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LFX Trading Proverbs

  • #401
  • Feb 4, 2019 6:35am Feb 4, 2019 6:35am
Quoting David0
{quote} Thank you Dkrock for stepping in to reply. I will try different settings with the attached indicator as soon as I return from work by Gods grace. I'll let you know what I find out and where I find difficulties. I'll probably upload a chart if need be so you can understand me better. Thank you DK
The thing to remember is that a time frame is just a time frame. They all draw the same patterns. They differ in range from high to low and in the frequency of the ranges. So once you decide what MA you want to use, you reproduce it on other time frames and compare the signals to find high probability trades. By further using a good oscillating indicator, you can introduce slowing, which helps limit MA chart head fakes. When it all agrees, you normally have a profitable trade. That is how you can use "mathematical" probability, or the average of averages, to increase your odds of winning trades. I recommend developing your MA template on a 30M chart and then modify it to fit your preferred time frame(s). Black out your candles and review your signals on historical charts. Add the color back to the candles and analyze your results for accuracy. Your goal is to beat the spread or at least break-even. Money is more easily made from risk than from pips. Not losing allows you to increase risk, so look for consistency, not precision. Good Luck.
You cannot be extraordinary by being normal
  • #402
  • Feb 11, 2019 4:23am Feb 11, 2019 4:23am
Dk, I hope your doing well. Please could you kindly explain the below statement of your in brackets, probably with a chart if possible. You can use any pair and time frame as I am aware you are also guiding your business secret. That statement of your is messing my head up, Loll. I'm really particular about knowing how to find the high and low of time period. You even mentioned it again in a reply you sent to me recently.

By time period, are you referring to time zone or time frame or numbers of a particular candles or what?? could you please explain with a chart???

When you say experiment with a moving average, are you referring to the moving average of the high and low you discovered??

And why is it that no body ever has an idea of some of the things you post or say??? Lol.
I sent a message to you some days ago( a gentle reminder).
Here is the statment I'm referring to
(For instance, if you use a CCI set to 14, then find the highs and lows of your time period and experiment with a moving average that the CCI will cross after the high or low is reached. Usually it is a factor of the period setting. So, if you use 14, then sample SMAs of 7, 14, 28, 42. When you find the MA that provides the most consistency, then remove it from your chart. Add the Bollinger band that matches your choice. Then attach the MA again with a different color.)
Market moves up or down
  • #403
  • Edited 8:05pm Feb 11, 2019 4:49am | Edited 8:05pm
Hi Dk, I hope your doing well. Please could you kindly explain the below statement of your in brackets, probably with a chart if possible. You can use any pair and time frame as I am aware you are also guiding your business secret. That statement of your is messing my head up, Loll. I'm really particular about knowing how to find the high and low of time period. You even mentioned it again in a reply you sent to me recently.

I find the highs and lows from changes in momentum between various time frames. When one time frame starts to quiver the other way, I compare it to another to determine if it is really turning or not. This allows me to exit and sit and wait for the second time frame to concur, ride it out because I don't think it is really turning, or exit and immediately enter the other way. It depends on how the apex is measured and defined with my indicators.

By time period, are you referring to time zone or time frame or numbers of a particular candles or what?? could you please explain with a chart???

I mean the time frame you want to trade. That will depend on your personal time, your personal goals, and your personal abilities.

When you say experiment with a moving average, are you referring to the moving average of the high and low you discovered??

There are many moving average experiments. The problem with trading is that while you can control the sample size, you cannot control the data within it. Each trade is a unique event, which is why price action and support/resistance traders typically lose most of their trades. Without averages, you cannot create a probability. There is no average in a candle shape or a line touch, so you have no data to predict future movement. It is a guess every time. Consider how a casino knows the odds of you winning or losing. It is from an average of events. So, if you are not measuring the averages of trading events, you are in a lot of trouble. By its very definition, your goal is to find the average. It does not have to be perfect. In fact, it cannot be. Once you have an average that is general enough in nature to normally show the distribution of trades, then you can use it to create a mean reversion via an oscillating indicator. That will normally show you the apex of price, or the high and low. To increase your consistency, you target an area just past each high and low so you are not involved in the consolidation and head fakes that can occur at the highs and lows. Those areas are designed to steal the money from the support/resistance traders by making them second guess their entries and whipsaw price as much as possible to make them panic and make mistakes. When you trade mean reversion, none of that manipulation affects you.

