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Profitunity (Chaos) Trading System by Bill Williams

  • #41
  • Edited 11:31pm Apr 26, 2007 11:19pm | Edited 11:31pm
Well nothing is forever...

This morning seems that market is wondering which way to take.
No momentum, acceleration is broken.

But this created two valid new sell signals a fractal and AO and one Dbar (false by the rules - because in almost in the lines)

I placed a 2 lot sell order for AO and a 4 lots sell order for F and moved stop above last 5th bar.

Let's see what will has in mind the market today.
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  • #42
  • Apr 27, 2007 1:37am Apr 27, 2007 1:37am
No more wondering.
Trade started yesterday (post#40 and post#41) is closed.

I want to mention two points

The strong support aroung 1.3585 make me to get out from last two orders. This gave me a smal profit of 1 pip ($60 for all 6 lots)

Dbar makes me to keep Stop loss tight which helped me to exit from the trade with profit.
Small, but profit...

Here is trade data:
Inserted Code
[b]DateSignalPriceSLP/Llots:[/b]
26.4.2007 12:31DB1.36251.36120.00131
26.4.2007 12:33F1.36151.36120.00031
26.4.2007 16:13Z1.35971.35940.00032
27.4.2007 00:00Z1.35941.35940.00004

4 orders ( 3 profitable, 1 zero)
8 lots traded which returned 220 profit

So I'm off and wish you a calm week-end
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  • #43
  • Apr 28, 2007 6:18pm Apr 28, 2007 6:18pm
Quoting dlftrader
I have been a Profitunity trader of one degree or another since 1999. I moved my trading focus from futures to the spot Forex in 2004. It is still my trading vehicle of choice for catching a strong trend and capturing profits far greater than the move itself... it has given me over 300% of a move on several occassions. As time permits me, I will be glad to share some of my experiences with using all or part of the Profitunity trading approach; but for now, these words of caution: Have very sound risk management rules (the Profitunity way doesn't give you much guidance here!); and if you are one that tends to play loose with risk management rules, Profitunity will probably frustrate you!

...\larry.bye

Thanks for your offer of help Larry. I believe that the strategy of adding to a trend makes lots of sense. My question is indeed about your risk management strategy. What size do you make your lots? Do you very the size at all or keep the size equal and take each signal?

THanks for your help.

Jim No
  • #44
  • Apr 29, 2007 12:09pm Apr 29, 2007 12:09pm
Hello Jim
Quoting james275
Thanks for your offer of help Larry. I believe that the strategy of adding to a trend makes lots of sense. My question is indeed about your risk management strategy. What size do you make your lots? Do you very the size at all or keep the size equal and take each signal?

THanks for your help.

Jim No
Until Larry answer the questions, here is Bill Williams point of view as it is layed in his books (in brief trnasformed by myself):

In past years trends have been strong and relatively long this is why he suggests to add a contract on each signal. Nowadays trends are less long and are rare and this is why we have to profit from short moves increasing contracts on each signal. He also suggest adding in following proportion:
1:5:4:3:2 - i.e. 1st signal 1 contract; 2nd - 5 contracts; 3rd - 4 contracts and so on...

I personally do not use the above system, but dicide on each signal depending on overall situation of the market....

Regards...
  • #45
  • Apr 29, 2007 2:49pm Apr 29, 2007 2:49pm
Quoting isto
Hello Jim

Until Larry answer the questions, here is Bill Williams point of view as it is layed in his books (in brief trnasformed by myself):

In past years trends have been strong and relatively long this is why he suggests to add a contract on each signal. Nowadays trends are less long and are rare and this is why we have to profit from short moves increasing contracts on each signal. He also suggest adding in following proportion:
1:5:4:3:2 - i.e. 1st signal 1 contract; 2nd - 5 contracts; 3rd - 4 contracts and so on...

I personally do not use the above system, but dicide on each signal depending on overall situation of the market....

Regards...

Thank you. I really think that adding on is a good profitable strategy. I like that you don't risk so much during the sideways market and then bump the # as the trade continues.

I enjoy your thread!!

Good Trading,

Jim No
  • #46
  • Apr 30, 2007 6:04am Apr 30, 2007 6:04am
Early Monday we have a GBPCHF Bullish DBar. This setup is a little bit confusing because there are lots of up and down signals ...

We have two up fractals which are forming a Double Top and in the same time three down fractals forming Head and Shoulders in the bottom.
Momentum is weak. Acceleration is down. On the other hand we have a gap down filled immediately during next few sessions

Anyway I decided to buy a lot and give a try to the devergent signal. I was lucky enough for the price rallied up.

So currently I've moved stop loss a little bit above breakeven and have 1 lot on the long side.
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  • #47
  • Apr 30, 2007 7:29am Apr 30, 2007 7:29am
Just a short message...
stoploss (from previous post) was hit during the previous session and I'm out with 9 poits profit.

That's it for now...
  • #48
  • Apr 30, 2007 12:09pm Apr 30, 2007 12:09pm
Drifting around I found this strong setup formed by USDCAD:

 

  1. steep diving
  2. greate angle between MA and price
  3. close at the upper half


Additionally we have

  1. acceleration slow down in D1 and long decline
  2. unsuccessful bottom break at W1
  3. Momentum and AO strong divergence in MN and H4


So I'm going to give a try and put a buy stop above Dbar at 1.1107 with a stoploos on the oposite side of this bar at 1.1044

Let's see what will say the market...

