------

Quoting hanover
{quote}Trading forums inevitably have their share of trolls, naysayers, blowhards and freeloaders
As I'm not an English native speaker, you made me search for these terms (except Troll) LOL

http://www.urbandictionary.com/

Troll:

An angry monster who lives under a bridge, eats goats, and vents his rage on Forex Factory:

"
Quoting GJscalper
{quote} You are such an idiot. Everyone knows that account was margin called bro. lol
"

Naysayer:

Someone with an aggressively negative attitude:

"I have to avoid him because he's just a naysayer. He drains my batteries."

Blow-hard:

Someone who boasts excessively and exaggeratively about his or her imagined talents or abilities:

"Ever since John started attending Yale University, he has become such a blow-hard."

Freeloader:

A freeloader is someone who exploits chances to get free stuff whenever possible:

"Hey man can you buy me food for the week?"
"No stop being a Freeloader for once"

---------------------------------
  • #804
  • Edited 4:25am Sep 26, 2017 4:06am | Edited 4:25am
Quoting aud
Or do you? Let us say a pullback was hedged...... Now let us say the first trade was made with a S/L that made sense to the trader and cost 35 pips, also the trade represented a risk of 2%.
The risk% per trade is both irrelevant and misleading. For the replication to work correctly it must simply maintain the same net NUMBER OF LOTS (long, short, or zero), as unhedged positions, and then adjust this accordingly on the same price tick whenever the hedger changes his net position. Remember, the goal is to exactly replicate the hedger's strategy, not to introduce a risk model of our own design.

A SL or TP merely adjusts the net position. (What many people don't seem to grasp is that a SL and TP on a buy order are actually both sell orders; and vice versa. Platforms like MT4 can shape your thinking so that you mentally group entry/SL/TP as a single trade unit, when in reality they are 3 completely separate orders in the market). Hence if one of the hedger's orders hits its SL or TP, the replication recalculates the hedger's new net position IN LOTS, and adjusts its unhedged position(s) -- by closing existing orders and/or adding new ones -- to reflect the same overall net size (long, short, or zero). Whenever the hedger's net position is zero (a perfectly balanced hedge), the replication simply closes all open positions and stays out of the market. Then when the hedger later unhedges (e.g. by closing a buy order of X lots to leave himself net short), the replication simply opens a sell order of X lots. And so on.

As long as the replication maintains the same net position IN LOTS as the hedger at every point along the way, it must necessarily make the same number of pips, and P/L, as the hedger. QED.
  • #805
  • Sep 27, 2017 9:23pm Sep 27, 2017 9:23pm
Quoting Kleva
goodday mr over, from my view i sense that u are an experience coder with forex knowledge. i would like us to work together permit me to use that word WORK bcos i have abt 3 systems to code into ea, i need ur help to code at least one for me . when i forward test that i will show u result then to do the others Thank u
I am sorry, but I no longer code EAs for other traders.

You could try posting your ideas in one of the "I code for free" threads, or if you're willing to pay for the development, Google something like "MT4 programmer". There are many programmers willing to code for money. But I am not one of them.
  • #806
  • Sep 28, 2017 4:08am Sep 28, 2017 4:08am
Quoting hanover
{quote} I am sorry, but I no longer code EAs for other traders. You could try posting your ideas in one of the "I code for free" threads, or if you're willing to pay for the development, Google something like "MT4 programmer". There are many programmers willing to code for money. But I am not one of them.
, Hanover, u sound like a Great man, the kind of person i would have met long ago, great people have a natural concept of oneness and believe in the power of the human unity, Hanover, u will code this one for me and we will name it the Last EA. let me know when u are ready, even till next year.
  • #807
  • Sep 28, 2017 5:08am Sep 28, 2017 5:08am
Quoting Kleva
{quote} , Hanover, u sound like a Great man, the kind of person i would have met long ago, great people have a natural concept of oneness and believe in the power of the human unity, Hanover, u will code this one for me and we will name it the Last EA. let me know when u are ready, even till next year.
lol
  • #808
  • Sep 28, 2017 5:34am Sep 28, 2017 5:34am
Hello Hanover, I have been working on a strategy which involves straddling specific candles if their ranges are within a certain size. I've noticed for a specific currency that for the last year it's given me a 70% win rate with 1:1 risk. It was on GBPUSD, however when I check data for a year prior to that which involves pre-brexit volatility, the winrate goes down significantly to like 55%, and another year further it goes down to 50%.

