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  • #121
  • May 20, 2021 2:46am May 20, 2021 2:46am
Thank you for your comments Ex3m6 (You really must explain to me the genesis of your nickname! ) . I am glad you find this interesting and I like your approach to educating yourself. Asking questions is a good way to learn.
  • #122
  • May 20, 2021 7:46am May 20, 2021 7:46am
thank you for this thread and thank you for the flat market detector.

2 questions 1. Does this indicator repaint?
2. Is it possible to get a version with an alert on color change only? When it changes
from lime to black and vice versa, regardless of side of the 0 line.

thank you!
  • #123
  • May 20, 2021 8:57am May 20, 2021 8:57am
Quoting digitalzen
thank you for this thread and thank you for the flat market detector. 2 questions 1. Does this indicator repaint? 2. Is it possible to get a version with an alert on color change only? When it changes from lime to black and vice versa, regardless of side of the 0 line. thank you!
I am sorry, are you sure you are in the right thread?
  • #124
  • May 20, 2021 9:12am May 20, 2021 9:12am
Ah, I can't resist! Another money shot for when I will decide to sell this strategy for a gazillion Dollars.

Frankly, throw in one or two MAs in any sauce you like and even my goldfish could have made make money today! 2 good trends, a trend following strategy, it works! “Magic”! Show enough of these charts to "dream seekers" and you may have a nice business model.

This is the DowJones CFD on a 5 min chart, from 8 am London time (first vertical line.)

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This is the simple strategy left alone: no intervention. You would still be long, perhaps trailing your position below significant lows on partial pullbacks to defend some of the amazing profits.

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This is if you try to be "smarter" and use highly expensive proprietary volume analysis tools that I have access to . The green line was an area of greater volumes and Support, now perhaps Resistance.

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This is if you tried to be smarter still and apply Pivot points and BRN. Hmmm....Today it looks as if "smarter" means “dumber”. Tomorrow it may be the opposite. Who is “right”? In my opinion, it's those who have followed their rules and their plans, based on their preferences and their statistics.

Incidentally, notice that at levels like these (33-34,000) I would have some doubt to call 33,900, 34,100 etc. BRN, as numbers are ...."off the scale", compared to other instruments. In fact this instrument does not really seem to notice them.

Notice also that it did not pay any attention to the green area I cleverly identified as Support and Resistance with lots of volume....or will it?

But let’s assume you do apply S/R and PP and BRN to your analysis. What would you have done on the first signal? And on the reverse? Where would you have entered, and got out? where would you have placed the stops? Would you have re-entered after taking possible profits? etc. etc.
  • #125
  • May 20, 2021 9:42am May 20, 2021 9:42am
Quoting capm
{quote} I am sorry, are you sure you are in the right thread?
Yes a contributor to the thread added it as an option and it works fantastically. thanks
  • #126
  • May 20, 2021 9:43am May 20, 2021 9:43am
But I am not here to sell the strategy for gazillions of Dollars, unfortunately. This however gives me the freedom to use other examples where there are losses or things go a bit bananas. Easy to find them: look for choppy charts.

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Here is EURJPY, 15 minutes, today, from 8 am London time (black vertical line.)
This chart is a mess on so many levels! Let’s see if we get some lessons here. The short signal is right into a Support zone. So, what do we do? We can either forget it and look for better chances elsewhere. Or we can place the entry below the Support zone. Usually, when broken, the move goes on for a bit, since breaking these zones requires some momentum, some commitment, from, in this case, the sellers.
So, let’s say you are short. Look to the left (not showed here) and you see where there may be some other support. That may be our target. But we never get there. If you are a fan of PA (I am !) you start worrying immediately after the third candle after the entry (search and find out why.) In fact the market stops there. And after a while one histogram starts printing blue: you lost the signal. This is a first (well, second) sign to get out.
After that it’s just hours of nothing. The long signal should be widely ignored (on BRN and Pivot point). You have other chances to get out at Break even, luckily.