The point about putting on Bollinger bands first is due to the way the software works. If you want the bband to be against your signal line, then all the moving averages have to be off the indicator when you attach it. Otherwise, it might attach to a moving average, rather than your signal line. Just an oddity to be aware of.
You cannot be extraordinary by being normal
  • #404
  • Feb 15, 2019 1:06pm Feb 15, 2019 1:06pm
Hi Dk, hope your doing well. sent details to your mail.
Attached Image(s) (click to enlarge)
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Market moves up or down
  • #405
  • Feb 16, 2019 2:43am Feb 16, 2019 2:43am
Quoting dkrock
Trigonometry defines the pattern you want to measure; the cosecant of the trade. Probability defines the data points that are most responsible for creating the cosecant. Trigonometry shows you its high and low after the trade. Probability shows you its high and low during the trade. As long as your probability is inside your cosecant (upper and lower values), you have a winning trade, depending upon the cosecant being larger than the spread and there is no human error in opening/closing the trade. The probability exit is also the next probability...
Hi DK, I dreamt about probabilities last night, so i woke up and read your thread from the beginning making it the 4th time this year and something in page 15, post 297 caught my attention. I have been seeing it but never really understood it up until today. I have tried to replicate it on 30M TF using yesterdays chat.
I have attached 2 charts. I want to know if my idea of cosecant triangle is Valid/correct in your opinion or if i'm missing something. If it is valid, which of the charts please?? Thank you as always.
Attached Image(s) (click to enlarge)
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Click to Enlarge Name: cosececant.png Size: 97 KB
Market moves up or down
  • #406
  • Feb 23, 2019 6:29am Feb 23, 2019 6:29am
Creating the cosecant can only be done after-he-fact. I was trying to point out all the movement available between highs and lows. If you take parts every time, it is usually much easier than trying to guess highs and lows.

As for the design on your other charts, you have to create it to be logical to you, as well as provide consistent results. If it works for you, then it is correct. If not, then fix it. Remember what you see in history is not necessarily what you see in the live market. Everything "adjusts" as more data is displayed. It might take months or even years to finalize your signal, depending on your skill and time. If it was easy, everyone could do it. If you want it to work when you are finished, then you would be wise not to post your strategy on a world-wide public forum. Not only would millions of traders using your signals cause your entries and exits to slip, but any market makers having access would do their best to defeat it. Don't let the public into your gold mine. Good Luck.
You cannot be extraordinary by being normal
  • #407
  • Mar 4, 2019 4:00pm Mar 4, 2019 4:00pm
Hi dkrock, I find your way of looking at the market fascinating, to say the least. And it's all done with indicators? which flies in the face of all long-term wisdom. The fact that you've found a way to use them - kudos to you!
"When the facts change, I change my mind"
  • #408
  • Edited 12:47pm Mar 5, 2019 3:52am | Edited 12:47pm
Quoting amundo
Hi dkrock, I find your way of looking at the market fascinating, to say the least. And it's all done with indicators? which flies in the face of all long-term wisdom. The fact that you've found a way to use them - kudos to you!
It is just business analysis. Business analysis is about creating sample sizes and comparing the average of averages to make future predictions for growth/reduction, as well as tracking costs to determine pricing as it relates to production and manpower. Few people are trained in this field. Most people come from other backgrounds and really don't have any idea how to use these tools to trade, so they just do what they see on TV, movies, youtube, and forums. It is illogical since each new trade is a new event. Trading a new trade, based on the previous trade, is like choosing a roulette number from the history board, lol. It is fake. Trading on perceived news is another fast way to lose all your money, since no one knows the news until it is released, and no one knows how the market will respond to it. All guessing. I prefer to use math to measure the buyers and sellers, since their activity is what is making the market actually move. Good Luck.
You cannot be extraordinary by being normal
  • #409
  • Apr 25, 2019 10:23am Apr 25, 2019 10:23am
Attached Image
You cannot be extraordinary by being normal
  • #410
  • Edited Jun 11, 2019 12:03am Jun 10, 2019 8:13pm | Edited Jun 11, 2019 12:03am
I just read a post about having a written trading plan, and sure, it is a good idea. It is especially good when you are designing or testing your system so you can compare your rules against reality and make modifications. Ideally, there will come a time when you have finished creating your strategy and are mostly satisfied with its capability. By that point, you probably won't read your rules anymore as they are habit.