My conclusion, is that the way gbpusd functions has changed, and that in the future price behaviour will change again, thus my strategy will not last. Is there anything I can do to save this strategy?
HMSR
  • #809
  • Sep 28, 2017 7:26am Sep 28, 2017 7:26am
Quoting Hmsr
Hello Hanover, I have been working on a strategy which involves straddling specific candles if their ranges are within a certain size. I've noticed for a specific currency that for the last year it's given me a 70% win rate with 1:1 risk. It was on GBPUSD, however when I check data for a year prior to that which involves pre-brexit volatility, the winrate goes down significantly to like 55%, and another year further it goes down to 50%. My conclusion, is that the way gbpusd functions has changed, and that in the future price behaviour will change...
when next u go to the shopping mall , ask of what they call filter. so u can come and filter the entry and exit parameters

regards
  • #810
  • Sep 28, 2017 8:13am Sep 28, 2017 8:13am
Quoting Hmsr
Hello Hanover, I have been working on a strategy which involves straddling specific candles if their ranges are within a certain size. I've noticed for a specific currency that for the last year it's given me a 70% win rate with 1:1 risk. It was on GBPUSD, however when I check data for a year prior to that which involves pre-brexit volatility, the winrate goes down significantly to like 55%, and another year further it goes down to 50%. My conclusion, is that the way gbpusd functions has changed, and that in the future price behaviour will change...
I'm sorry Hanover if I get over my head to answer this question as it's really directed to you ...

There are 2 things that I think you can do to remedy this situation:
1. As Kleva had mentioned, adding more criterias to your selected range of play is a possibility, for example lowering the playable range ...
2. I had almost the same problem on my previously used strategy, so I just changed the TP to Half-TP and the Win-Rate went up to over 75% ... (currently your Win-Rate is at 58% on average, which is above the break-even threshold of 1R)

Mathematically speaking and assuming the amount is almost constant, a 0.5R will break even at 66.7% Win-Rate ... So if the Win-Rate can go above that, then we have an edge ...
Market is not random but unpredictable
  • #811
  • Sep 28, 2017 8:25am Sep 28, 2017 8:25am
Quoting 4for4
{quote} I'm sorry Hanover if I get over my head to answer this question as it's really directed to you ... There are 2 things that I think you can do to remedy this situation: 1. As Kleva had mentioned, adding more criterias to your selected range of play is a possibility, for example lowering the playable range ... 2. I had almost the same problem on my previously used strategy, so I just changed the TP to Half-TP and the Win-Rate went up to over 75% ... (currently your Win-Rate is at 58% on average, which is above the break-even threshold...


I understand what you are saying, makes sense and I will try it, perhaps the numbers will be favorable. And after that I might even try testing the results for 0.25:1 R:R and hope for a probability above 80% which is good territory to consider Martingale those losses ... (or start it after 2 losses to be extra safe)

Another example I had was trading it on days of expected volatility like high impact news days, some periods of like 8 months testing I got 75% win rate on 1:1 R:R. But then I'd test earlier periods and I'd get 50% R:R. So that either means price behavior changes yearly, or specifically on GBPUSD, the brexit changed things up.

Also are there any other parameters that can be added?
So now I have considered: specific candles, specific range bounds, whether or not High Impact news that day,


Also are there any external sources of data that can suggest that there may be greater factors of influence that affect currencies? Eg, suppose GBPUSD, does the UK100, US2000 or US500's current position suggest anything about the currency? like UK100 is rising thus more foreigners may want in on it and thus push up the GBP component of GBPUSD?
HMSR
  • #812
  • Sep 28, 2017 9:23am Sep 28, 2017 9:23am
Hmsr, just be careful of which criterias you want to add to the existing strategy ... some of them might scrap more winning trades of the strategy so the ending Win-Rate is lower ... backtest them throughly ...
Market is not random but unpredictable
  • #813
  • Edited 2:37pm Sep 28, 2017 2:05pm | Edited 2:37pm
Quoting Hmsr
I have been working on a strategy which involves straddling specific candles if their ranges are within a certain size
.......
Is there anything I can do to save this strategy?
Firstly, I'm a programmer, not a pro trader.

