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"Ratios & Harmonics: a Different Way to Trade." Summary 37 replies

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Ratios & Harmonics: a Different Way to Trade

  • #49,181
  • Feb 25, 2020 2:16pm Feb 25, 2020 2:16pm
Quoting bmdenton23
{quote} I don't really want a debate but I do feel compelled to make sure that your statement: "it's time for him to put the ego aside and admit that he needs to make some changes to his daytrading strategy cause it simply doesn't work in the current markets anymore" is at least challenged so that new traders who stumble across this thread aren't scared off by such statements. Since the start of 2018, if you traded every swing that was at least 40 points and less than 200 points, entering on a 42% pullback, exiting at the one to one or 1.27% extension,...
All I can say to you is that your posts are entertaining at best and misleading at worst.

"at least 40 points and less than 200 points, entering on a 42% pullback,"

That just shows your bot doesn't follow the rules laid out by Damian and what he kept saying over and over again in his videos and posts here. In addition to that he doesn't trade 24/7 like a bot but from the open to noon, sometimes a bit longer.

I've learned a lot from Damian about trading, but also things that can be applied to many different situations in life, so for that I am grateful. Again I was mostly speculating with my previous post, which is why I would like for him to come back and address a few things himself. I understand that he doesn't owe anything to anyone here but I think everyone who's followed this thread for years and put in hours of work during that time would appreciate it.

PS: Seems like everyone saying they are profitable daytrading with Damian's strategy have made changes to it.
  • #49,182
  • Feb 25, 2020 2:35pm Feb 25, 2020 2:35pm
Quoting bmdenton23
{quote} Since the start of 2018, if you traded every swing that was at least 40 points and less than 200 points, entering on a 42% pullback, exiting at the one to one or 1.27% extension, moving to BE at the 100%{image}
... and if this and that. Also nobody knows what you have coded there to display that statistics.
Its 100% hypothetical, as Ebenol said. If one assumes you coded it correctly.
In my opinion its worth nothing to show such "stats" because of the reasons explained above.


Quoting bmdenton23
{quote} new traders who stumble across this thread aren't scared off by such statements. {image}
Probably more scared off by statements made by the thread owner having his following results and disappearance in mind instead of people's opinions.

"Stay tuned I will be making huge investment for all of you"

"I have a vision but I do want to please you as well! So what would you all like the channel to have? It will be real, immersive, interactive, and unlike anything else!
I'm building this for you. It will be our legacy for tomorrow for today and tomorrow's Traders. Lets cause some ripples, NO! Screw that, lets cause some tidal waves.
to let you know there is much much more to come and to motivate and excite you all"

"The channel has already begun it's transformation. This just the beginning. I will become your trading copilot. As an avid aviator I felt it appropriate to dub myself as your Trading Copilot. What do you all think?"

"I'm so excited for you all and for the channel. I can't wait to get cranking on the content. Visit the channel like and subscribe. The channel will be an extension of this forum and completely free. I do not sell a thing. I offer you my thought my experience and a heartfelt commitment to your success. Lets get busy and spread the word my friends. Let's crush this and in the process kick some snake oil sales people in the balls!
Let’s keep digging together and start making things happen. Who is on board?"

"It's time to get serious about trading and your transition into the top 10%. It's time to step it up! It's time to get it done"

"The excuses stop and it's time to get going again and see it through. The Trading Copilot is on FB, Insta, Twitter and Youtube. The resources will be better and bigger than anything else. I have a vision to provide you with live trading, Interviews of market professions of all markets not just Futures or FX but others to include Crypto and much much more. All of my guess will me market professionals that walk the walk for you all to see and hear how other market professionals do their thing and consistently crush the markets."

"The only thing I ask is that you put in the effort and also share and like everything. I want this to be the biggest and best place to come to for growth and development. Tell the world! The Trading Copilot is the place to be."