This is what I did and maybe you will find it helpful. First I took a screenshot of my complete system, using vertical lines to mark the most obvious entries/exits it identified. Then I start at the bottom and slowly remove pieces and take another screenshot. Eventually, all the indicators are gone and there is only the chart, with its indicators. I slowly remove them until all that is left is the vertical lines. I take screenshots of each removal step. Eventually, I remove the lines and all that is left are my candles.

I store all the photos in a folder, then open the folder and number them in reverse order. So, the first photo becomes the last photo in numbered order.

Next, I use a photo slideshow software and load the photos onto it. I choose some music that inspires me and count how many seconds the song lasts. I divide the number of photos by the seconds and set the slider to change the photos according to that number. Then I add the song and save it as an mp4 movie.

Ideally, you want to look for a sample that contains several different market patterns. For instance, my movie has a low range trade, followed by a normal range trade, followed by a bit of a stair step pattern, followed by a double reversal, followed by a steep reverse, followed by consolidation, followed by a long, slow moving trend. I can see all the interaction between the various patterns and familiarize myself with my system's capabilities in less than 4 minutes, all while jamming to an inspirational song. For me, the visual representation of how the trades are marked is more powerful, more fun, faster, and easier, than reading a list of rules.
You cannot be extraordinary by being normal
  • #411
  • Jul 7, 2019 3:43am Jul 7, 2019 3:43am
Quoting dkrock
I just read a post about having a written trading plan, and sure, it is a good idea. It is especially good when you are designing or testing your system so you can compare your rules against reality and make modifications. Ideally, there will come a time when you have finished creating your strategy and are mostly satisfied with its capability. By that point, you probably won't read your rules anymore as they are habit. This is what I did and maybe you will find it helpful. First I took a screenshot of my complete system, using vertical lines to...
Will appreciate if you would provide a link to your movie or upload it here. Thanks.
Practice makes a person perfect
  • #412
  • Jul 11, 2019 10:14pm Jul 11, 2019 10:14pm
Quoting simnz
{quote} Will appreciate if you would provide a link to your movie or upload it here. Thanks.
There might be copyright issues with the audio portion and definitely issues with the video portion. I just did it for personal use to prepare me for seeing the trading signals, and to inspire me to make the money. I assume each video would be personal to each person. Good Luck.
You cannot be extraordinary by being normal
  • #413
  • Jul 13, 2019 6:46am Jul 13, 2019 6:46am
Quoting dkrock
I just read a post about having a written trading plan, and sure, it is a good idea. It is especially good when you are designing or testing your system so you can compare your rules against reality and make modifications. Ideally, there will come a time when you have finished creating your strategy and are mostly satisfied with its capability. By that point, you probably won't read your rules anymore as they are habit. This is what I did and maybe you will find it helpful. First I took a screenshot of my complete system, using vertical lines to...
Have you read the inner game of tennis?
life is a reflection of what we allow ourselves to see
  • #414
  • Jul 14, 2019 9:14pm Jul 14, 2019 9:14pm
Quoting mikeeating
{quote} Have you read the inner game of tennis?
No.
You cannot be extraordinary by being normal
  • #415
  • Jul 31, 2019 11:02pm Jul 31, 2019 11:02pm
So you just have break-even trades or profitable trades? Literally no losing trades? You don’t use any stoploss right? I’ve read the first 10 pages and some clarification would be great.
  • #416
  • Aug 1, 2019 12:31am Aug 1, 2019 12:31am
Quoting nim1984
