Analysis and Trading based on Envelopes, Waves, Cycles

Bonne lecture,

Dave It seems it gives positive results.

Conclusion : the Timing settings 256, 128, 64 , 32 work independently of the Price settings based on the Gann Octave - roughly the division by 8 of the Price Range.

Thanks for this example

IMHO Coding Envelopes for brilliant coders.

a) coding Envelopes for having to the pip Lows or Tops is good for the ego, intellectually and technically challenging but bordering inefficiency for Trading

b) strategically the aim of an Envelope is "enveloping" Price Action, meaning "most of Price Action" within Time frame X is included within the Envelope

c) then your first objective is to determine the settings which minimize touchings or crossings of the Upper and Lower Limits of the Envelope.

d) when you have determined these settings , you reduced them by let's say 10 % and every time Price Action crosses Envelopes limits conversely to the previous trend you have a very high probability Candidate Reversal Signal

Quoting LongBTC
{quote} When I mentioned crazy mathematics I was actually referring to the numerous documents you posted and the parameters behind all the bands. While I absolutely understand that there is no doubt that you will find value in these indicators I think that we can keep things much simpler and that trading from (almost) naked price action can be profitable too.

Crazy mathematics

Crazy Typo : Gann Octave = 0.0065

Dave, very Lazy Traders like me use Fixed Width Envelopes !

Bollinger on Hurst’s Envelopes

The next major development came in 1970 when J. M. Hurst published The Profit Magic of Stock Transaction Timing.

Hurst’s interest was in cycles,and he used ‘‘constant width curvilinear channels’’ to clarify the cyclic patterns in stocks. His approach was to use multiple hand-drawn envelopes (see Figure 6.6) that related to the various cyclic components of price action.

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The envelopes nested inside one another,often becoming congruent at major turning points. In the back of his book,he gave some broad hints at how this process might be mechanized (see Figure 6.7) but the examples presented in the text appear to be hand-drawn.

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We suspect that the concepts were beyond the technology then commonly available. In the years since,numerous attempts have been made to systematize Hurst’s work,but we are not aware of any successful results.

The development path of trading bands gets a bit murky here, and credit is hard to assign. In the next phase,inter est seems to have broadened,and several analysts appear to have been working on similar ideas at the same time. The main technique employed in this phase was to shift a moving average in a parallel manner up and down to form bands around price (Figure 6.8).

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The offset was typically a number of points or a percentage of the average.

See,for example,Table 6.2. Hurst had clearly favored the use of moving averages in his book,but we think the idea of shifting the averages by some mechanical means came later, perhaps in the early 1970s. The problems of this approach became apparent immediately.

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First,the width had to be determined empirically on an issue-by-issue basis.

Second,even having done that, the widths needed adjustment over time. Thus, while percentage or point bands did provide useful definitions of high and low for traders, they were hard to use and involved considerable guesswork on the part of the user.

Did you reach that decision by means of an automated process or a discretionary one ?

Parisboy, I would like reach out to you. Couldn't find the link to send you a DM. I would like to share some stats with you. Can you please contact me somehow

AUDJPY 5 minutes 5 Days

AUDJPY 15 minutes

AUDJPY 30 minutes 1 Month

AUDJPY 60 minutes 3 Months

After 40.000 hours + of Screen Studies and Analyzes !

Hello Parisboy,

It now appears some are starting to see the significance of what you have been trying to share with your envelopes. I have the 256, 128 & 32 set on a couple of charts using MT4 charts which have some limitations as compared to Tradingview, but can see the benefits of using the envelopes even on MT4 charts. What I have on my charts is in no way comparable to what you show on yours. It seems OAPDave has his set correctly using MT4 charts. My core trading does not consist of using envelopes, but out of much interest I decided to put the envelopes to use. The results are outstanding. I have long had an interest in Hurst & Murrey Math. Did you ever purchase the J.M. Hurst works that was for sale several years ago? It was a large collection of his works that was being sold by a company in South Caroline USA if my memory serves me correctly. Having senior moments at times. Had a conversation with the seller, but could never justify the price tags.
Would appreciate your views on Murrey Math & a comparison to Hurst & envelopes. You certainly have NO PEERS when it come to trading the envelopes. Indicators are not really needed, but I can see the merits in some custom coded ones. I have a couple, but there are NO holy grails among them. Envelope, vtl & much practice is all one needs. Thank you for your time to respond. Responding after the market close will be just fine. I remember your post in that thread where you reminded everyone it cost you money to stop to respond to the LAZY TRADERS. So true. There are many lazy ones among us, ME included at times. Btw, I do enjoy reading your thread. Most informative. Also your comedy on that other thread whether intended or not is outstanding. Spot on. Now that I've lost 40 pips typing this I'm out.

Best trades to you.

on this thread no problem

We should better chat if possible? But it's okay if you don't prefer that