Dust in the wind.
  • #49,183
  • Feb 25, 2020 2:37pm Feb 25, 2020 2:37pm
Quoting Kayjay2011
{quote} All I can say to you is that your posts are entertaining at best and misleading at worst. "at least 40 points and less than 200 points, entering on a 42% pullback," That just shows your bot doesn't follow the rules laid out by Damian and what he kept saying over and over again in his videos and posts here. In addition to that he doesn't trade 24/7 like a bot but from the open to noon, sometimes a bit longer. I've learned a lot from Damian about trading, but also things that can be applied to many different situations in life, so for that...
bmdenton has posted stats of the "bot" with the settings set to the first 2-3 hours of the session..and guess what ..it was still profitable ...SHOCKER !!!
The 40/200 setting is to remove very immediate OF and those huge swings that don't even make it to the 38.2 correction...and lets face it, when this happens Damian does requalify the orderflow.
Don't disregard the results just because you don't understand the principle behind the "bot" or properly called algorithm.
  • #49,184
  • Feb 25, 2020 2:41pm Feb 25, 2020 2:41pm
Guys I don't trade Damian's method and I wasn't even profitable with it and here I am defending the system...so instead of shitting on the system maybe look inward.
When I don't like a song I just don't listen to it...I don't sit there and complain and talk shit about it. You're like those haters on youtube videos... complaining and talking badly but not providing anything of value.
  • #49,185
  • Feb 25, 2020 2:48pm Feb 25, 2020 2:48pm
In all honesty, his disappearance only solidifies his standing in trading in my eyes. If I was him and was trying to help people learn an extremely valuable skill with 3 little kids at the house and the people I was trying to teach became ungrateful and disrespectful, I would leave too. He's provided some excellent value here and in reality, anyone can take it and start turning a profit. Yeah he had some hard trading times before his time off, but he doesn't owe anyone here anything. Someone mentioned that he was helping with family, and that could very well be what he is doing. It's nice that he has given such valuable material and is trying to help everyone out, but if something is going on with his family, then that comes first.

He can't make a single person a profitable trader. Do the damn work yourself, revisit what he has already provided, and become a profitable trader, or don't.
  • #49,186
  • Feb 25, 2020 2:48pm Feb 25, 2020 2:48pm
Quoting x3m-PippiN
{quote} bmdenton has posted stats of the "bot" with the settings set to the first 2-3 hours of the session..and guess what ..it was still profitable ...SHOCKER !!! The 40/200 setting is to remove very immediate OF and those huge swings that don't even make it to the 38.2 correction...and lets face it, when this happens Damian does requalify the orderflow. Don't disregard the results just because you don't understand the principle behind the "bot" or properly called algorithm.
Hey smartass, I've written my own algos in the past. It's nothing fancy and the results don't prove much as you probably already know. If you read my posts properly you would have realised I'm not attacking the system but I'm merely disappointed by the dishonesty that's been taking place.
Good day.
  • #49,187
  • Feb 25, 2020 3:09pm Feb 25, 2020 3:09pm
Quoting Kayjay2011
{quote} Hey smartass, I've written my own algos in the past. It's nothing fancy and the results don't prove much as you probably already know. If you read my posts properly you would have realised I'm not attacking the system but I'm merely disappointed by the dishonesty that's been taking place. Good day.
What dishonesty do you speak of? Damian's disappearance?
Wow! I've got some experience to gain.
  • #49,188
  • Feb 25, 2020 3:43pm Feb 25, 2020 3:43pm
Quoting Hansl
{quote} ... and if this and that. Also nobody knows what you have coded there to display that statistics. Its 100% hypothetical, as Ebenol said. If one assumes you coded it correctly.
@Hansl - you are correct in saying nobody knows what I've coded, perfectly fine to be extremely cautious. I don't ever believe posted backtest results online either. I do believe in them when I code them though

Quoting Hansl
{quote} ... its worth nothing to show such "stats"
I disagree. I believe "real / un-doctored" automated backtest results are the most reliable way to show a potential "Trading System" shopper the value a system potentially has in the future. An algo removes the discretion, the ego, the emotion, it's just numbers.

Quoting Kayjay2011
{quote} All I can say to you is that your posts are entertaining at best and misleading at worst. "at least 40 points and less than 200 points, entering on a 42% pullback," That just shows your bot doesn't follow the rules laid out by Damian
@Kayjay2011 you took issue with the 40, 200, 42% so I hope you'll give me the opportunity to explain the necessity of each.

Minimum Swing length of 40 and a Maximum of 200.
First, there has to be a min / max. From a technical perspective, almost every 144T candle could itself be a swing. It projects, retraces, projects some more, but obviously I'm not going to trade "inter-candle". One might argue, why not 15 point swings? The problem with trading such a small swing is that the 1 point spread + commission becomes such a large percentage of your target it's not worth trading. Even if you nail the entry and exit, the spread + commission eats up 12% of the profit so there must be a minimum that balances the expectancy and the fees.
Minimum 40 point swings provide that balance for me. On the other side I have to define a maximum that fits my risk tolerance, so 200 pt max swing size.