So you just have break-even trades or profitable trades? Literally no losing trades? You don’t use any stoploss right? I’ve read the first 10 pages and some clarification would be great.
The profit of a trade is always up to the movement of price. I cannot control the distance price moves between the entry and the exit. If the market does not move more than the spread, then I lose the spread, or a portion of it. If I am head faked, then I will likely lose some pips while I wait for the head fake to become apparent. What I rarely have is draw down because I target vertical movement. Inactivity that cannot surpass the spread is not a draw down issue. A very small loss due to a head fake change in direction is not a draw down loss. For both of these situations I would call that a consolidation issue, which infers that the only losses I have occur in consolidation zones, though I often can identify them and prevent the loss, or ride them out and prevent the loss. It depends on the second time frame. If both time frames are in a small range, or consolidation, then it really converts trading to gambling, or waiting until the consolidation ends, which is typically what I prefer to do. I was fortunate to notice early in my trading career that consolidation zones were a major issue for me, so I used that knowledge in the development of my template and found ways to overcome those areas. As for head fakes, they are also normally visible, which leaves me a choice of taking profit, or riding them out, which varies depending on what my profit is when the head fake occurs. Sometimes I exit for profit, while other times I am so deep in profit that I ride it out. The order flow also plays a role in that decision. If the market is lopsided, and a head fake occurs, then I will likely ignore it and ride it out. It also depends on how it signals on my template. If it seems legitimate by the signal, but not by the order flow, or there is a mismatch between time frames, then I normally exit and use that as an excuse to eat, lol, because it often means a consolidation period has formed, so I sit out and wait until it finishes and price continues back to the original direction. While most traders might ride these conditions out because they try to trend trade, I am a range trader, so I normally exit. If my time frames disagree, then I am no longer in the sweet spot and have no reason to continue to risk my money. As for stop loss, I always use a stop loss, or more accurately, I prefer to trail the stop loss. When I am trading multiple pairs at once and see the next entry, it saves me time if the exit(s) is/are automatically taken.

It sounds robotic enough, however, due to consolidation zones, head fakes, and news spikes, I have to manually trade. I hope that clarifies your concerns.
You cannot be extraordinary by being normal
  • #417
  • Oct 7, 2019 7:19pm Oct 7, 2019 7:19pm
Proverb #13. Since 75-95% of traders lose their trades, and it only theoretically takes one person's mistake to screw up your trade, you should not expect to win every trade. Have a plan for losing trades and use it.
You cannot be extraordinary by being normal
  • #418
  • Oct 7, 2019 7:31pm Oct 7, 2019 7:31pm
If your life was a book, and you were the author of the book, how would you want your story to go?

Inserted Video
You cannot be extraordinary by being normal
  • #419
  • Oct 8, 2019 5:01am Oct 8, 2019 5:01am
Proverb #14. This one is a quote, but so important for setting goals. If you think you can or think you cannot, you are correct. "No more effort is required to aim high in life, to demand abundance and prosperity, than is required to accept misery and poverty." — Napoleon Hill
You cannot be extraordinary by being normal
  • #420
  • Oct 9, 2019 6:54am Oct 9, 2019 6:54am
Quoting dkrock
Proverb #13. Since 75-95% of traders lose their trades, and it only theoretically takes one person's mistake to screw up your trade, you should not expect to win every trade. Have a plan for losing trades and use it.
Hi DKROCK, please can you talk more on this, especially the use it part. Thank you
Market moves up or down
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