Secondly, over the years I've become more of a 'discretionary' trader, i.e. I believe that having a knowledge and experience about how prices move, and why, is preferable to blindly employing mechanical 'systems'. Hence I'm probably not the best person to ask.

Thirdly, you're asking questions about a strategy that I haven't studied or tested myself. Hence I can't give specific answers.

But you've asked for my opinion, so I will give it.

Even an expert analyst can't predict exactly how markets will behave in the future (the 'experts' on CNBC make wrong predictions around 50% of the time!). IMHO there's a lot of wisdom in this post ([EDIT] also here), especially where the writer says that strategies that worked profitably several years ago don't work today; hence we can assume that strategies that work well now won't necessarily continue to be as effective in future years. Belief systems, economies, political/economic relationships between countries, technology etc etc all change gradually over time, necessitating that quantitative strategies be retested and revised continuously. It follows that backtesting has limitations, but obviously it is better than nothing, and there are measures you can use to increase robustness and reduce 'curve fitting'. Forward testing has similar limitations, in that today's data likewise becomes increasingly obsolete as time progresses.

This post gives a lot of insight into how 'discretionary' institutional traders tend to think and operate. I will let it speak for itself.

If you are going to be more quantitative/mechanical in your approach, you could perhaps look at your strategy to see how robust the concept (straddling candles of your chosen timeframe) is, and possibly break down your data to look for patterns. Does it work significantly better at certain times of the day, certain days of the week, during certain months of the year, during certain identifiable market conditions? What are its strengths and weaknesses? Under what market conditions does it perform best, and worst, and what economic or geopolitical climates cause these conditions? Is there a relationship between these conditions and long term economic cycles? If the concept itself is robust (does it work equally well on other currency pairs? other markets?), is it merely a matter of adjusting certain parameters as volatility grows or shrinks? If volatility is an issue, is it possible to look at trends in indicators like ADR, to help assess probable imminent changes in volatility? And so on.

Hence perhaps it is not so much about "saving" your strategy, but having it operate within the framework of a 'master' strategy that varies the parameters according to the current state of the market. But you would need to experiment with this idea yourself.

I believe that these are the types of questions system developers should be asking. However, Daniel Fernandez is much more experienced in developing quantitative systems than I am. You might find some interesting ideas in his blog.

Finally, you don't talk about your exits. As 4for4 points out, experimenting with SL/TP/trade management might be a better way of adjusting for volatility changes, rather than varying your entries.

Sorry I can't be more help.
  • #814
  • Sep 28, 2017 9:53pm Sep 28, 2017 9:53pm
Quoting hanover
{quote} Firstly, I'm a programmer, not a pro trader. Secondly, over the years I've become more of a 'discretionary' trader, i.e. I believe that having a knowledge and experience about how prices move, and why, is preferable to blindly employing mechanical 'systems'. Hence I'm probably not the best person to ask. Thirdly, you're asking questions about a strategy that I haven't studied or tested myself. Hence I can't give specific answers. But you've asked for my opinion, so I will give it. Even an expert analyst can't predict exactly how...

Thanks for the response, I will indulge myself into this information and links you provided, & hopefully put in the work into myself, rather then statistical edges or linear strategies, or by chance create a strategy that considers market context with the potential of creating a timeless strategy, haha.

from the blog:
"Everything eventually fails, everything. When you begin trading and find something that works pretty consistently you feel like you have the entire problem solved. Through the first half of the last 10 years I developed around 4 systems that performed with amazing consistency for 3-5 years and then, they all failed, almost at the same time. Having systems that have been performing so well suddenly start to get into drawdowns far more prominent than anything within your historical tests – even your Monte Carlo simulations – is a pretty discouraging experience."

Very insightful response.
-Regards
HMSR
  • #815
  • Oct 1, 2017 8:52pm Oct 1, 2017 8:52pm
Hello Hanover,

Another small question, is there anyway through looking at price charts to spot 'uncertainty in the market', eg, Doji Candlesticks.