42% Retracement
The goal here is to show the results of entering every swing that qualified to be a swing. According to Damian's rules any projection that pulls back to the .382 qualifies the previous projection as a swing. I should've showed results from entries that pulled back to .382. Had I included rotation logic for entry, or any other entry logic, many swings would've been skipped. Again the goal is to trade every swing, not to filter. Otherwise we detract from the premise of the system.

Quoting Kayjay2011
{quote} PS: Seems like everyone saying they are profitable daytrading with Damian's strategy have made changes to it.
I have certainly made changes to it. The results I posted were the results of an algo trading the system according to Damian's rules coded to the best of my ability. It is not however the optimized version according to backtest results. I trade the optimized version manually on my account.
  • #49,189
  • Feb 25, 2020 7:44pm Feb 25, 2020 7:44pm
Quoting appletrader
{quote} yeah i don't follow any of these rules when i trade patterns but also trade them in a very different way. thinking of starting my own thread to show how but certainly not every pattern is the same but there are some good ways to qualify them. anyone interested in a new pattern thread we can manage to show some different approaches?
You might enjoy CNTrader's thread. I have learned a lot from that thread as well. And that thread is purely harmonic patterns and structure. Mr. Pip even praised CNTrader on his thread and invited CNTrader to comment on this thread.

So, there are two great traders that you can learn from.
Luck has no place in trading. Leave that for the poker table.
  • #49,190
  • Edited 9:02pm Feb 25, 2020 8:28pm | Edited 9:02pm
This is a trade that I took from last night (my time, here in asia).

Not all of them are like this. I had preset a 20 point stop loss.
I set a limit order for 27628. Price came down and activated my limit order.
I knew that this was a counter trend trade considering the current market conditions.

There was one very bad thing about this trade though, Ninjatrader defaults to simulation mode when it is first logged into.

So, after my trade, I realized that it was still in simulation.

So, no gain and no loss. And it was my second day in a row to have this type of entry under the current market conditions.

Now, I don't know how to use DOM or Some of those VWAP, Ladder, etc.

However, like Mr.Pip, I do realize that price structure is the king. I am not so great at harmonics either. Mr. Pip mainly focuses on the ABCD completion. I do like how he teaches to project price forward and to have an expectation. Nevertheless, in my humble opinion, a trader must understand how PA creates structure in order to have an expectation.

Anyways..what do I know, right? After all, I am just a trader that speculates what the market will do for profit/loss just like any other trader.

Oh, and On Monday my time, I set a limit order for 28005. I will also posted this chart as well.

But hey... who cares about my TA as someone on this thread mentioned. ha ha ha
Attached Image(s) (click to enlarge)
Click to Enlarge Name: MYM 03-20 (14 Tick).png Size: 45 KB
Click to Enlarge Name: MYM_03-20_14_Tick Monday.png Size: 40 KB
Luck has no place in trading. Leave that for the poker table.
  • #49,191
  • Feb 26, 2020 12:27am Feb 26, 2020 12:27am
Quoting bmdenton23
{quote} I don't really want a debate but I do feel compelled to make sure that your statement: "it's time for him to put the ego aside and admit that he needs to make some changes to his daytrading strategy cause it simply doesn't work in the current markets anymore" is at least challenged so that new traders who stumble across this thread aren't scared off by such statements. Since the start of 2018, if you traded every swing that was at least 40 points and less than 200 points, entering on a 42% pullback, exiting at the one to one or 1.27% extension,...
I agree with you...there is also the fact that the money management was very agressive and no possibility to split positions which was very restrictive. Nevertheless, I think that why he left and decided to focus 100% on his trading is dissapointing number of his folowers on Youtube which is also a riddle to me. It is almost impossible to find such a quality trading content as Damian provided. Especialy for newbies . Very refreshing and it is a pitty that everything on this planet evolves around the $$$$ i.e. the number of followers. I can understand his dissapointment and from this point of view his risk reward was not worth stealing his time away from his family and trading...... such a shame!
PVSRA
  • #49,192
  • Feb 26, 2020 4:33am Feb 26, 2020 4:33am
Quoting S41nt
In all honesty, his disappearance only solidifies his standing in trading in my eyes. If I was him and was trying to help people learn an extremely valuable skill with 3 little kids at the house and the people I was trying to teach became ungrateful and disrespectful, I would leave too. He's provided some excellent value here and in reality, anyone can take it and start turning a profit. Yeah he had some hard trading times before his time off, but he doesn't owe anyone here anything. Someone mentioned that he was helping with family, and that could...
Hi S41nt,

I did not want to start again with that topic since posts here get misunderstood and put into the negative very fast, but I wanted to make some things clear. I cannot remember anyone being "ungrateful and disrespectful" before Mr. Pip's disappearance which could result into him stepping away from the thread. Nobody is trying to attack him, so no need to go into a defensive stance as some other people already did or to recommend people should do their "damn work" only because they speak about the situation which happened here. Im sure everyone is doing their "damn work", since obviously many people changed the systems' rules.