In the absence of any EUR and YEN related news (or some other big ones) traders do not really know what to do and respect those psychological levels, especially if you have more than one on the same place, like in this example.
You can use this chart to reply to those that say that BRN, Pivot points, S and R are rubbish. But do not argue with them: they are probably fundamentalists and it is better to leave them alone with their dogmas!
Again, any question, ask.
  • #127
  • May 20, 2021 10:01am May 20, 2021 10:01am
Quoting digitalzen
{quote} Yes a contributor to the thread added it as an option and it works fantastically. thanks
Ah, ok, sorry. In this case you have to ask him directly. I have no idea what that indicator is about. Not saying it is not good. I just do not know.

On this note, though, may I ask you on what basis you said it "works fantastically"? You can't have had it for more than a week or so. Did you do a lot of back testing? Did you use it on many instruments or just, say, Equity indices this week, where it was rather easy to make money?

Sorry, I am not trying to be confrontational here or to pick on you. I just would like to use this opportunity to warn people about picking an indicator they have no idea how it works (I am not saying this is necessarily your case), slam it on a chart, get some results and think they have found "the answer".

Having said that, I sincerely hope the indi in question does indeed do a great job. Now I am curious, I will have a look when I have time.
  • #128
  • May 20, 2021 12:51pm May 20, 2021 12:51pm
Quoting capm
But let’s assume you do apply S/R and PP and BRN to your analysis. What would you have done on the first signal? And on the reverse? Where would you have entered, and got out? where would you have placed the stops? Would you have re-entered after taking possible profits? etc. etc.
this is what I would have done. Well, I have to admit it's always easier to make a decision when you know the future. In theory it's what I would have done, but in reality...
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  • #129
  • May 20, 2021 12:57pm May 20, 2021 12:57pm
Quoting capm
Thank you for your comments Ex3m6 (You really must explain to me the genesis of your nickname! ) . I am glad you find this interesting and I like your approach to educating yourself. Asking questions is a good way to learn.
It is an enigma. Maybe with time you will find the signification.
  • #130
  • May 21, 2021 3:25am May 21, 2021 3:25am
WOW, Ex, lot of work for me to go through! And since nobody pays me to do it, I won’t! Perhaps, if there is enough substance, I may open a chat channel where I can comment on things like these. I make no promises though.

I would make some comments.
First, yes, hindsight is always the best strategy ever!
Secondly, it is just one chart and of course this is an example, but if this was your regular style of trading I could already tell quite a lot about what kind of trader you are. You look like a “scalper”, a “quick buck, ask questions later” trader. Absolutely nothing wrong with it, of course.
So, this tells you that:
a) You may have problems following a system that needs to “let the profit run”
b) You may have problem dealing with pull backs which will dent your open profit (which is the same as a) anyway)
c) You may not have problems following a trend by re-entering at the suitable spots
d) You may not have problems adding to your positions if you are in profit
Well, just a few things.

I may have used other places to place the SLs, for example on "Exit(0)", or "SL(2)", but I think you got the gist of the strategy.

Some other points to think about would be: would you have made more points in letting the profits run (calculate costs: B/A spread, fees, possible slippage)? Would you have felt comfortable doing so? Would you have been able to follow this manually for 8 hours? if not, what would be your strategy? Etc.
Good stuff, man!
  • #131
  • May 21, 2021 4:16am May 21, 2021 4:16am
Quoting Shouma
So as I promissed yesterday, here is the current Alpha-Version of the Indicator(Update from Post#34). Patchnotes: -now shows signals from the past(just attach it to any chart, any timeframe) -time filter available -two different colours for better visualizing coming in the next version: -alerts -better visualization of the breakout lines -.... -anything you wish here If you(capm) don't want, that I code indicators for your idea, then just tell me and I will stop. But I just love coding(even more than trading) and I found this thread very...

Hi Shouma

Thank you for this, it is very helpful. Are you in a position to provide the updated version , with added alerts?

