ST Patterns

GOLD - 400% Take Profit!

GOLD - New corridor

GOLD - STOP OUT

Hi,

I'm reading the books now and am interested in forward testing your EA.

My registration:
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Thank you in advance

HI BigBug,
Are you using the EA? Or are those manual trades?
Just started reading the books and I think this mythology has some of potential.

Manual Trades.. Trying to apply what i understand from the book.

GOLD - With hindsight, this looks like "ST double reverse pattern". Question is how do we trade?


1. After the new corridor (dark green) was formed, price broke the threshold (X=2) and a new trade was opened.
2. Then the price reverse into the corridor and down crossing the STOPLINE. Trade was stopped out.
Question 1: After the stopped out. Do we consider this "dark green corridor" complete and start hunting for new corridor?
3. Price continued down and broke threshold again..so "ST Reverse Movement" forming?
4. If so, book says we should open a new trade in the reverse direction.
Question 2: Which corridor to use? The previous dark green corridor? or the new "RED (STOP) and BLUE (START)" lines as these 2 fractals are the nearest opposite fractals..
5. So 2nd trade was opened, but price reverse the 2nd time.... trade was stopped out again by the RED (STOP)..

6. Now... with hindsight, if we just based on the very first dark green corridor, we are seeing a nice "ST double reverse pattern"

So how should we trade???

I really like the books and do find them educational,But, there are some trades he shows that I don't understand why he enters there. Which in turn creates all the reversal patterns. I look for S/R and trade the retest. Its been working well so far.

GOLD - updated chart. Will take it as "ST double reverse" for now.
Trade A - stop out
Trade B - stop out
Trade C - opened with the nearest pairs of fractals.

GOLD - "ST double reverse" did not materialise..
Trade A - stop out
Trade B - stop out
Trade C - stop out.. pattern complete? Start to look for new fracture..

Your code is: T7guax0BSCwrs12w5Szh3/kbo4ghjkCevBIqDzffJyc=

how to get the ea and the book

all,

for those who have the EA, have you back tested this strategy?

I made my own EA which follows the strategy closely, and back tested on a few pairs, the result is poor. i only see "ok" results on GBP/USD. EUR/USD is very bad, gets closed out on SL most of the time. I do not see how the auther could have made 800%......

Hey indaone, I don't have the EA mentioned in this thread but I've been backtesting the strategy with one I made myself. I haven't started forward testing or live trading yet, but I have confirmed the trades from books 1-3 in backtesting. I can let you know how it goes when I start trading for real. I would recommend you check if your EA is able to match the charts from the books to make sure it's working correctly, if you haven't already done that. There are some minor data inconsistency gotchas that you have to watch out for (some values being different usually by a tenth of a pip or so, which can make your decisions different than the ones in the book and make it hard to check against the charts in the books). Hope that helps.

I am trying to learn using the strategy on a demo. When we see a corridor setup, there are two directions to plot the fib levels. How does one decide which way to plot or should we just plot both ways and wait to figure out which one will be broken/fracture?

I think you might be making a mistake I also made for a while. Corridors can only form in one direction. A corridor forms the moment the price crosses a fractal, and it means you will be trading in the direction of the break. For example, if the price breaks an upward fractal, that fractal then becomes the start line for a “buy” trade. At this moment, you search backwards and find the opposing fractal where you will place the stop line. What I was doing is looking for the nearest opposite fractal the moment a fractal formed, and then seeing which way the price went. This is not correct. Hope that helps.

Hi ShadowForex,

Hope the following diagram helps.
1. Corridor is formed the moment price crosses/breaks a fully formed fractal.
2. Candle C crosses a nearest (most recent) fully formed fractal at Candle B
3. Since it crosses UP, so the direction is UP. START Line is always at the broken fractal i.e B

hi Temerity,

I looked at the chart i had from my EA's backtesting and compared it with the author's and found some fractals are different. for instance my chart would have an extra fractal where the author's didn't, and this resulted my EA not taking the sell trade due to the extra fractal made the corridor smaller than 12 pips, hence stayed out. and because this trade didn't take place it didn't close my previous buy trade neither after 210% hence just that extra fractal on my chart made me about twice worse off the result shown on the author's report. I actually emailed the author about this and he's reply is that quotes differ from brokers and brokers.

I also implremented the measurement error which is stated in his 4th book. but the result aren't much different.

Overall the result has been disappointing. very often i found the buy or buylimit order would be placed right at the top of a ranging market and a sell or sell limit order would be placed at the bottom of a ranging market if those orders are placed based on the entry signals. so I do not believe that this system would work in ranging markets.

look forward to see your feedback on this.

Hi Bigbug,

i think in your case the start line should be moved to C if the trade hasn't entered and once C is fully formed.

I have attached the chart difference between mine and author's.

I basically backtested the same period but got very different results. the problem is with the fractal difference as pointed out in my chart.

Hi everyone,

For those interested in this strategy and asking themselves about its efficacy, I’d like to share some thoughts :

1. After exchanging emails with the author, he shared his view about creating an EA and the difficulty it would imply to make it flawless. It takes much effort, as the author himself has not yet succeeded to create a perfect automated system. Manual old school backtesting is the best way to see how it works for you.

2. Speaking about backtesting, I’ve tested the strategy on one of the major pairs since January 2020 till June 2020 (M5) using TradingView rewind and charts provided from FXCM. As Vladimir writes himself in the 4th book, you can have some stellar months as the +1000% in the example, or « significantly worse ». He dwells on the fact that market volatility and liquidity is key to profitable patterns, otherwise you will have frequent unprofitable reverse patterns that will distroy your portfolio.

3. To give you some colors about the performance, January for instance was a « stellar » month, with about +1000% total performance using 10% risk. February was okay, +200%, At some point in March the strategy went up to +2000%, before giving up half the performance by the end of the month. In contrast, April was disastrous, 1st April you have a -50% drawdown, and by the end of the month you’re about breakeven after 80 trades. May was worse, with about -35% performance. Therefore don’t expect a linear equity curve, it all depends on market conditions. You had some ugly looking days in April-May, with single 5min candles jumping 20% of daily range.

4. if you decide to trade this manually, it is not difficult. 50% of days have under 3 trades, and it ranges from 1 to about 7 trades max. But you have to be follow the chart quiet often, this is true.

5. furthermore, 10% risk on M5 uses leverage, so for a minimum corridor size of 2pips, X and stoploss parameters from the book, you must have a 166x leverage. Also if you trade big, you will have slippage.

6. I still have not used this in real money trading, started demo trading since June.

If you have any thoughts or would like to share your results feel free.

Best