Besides that I agree a 100% with your post. Just wanted to make this point clear, since you participated on that topic putting things into a wrong view.

The point here was to say that the system in its basic rules does obviously not work for many. I dont know a single person here which trades 100% on the basic rules of the system making profits with it. Thats why many (all?) persons who are active here have made changes to it. Some stepped away from it. And thats great to make things work and not doing the same over and over again receiving the same results which are not satisfying. Mr. Pip ran into the same situation with his 5k account and after dropping this account into the lows he disappeared without a word. With all his teachings and announcements he made before that it was a very strange behaviour of his side in my opinion. As you said, he ows us nothing, but a comment of his side or some feedback would be much appreciated since many people have put in years to learn his system. Even with kids etc, 2 minutes to reply to his own thread would not hurt, I guess, taking his huge announcements and efforts prior into consideration.
  • #49,193
  • Feb 26, 2020 8:04am Feb 26, 2020 8:04am
Quoting Hansl
{quote} Hi S41nt, I did not want to start again with that topic since posts here get misunderstood and put into the negative very fast, but I wanted to make some things clear. I cannot remember anyone being "ungrateful and disrespectful" before Mr. Pip's disappearance
heheh I can ... I remember the guy that came here badmouthing everything and how he just bought an apartment in Dubai by following the "youtube popular gang" ! one of the few bans Mr PIP did.

But on topic, please, system or no system, profitable or not profitable, can we please have respect for a guy that worked his ass off to help others during almost 8 years now ? If he disappeared, there must be a solid and respectful reason. Nobody does something for 8 years just to "dishonestly disappear". Please have some respect for that, as is too much time and too much work to just "disappear because some trades were bad".
  • #49,194
  • Feb 26, 2020 8:06am Feb 26, 2020 8:06am
Quoting Hansl
{quote} Hi S41nt, I did not want to start again with that topic since posts here get misunderstood and put into the negative very fast, but I wanted to make some things clear. I cannot remember anyone being "ungrateful and disrespectful" before Mr. Pip's disappearance which could result into him stepping away from the thread. Nobody is trying to attack him, so no need to go into a defensive stance as some other people already did or to recommend people should do their "damn work" only because they speak about the situation which happened here. Im...
Hansl,

I agree. Honestly, the last few live streams brought up in a lot of negativity. That on top of hitting DD would be a lot of emotions to handle for someone who isn't used to being that open. Yes there is this thread, but there is something different between posting on a thread, and being on display for everyone else to criticize live. The guy is still human.

As far as the basic rules go, Mr. P says at the beginning, that taking every trade that fits the plan leads to profitability. I would say the reason that most people aren't successful with the rules is because Mr. P would take trades more aggressively than all of us. If there was an expectation of a deep correction, and it only retraced to the 50 and rotated, Mr P would take the trade because it fit the plan. I've noticed that after I started taking myself out of the equation more and worked with the market, the more I have been profitable and stopped getting in my own way. If you go back to Mr. P original videos and posts during that period, he takes trades extremely aggressively and makes a lot of money doing it, but they are all within the original framework of his style. Evo trades Mr P's style extremely well, and it seems he is using the basic system. Evo just looks like he trades multiple order flows at once, but in the end, it is still the basic framework. Mr. P didn't even trade on the "basic rules" of his style towards the end, he changed from the subjective clear high and low, to a more rigid framework of "price must retrace to the 38.2% of a swing to be valid." In my opinion, this is where he started having difficulties, but that is a different conversation.

I appreciate you coming at this level, you're right I was a bit heated and frustrated at the recent conversation. Yes, he may have disappeared and left people a bit hurt, but showing this frustration on his thread doesn't help in making him want to come back. Give him some time, and if/when he wants to come back he will.
  • #49,195
  • Feb 26, 2020 10:24am Feb 26, 2020 10:24am
Don't go thinking Damian doesn't read the forum o, all he as to do is brows in a private window
  • #49,196
  • Feb 26, 2020 11:31am Feb 26, 2020 11:31am
Quoting bmdenton23
{quote} I don't really want a debate but I do feel compelled to make sure that your statement: "it's time for him to put the ego aside and admit that he needs to make some changes to his daytrading strategy cause it simply doesn't work in the current markets anymore" is at least challenged so that new traders who stumble across this thread aren't scared off by such statements. Since the start of 2018, if you traded every swing that was at least 40 points and less than 200 points, entering on a 42% pullback, exiting at the one to one or 1.27% extension,...
Hello bmdenton,

Thank you for the interesting backtesting results. It shows pretty well the potential of the basic system.
Currently I am thinking of switching to the MYM (from the YM) to be able to be more flexible with the trade management and to keep the risk per trade constant - independent of the swing size. To have a first glue how this will effect the system, would it be possible for you to run the backtest with a constant risk per trade, i.e. adapt the number of contracts for a trade accordingly?