Thank you
  • #132
  • May 21, 2021 7:58am May 21, 2021 7:58am
So, algo or Hybrid? A couple of examples from today on 5 minute charts.

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This is cable 5 m on the simple mechanical strategy (let’s call it SMS). You start with a loss and then you have 2 wins. (you would still be short on the second one, but at some point you have to close for the day: it’s Friday afternoon, come on!)

If you started your “algo” in the morning and came back to turn it off, without watching what happened tick by tick, you may be pleased. But if you are doing this manually, of are checking from time to time, you would have had quite a number of difficult moments. If you applied discretion based on PA, there would have been quite a lot of stuff that “did not make sense”.

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There is a very tiny chance that you would have avoided the first loss. Go back in the chart and see if you can identify a support area. I traced it there in green at the bottom. It was not super clear though. It became so after we entered. So, let’s put this down as a loss. You could have mitigated the loss by placing the stop just above the high of the last retracement, saving a few points but not much.

Then you have a long signal. This is rather close to the BRN 1.4200. Usually, if there is enough space, I take it and see if what it does at BRN, with a tight leash if it rejects it. In this case it did not reject it. It went up to test the Resistance green area (notice how there was a bit of a battle there between bulls and bears.) It then past the R1. I would have trailed this long with some breathing space and got out when it re-tested R1 on a pullback (which turned out not to be a pullback at all.)

Then we had a short signal, again, quite close to BRN. Tight leash again. This time it does reject it, with a pin bar to reinforce the message. So, this time it is a Break even. Now we have many options. Some traders would place a sell below BRN. Usually they would place a SL just above the BRN and they would have been taken out for a loss. Notice that that brief range just below the BRN happened at the previous break out point (where we went long before.) This is usually a place that gets re-tested . So I’d rather wait until that level is cleared. There was a big battle around BRN and finally, soon after a renewed sell signal, we have the break-out. Target at the green area (where it stopped), or the Pivot point below, which was indeed tested, but it’s too late for me on Friday.
  • #133
  • May 21, 2021 8:29am May 21, 2021 8:29am
The second example is the bloody FTSE (we have been enemies for a long time!)
This is a great example of the proverbial “stupidity” of the algo (at least the simple one we have here.)

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Black vertical line is London open. We immediately have a sell signal. I just noticed that the algo should have entered a bit earlier, below the doji candle. I usually wait a bit at London open, as anything could happen, so I prefer to wait for the big break-out. It does not matter much in the example, but I needed to clarify this.

Because the move is so fast, the MAs do not have time to digest the move and do not calculate a buy signal until the market has completely turned. So a 33 points open profit (not bad on FTSE) is turned into a 6 points loss. This is one of the problems with algos. You can code additional rules to protect the profit, etc. but my experience is that every time you try to solve a problem you create 2 new.

After the long, nothing happens. The market goes sideways for the rest of the day, in a range that is well defined by an upper boundary (in green: Res/sup/res) and a lower one that I did not draw, but it Is obvious.

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Now, let’s apply our “magic”? here too. The short has a first pause at daily pivot (blue horizontal line) where we could take some profits. It then goes further down but I can not identify any particularly important point (hey, it does not work all the time!) So +13 is fine or, if you trail it closely, you may have a +21 (in green.)

The range after the long is not too bad, actually, because most of the time you would be in profit. Some people may get bored or worried and get out at B.E., some other may take profit close to the green area of resistance and I know some people who would really really really wait until it actually touches that area ( acting more like a machine and in so doing risking to give back 12-14 points profit for an extra 2 point!)

To each his/her own. Notice that, strictly speaking, the algo would still be long and you have to close it manually.