Also are there any other ways to spot real time uncertainty through external sources?
HMSR
  • #816
  • Oct 1, 2017 11:43pm Oct 1, 2017 11:43pm
Quoting Hmsr
is there anyway through looking at price charts to spot 'uncertainty in the market', eg, Doji Candlesticks. Also are there any other ways to spot real time uncertainty through external sources?
Depends what you mean by 'uncertainty in the market'.

When the market is in the mood to 'buy' risk, equities tend to rise, possibly at the expense of gold; while money flows away from safe haven currencies like JPY to the higher yield currencies (e.g. AUD, NZD).

Conversely, fear and uncertainty cause markets to become risk averse: equities tend to fall, and money flows toward safety like gold and JPY.

However, if by 'uncertainty', you mean that it's uncertain whether a given instrument/pair will rise or fall, then one pattern I would look for is declining volume within a move toward/into a prior S/D zone, followed by absorption type candles (e.g. an uptrend, followed by conspicuous upper wicks into a prior supply zone, could mean that the buying is close to exhaustion). This generally works well for me on M15, but is potentially applicable to all TFs. A subsequent north side breakout from supply does not necessarily mean that price will continue higher; it could be that professional money will use the amateur buy orders for liquidity for their subsequent selling, pushing price downward (this appears as a fakeout). All of this is explained further, including price chart diagrams, in this post.

A doji (or any candle with long wick(s)) highlights an unresolved battle between buyers and sellers, from which you must wait for subsequent candles to determine subsequent pressure/direction. Rising or declining volume, and also the location of the doji relative to prior candles (e.g. is it following a lengthy move, or is it during consolidation?), can give further clues.
  • #817
  • Oct 2, 2017 12:34am Oct 2, 2017 12:34am
Yes, any "uncertainty" signal (such as a harami or ranging market) must be looked upon the larger context of the market, not in isolation ...
An "uncertainty" signal formed near the top/bottom of a trend could indicate a reversal. But if it's formed in the middle of a trend, it might just be a "pause" before continuing. The problem is we couldn't have known if the market is still in the middle of a trend or nearing a top/bottom when it happened ... My suggestion is to wait a bit longer until there's a "trigger" before acting ...
Never get ahead of the market by assuming something "should" happen ... Trade what we see, not what we think ...
Market is not random but unpredictable
  • #818
  • Oct 2, 2017 12:48am Oct 2, 2017 12:48am
First time I looked at this thread. Hanover at his best again. Thanks and
Regards
  • #819
  • Oct 2, 2017 8:58am Oct 2, 2017 8:58am
Quoting hanover
{quote} I would look for is declining volume within a move toward/into a prior S/D zone
I am starting to see legitimacy in this where the lowest volumes create local Support/Ressistance kind of zones, thankyou for your responses, I appreciate the time.

I'm being wishful here, but is there a way to predict how much volume a currency may experience in the immediate future / next day?
I would think this is where close attention to news & live feeds may be of relevance.

I'm thinking of testing a straddle/SR zone, where the filter depends on uncertainty of the kind that is slow and unmoving, in order to execute a trade. Another filter might be an earlier estimate of a higher volume that day in order to estimate whether there is enough volume for a significant move to occur.

^Imagine that, I reckon perfecting all the above would lead to a timeless trading strategy.

-Regards
HMSR
  • #820
  • Oct 3, 2017 10:31am Oct 3, 2017 10:31am
Quoting Hmsr
I am starting to see legitimacy in this where the lowest volumes create local Support/Ressistance kind of zones.......
First, keep in mind that if you're using MT4, all volume data is tick volume (i.e. each transaction shows as 1 unit regardless of whether 0.01 lots or 100 lots was bought or sold) and applies only to transactions processed through your br0ker. Spot FX is a decentralized market, i.e. it's not possible to see volumes transacted across the entire market.

Also keep in mind that news events can have big effect on volumes, e.g. if comparing Friday to Friday, then this Friday's volume might be larger because of (say) NFP.

I don't know if volume can be used predictively in the way that you're describing; you would need to conduct your own research.

When you say "enough volume for a move to occur", don't forget that volumes are constantly changing as major players add or remove orders from the market. If I may oversimplify for the sake of brevity, there is "enough volume" for a buy move of 1 tick if the volume of upcoming market buy orders exceeds the sell limit orders at the current level.
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