FREE Double Top/Bottom Indicator - Very Good Edge

I assume you mean the "Automated Stop-Hunting System". I have planned to release it in the second week of January. Cheers

Hi Matty! Please download a fresh copy of the indicator and test the new copy. If the new copy also doesn't work then the problem must be something on your side.

One reason could be: Do you have a firewall running, which could block outgoing traffic? Please deactivate the firewall then try again and tell me if that worked.

Cheers

Thanks! I'm learning. Caught quite a few pips on that - demo at this time.

A trend continuation double top this morning on GBPAUD M5 got a 4R winning signal:



Detected by the FREE Double Top/Bottom Indicator

Yesterday's double top on EURUSD could have been traded as a 5R winner.

Reason: The rising trend line was already broken in the moment of the double top signal. After a trend line is broken the price usually pulls back to the trend line again and gets rejected there. You could have entered in the red rectangle.

Quoting FX-Mike

Disliked

Hi Scotty, thank you for your input regarding your EA and I wish you great success with it. But I want to make clear that I don't advocate using these double top/bottom signals blindly in an ExpertAdvisor. Beginning from my fist posts within this thread I advocate visual filtering of the signals to select the best ones. I have written too many completely automated EAs. I don't do that anymore because EAs can't recognize the bigger picture. The human brain can do that. I trade some of my systems with EAs. But I use EAs always only as an executor...

Ignored

I agree 100% that the initiation of a trade sequence can start with an alert and commence after a visual confirmation, I do believe an EA can be created to capture the most pips based on your system. I am not a programmer, otherwise I would do it myself. So here is my logic for your system if you want to create an EA. I think it would be beneficial to many and profitable for you.



EA Logic:

I do not know if you can call or add the Fibonacci indicator to create price levels automatically, but assuming you cannot…

Add BUY and SELL buttons along with your indicator to an EA. If you do not want to add buttons, the EA could monitor the chart for an order being placed manually.

Variables
Lot size
If BUY button clicked, a LONG market order is placed
If SELL button is clicked, a SHORT market order is placed
SL: Price Level
BE: Price Level
R1, R2, R3, R4... to as many as you wish to enter: Price Levels

Functional Operation
1. Using your alerter indicator, we wait for a signal. When a signal received, we open the chart that would have the EA embedded. If we can visually confirm that we want to trade the signal…
2. We draw the Fib lines for as many levels as desired matching what is available in EA so we can see what price levels to enter
3. Enter the price levels into the appropriate user defined variables of the EA
4. Click the appropriate button of the direction we wish to go and enter trade.
5. When the price moves beyond R1, EA moves SL to BE
6. When the price moves beyond R2, EA moves SL to R1
7. When the price moves beyond R3, EA moves SL to R2
8. And on and on until close.
Some of these trades run for hours or days. And adding some automation could be useful and remove a little stress.

Just my thoughts. Best wishes!

So basically it would be a trailing stop EA. I'm personally not a friend of trailing stops and I have too much other work to do. But maybe someone can help you creating such an EA.

The EA would be easy enough to create including Fibo but i would not do this unless Mike was Ok with it.

Correct. A Trailing Stop EA that uses the R levels as steps. Just an idea.

And the user can always close a trade manually, but with the EA automatically setting and moving stops, they do not have to watch all the time unless they want to or have time to.

Hi Tim! Of course you can program your tool-set to trade the concepts of this thread. Whatever helps you is good. The only thing i don't want is blindly trading all signals fully automated.

If you want to use trailing stops for your trade handling then I can provide a trailing stop indicator which I programmed 5 years ago. This trailing stop is based on inside and outside bars. It can catch big moves, is sensible to price action and takes profits a little more aggressive than the simple 1R trailing stop.

Here are two screenshots:





With this indicator you could also do something like this:
- signal on H1 -> start with trailing stop based on H1
- after the trade is good in profit -> switch to e.g. M15 for a more aggressive exit while you still have the chance to catch a further big move

The following screenshot shows a double top counter trend signal.

And it shows why it's usually a bad idea to trade counter trend signals without a preceding climactic price move. Without a preceding climactic price move there is usually not much room for a big move and regarding the logic of the market maker cycle you can't expect that they need to reverse the trend.

The double top has only room for a 1R move until the next support area (the trend line):



The trend continuation double bottom signal has much better profit potential of nearly 4R because the trend channel gives more room for a move:



Don't trade each signal blindly. Trade the odds!

Free Double Top/Bottom Indicator

I was asked why the market maker usually doesn't need to reverse the trend without a preceding climactic price move. Good question Paul

And my answer is: because the market maker could most probably re-accumulate parts of the position, so that the trend is allowed to resume

The following screenshot shows the upward cycle from the view point of the market maker (the smart money). The market maker takes always the imbalance of the herd.

On the left side within the big green rectangle you see the downward trend where the herd was selling while the market maker was building the initial huge long position. The market maker reverses the price with a V (a pinbar on higher timeframes). The herd is now turning to bullish and starts buying. The market maker is selling to them with profits.

During the upward move you can see the profit taking areas of the smart money. New highs in an uptrend induce a lot of long traders from the herd. The market maker sells into that liquidity (small green rectangles). Long traders are placing their stops at recent lows (red horizontal lines). The smart money takes those stop level out to re-accumulate parts of the initial long position.

As long as the market maker can re-accumulate the long position the upward trend is allowed to resume. The images of the man with black suit represent the market maker. As you can see in the screenshot the cart of the market maker gets more and more empty during the upward move. Re-accumulations occur but the cart (the long position) can't be entirely filled again because the herd is bullish and throws more long orders into the market than short orders.

At any time during the upward trend the cart (the long position) of the market maker must get empty. We will never know for sure when this occurs because the market maker will never show us his order books

But we can play the odds! During a climactic upward price move (after a matured upward trend) the chances are good that the market maker made a transition from net long to net short. Because the smart money could not take out a recent low (and re-accumulate longs) during the climactic move. So a counter trend double top after a climactic move has a higher probability of success than counter trend double top without a preceding climactic move.

Hi Robin,

this indicator doesn't show target prices, only trailing stops. It can occur that the green and red line are drawn at the same time. But both lines are only trailing stops.

Hi Mike.Just subscribed to your very interesting thread and downloaded the freebies. Look forward to getting the paid ones soon for trading after xmas. Merry Xmas all

You're most welcome Pamc!

And Merry Christmas to all here on FF

Merry Christmas Mike!

Good morning!

Here is something to think about during the quite Christmas days

Is it worth to wait for a 50% pullback after an double top/bottom signal occurred?

Advantage: The winners will be 2 times (+1) bigger than the winners when you enter immediately
Disadvantage: The winning percentage will be lower because you will miss some winning trades



How are the results if you compare e.g. the last 50 signals when you enter immediately and when you wait for a 50% pullback?

Hi Mike, to contribute to the above question, I have one of my own. Is there a constant method you use to draw the fib indi to confirm your entries? In some images, you draw the indi between the 1 and 2, others it is above/below the line and 1 and 2. Having constant anchors help to determine probability and analysis of what a trade "might" have done.

I have been using the modified Fibonacci to draw from the line to above/below 1 and 2. Using price crossing the line as a confirmation of sorts. Would this be correct?