I hope it helps. Have a great weekend, everyone.
  • #134
  • May 22, 2021 9:09am May 22, 2021 9:09am
Quoting capm
WOW, Ex, lot of work for me to go through! And since nobody pays me to do it, I won’t! Perhaps, if there is enough substance, I may open a chat channel where I can comment on things like these. I make no promises though. I would make some comments. First, yes, hindsight is always the best strategy ever! Secondly, it is just one chart and of course this is an example, but if this was your regular style of trading I could already tell quite a lot about what kind of trader you are. You...
Thank you for your feedback capm
You have summarized well the problems I have in my trading. Unfortunately I don't have all the answers to these questions, at least not yet.
  • #135
  • May 24, 2021 1:08pm May 24, 2021 1:08pm
Well, judging from history, so far the less I argue with someone the less appealing this thread seems to be. That is a bad incentive! And I thought the funny style was just a little sideshow!. It turns out it may well be the show. Ah, the things one learns from live experiments!
I could adapt and write about all sort of subjects (trees, pasta, meteorites, crypto, etc.) in an entertaining style. Nah, not yet, let’s inflict some more pain to you lot.

Let’s start with a hmmm-ish result. 5m cable today, from Frankfurt open to 4 pm London time. Choppy, nervous, spikey, with only one defined trend. We should expect very little form the Simple mechanic strategy (SMS):

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This is one example of what our “superior knowledge” would have allowed us to do. I won’t comment each trade as it would take too long.

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  • #136
  • May 24, 2021 1:12pm May 24, 2021 1:12pm
Then we have the monster: the nightmare scenario for this kind of strategy, the example no self-respecting signal vendor will ever show: gold 5 m.
The SMS:

Attachment g
It looks as if designed to torn us to pieces! Here we would have needed a lot of “superior knowledge” to tame the monster. Admittedly, I do not think I would have been able to perform this well, but it was definitely possible.

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  • #137
  • May 24, 2021 1:19pm May 24, 2021 1:19pm
Finally, to balance and be fair to our poor old SMS, the nice scenario: oil 5 m.
SMS:

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Our “superior knowledge” here would not have helped much. In fact, it gave the same overall result, but without the loss in the middle, if losses are the kind of things you do not like.

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I show here that we stopped at 4 pm London time. In reality it was a fantastic trend, and it continued to ....ummm....wait.... really? Big Round Number.
  • #138
  • May 24, 2021 2:02pm May 24, 2021 2:02pm
Quoting capm
Well, judging from history, so far the less I argue with someone the less appealing this thread seems to be. That is a bad incentive! And I thought the funny style was just a little sideshow!. It turns out it may well be the show. Ah, the things one learns from live experiments! I could adapt and write about all sort of subjects (trees, pasta, meteorites, crypto, etc.) in an entertaining style. Nah, not yet, let’s inflict some more pain to you lot. Let’s start with a hmmm-ish result. 5m cable today, from Frankfurt...

Hello capm,

I have been reading your work a fews day now,thank you for posting and uploading knowledge in trading using your system successfully,any questions i'll ask,but you're a good teacher...keep it up.
  • #139
  • May 25, 2021 11:42am May 25, 2021 11:42am
Ah, some motivation and support! Thanks scsstnt!

I do not have much time these days, so I just show some charts with the simple mechanical strategy (SMS) and the comparison with what could have been achieved with some basic knowledge of PA.
Let’s start with the good shot: look for a chart where a trend is obvious and you have a pretty good chance to discover that the SMS worked! GU 5 m:

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In a good trend, our “superior knowledge” sometimes makes us work more for a similar (sometimes worse, sometimes much worse!) result. This time it was about the same but with one more trade. The upside here is that you actually made it thanks to your “superior analytical skills” rather than following a stupid rule.

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  • #140
  • May 25, 2021 11:48am May 25, 2021 11:48am
Then, of course, for balance, let’s show the monster. This is courtesy, for the second time in a row, of Gold 5m. Look at it! Heaven for highs and lows pickers, hell for trend followers. If a tend following strategy works here then it is not a trend following strategy.

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Here our ”superior knowledge” acts as a great filter, identifying big obstacles and avoiding “stupid” entries. I draw the actual MA lines in this chart to show how they were flat, another sign of danger. Notice also how well this instrument has respected the Pivot points (PP, S, R)

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