Thank you very much.
  • #49,197
  • Feb 26, 2020 11:59am Feb 26, 2020 11:59am
Quoting fxboss69
{quote} Hello bmdenton, Thank you for the interesting backtesting results. It shows pretty well the potential of the basic system. Currently I am thinking of switching to the MYM (from the YM) to be able to be more flexible with the trade management and to keep the risk per trade constant - independent of the swing size. To have a first glue how this will effect the system, would it be possible for you to run the backtest with a constant risk per trade, i.e. adapt the number of contracts for a trade accordingly? Thank you very much.
I think the MYM is a good index to trade with these wild swings. Not only that, but from a money management side of things, but adding the risk can be more gradual.

I posted an excel spread sheet that is more in depth about this. Although it is for trading the forex market, with the micro futures, it works just like forex as being able to use smaller lot sizes.
Luck has no place in trading. Leave that for the poker table.
  • #49,198
  • Feb 26, 2020 12:16pm Feb 26, 2020 12:16pm
Quoting fxboss69
{quote} Hello bmdenton, Thank you for the interesting backtesting results. It shows pretty well the potential of the basic system. Currently I am thinking of switching to the MYM (from the YM) to be able to be more flexible with the trade management and to keep the risk per trade constant - independent of the swing size. To have a first glue how this will effect the system, would it be possible for you to run the backtest with a constant risk per trade, i.e. adapt the number of contracts for a trade accordingly? Thank you very much.
I'll give you some "entertaining at best" stats, frankly I just don't know any other way to go about it..........

I ran this test back in August against the YM. Using a max swing size of 200, and entering at the 42% retracement, the max loss in points that can be taken is 116. If I break that into a granularity of 10 steps, that means you would trade 1 contract for a 116 pt risk trade, and 10 contracts for anything smaller than 11.6 risk. Over a year the average contract size taken was 6. So for comparison ran the same test using 6 contracts versus using the variable size.

1960 trades taken between 8-21-18 and 8-21-19

Static 6 contracts
102,090 points
Max DD 5190
PF 1.35
49.29%
1.39 RR

Variable Contracts
97,051 points
Max DD 5702
PF 1.33
49.29%
1.36 RR

So my takeaway and I can also prove this using other tests, is that larger swings had better expectancy, at least for that particular period.
So if you use smaller size to trade swings that have better expectancy it ends up hurting you, having said that the difference is not significant enough to prevent one from using the sizing methodology. I certainly do in my FX account.
  • #49,199
  • Feb 26, 2020 1:06pm Feb 26, 2020 1:06pm
Quoting bmdenton23
{quote} I'll give you some "entertaining at best" stats, frankly I just don't know any other way to go about it.......... I ran this test back in August against the YM. Using a max swing size of 200, and entering at the 42% retracement, the max loss in points that can be taken is 116. If I break that into a granularity of 10 steps, that means you would trade 1 contract for a 116 pt risk trade, and 10 contracts for anything smaller than 11.6 risk. Over a year the average contract size taken was 6. So for comparison ran the same test using...
Bmdenton,
Thank you for the great work! The stats looks very promising and I am sure that I will benefit from the "variable" approach.
Up to now I observe a psychological barrier to enter larger swings due to the involved risk. To compensate for the risk, I tried to enter the larger swings by waiting for very deep retraces which leads to the problem of missing a lot of good opportunities and therefore hurting my expectancy.
  • #49,200
  • Feb 26, 2020 2:08pm Feb 26, 2020 2:08pm
Hey Bmdenton, have you ever ran a simulation with the method using a fixed percentage money management style? Like 5% per trade or something.

I'm wondering how the compounding method of that style will work over time compared to just a fixed contract style. I've noticed using a percentage (fixed-fractional maybe?) has helped my psychology out a lot since I know how much I am going to lose every time, I'm just curious if it hinders profitability.

Please excuse me if that has been answered above.
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