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  • #49
  • Apr 30, 2007 12:22pm Apr 30, 2007 12:22pm
Quoting isto
Drifting around I found this strong setup formed by USDCAD:

  1. steep diving
  2. greate angle between MA and price
  3. close at the upper half

Additionally we have

  1. acceleration slow down in D1 and long decline
  2. unsuccessful bottom break at W1
  3. Momentum and AO strong divergence in MN and H4

So I'm going to give a try and put a buy stop above Dbar at 1.1107 with a stoploos on the oposite side of this bar at 1.1044

Let's see what will say the market...

Hi isto, what time frame is the chart you have pictured ? On all of my usd/cad time frames I'm not seeing it. Thanks.....
  • #50
  • Apr 30, 2007 1:04pm Apr 30, 2007 1:04pm
Quoting amaruenterprise
Hi isto, what time frame is the chart you have pictured ? On all of my usd/cad time frames I'm not seeing it. Thanks.....
H4 (four hours).

Sorry I've missed this because this is the most suitable for me timeframe. There might be some difference in prices but in general should be the same
  • #51
  • Apr 30, 2007 3:52pm Apr 30, 2007 3:52pm
Quoting isto
H4 (four hours).

Sorry I've missed this because this is the most suitable for me timeframe. There might be some difference in prices but in general should be the same
Thanks for the reply isto. The H4 timeframe is pretty much what I trade off of but I do like to look at the other timefames as well. Thanks once again and I really appreciate your thread and look forward to reading your analysis on your trades as well......
  • #52
  • Apr 30, 2007 6:43pm Apr 30, 2007 6:43pm
Isto, how do you get the extra signals shown on the chart? Is that some special indicator you have?

I too appreciate this thread.

THanks...

Jim no
  • #53
  • Apr 30, 2007 11:27pm Apr 30, 2007 11:27pm
Hello Jim
Quoting james275
Isto, how do you get the extra signals shown on the chart? Is that some special indicator you have?

I too appreciate this thread.

THanks...

Jim no
Yes I have - it is a Chaos indicator made by miself because I prefer to be alarmed when a signal appears. It is in a test period ...
  • #54
  • May 1, 2007 12:08am May 1, 2007 12:08am
Hello

Surprisingly to me :surprised this night EURJPY has rally up. There was a fractal formed on Apr. 27 which doesn't seemed promising to me... ( this just confirms how hard is to predict price movement, if ever possible ) ... I had mark it (there was no buy stops set) and this is why I was in a little bit later

After this fractal has been taken few other signals had been triggered. Here we have:

  1. AO Buy and New Fractal signals on Apr 27
  2. Another three AO and two BL signals and one false DBar on Apr 30
  3. one AC signal on May 1
  4. two bars Green Zone


All of this signals but the last one has been taken tonight so I'm long with 5 lots (summarized) with few pending orders

Let's see what the market has in mind...

Attached Image
  • #55
  • May 1, 2007 12:20am May 1, 2007 12:20am
Here is how is going DBar on USDCAD on H4 (post #48)

Buy stop order has been taken and I'm 1 lot long.

Meanwhile there is another DBar formed during previous session (another 1 lot buy stop has been placed) and down fractal below previous DBar.

It is stil unclear whuch way the market intend to go...
Attached Image
  • #56
  • May 1, 2007 10:45am May 1, 2007 10:45am
Jim No:
I apologize for the tardy response... I've been off playing grandpa.

First, my position sizing and risk management rules tell me exactly my lot limit for a trade; and for me "a trade" begins when I get on board a directional move and includes any subsequent add-on lots. A trade is opened only on a signal from one of the Three Wise Men. Here is how I normally allocate that lot limit:

  1. By my rule, I commit only 1 lot per buy/sell signal.
  2. Once a trade is opened, a signal is valid only if its fill will be beyond the Alligator in the direction of the trade.
  3. As long as my trade is profitable, I take all valid Profitunity trade signals until my lot limit is reached or the trade is closed. Valid Profitunity trade signals include those described in Bill Williams' second book, New Trading Dimensions.

Before adding on to a profitable position, pay strict attention to how the add-on will impact trade risk limits and where breakeven is!

...\larry.bye

  • #57
  • May 2, 2007 1:02am May 2, 2007 1:02am
Well EURJPY trade (beggining is in post #54 ) is closed because tonight stoploss has been triggered and I was kicked out

Here are orders:
Inserted Code
[b]DateSignalPriceSLP/Llots:[/b]
30.4.2007 23:56BL163.0800162.7-0.38001
01.5.2007 02:37AO+Z163.1400162.7-0.44002
01.5.2007 03:09BL163.1600162.7-0.46001
01.5.2007 06:22F163.2400162.7-0.54001
Total: -2 260

For now it is not clear where will go the market. Fractal buy orders are still pending... There is also a down fractal which I'm watching....
Attached Image
  • #58
  • May 2, 2007 1:13am May 2, 2007 1:13am
At the beginning of the yesterday US session the fractal that seemed to bocome a setup has been suddenly triggered and I fall into the market on the long side. Movement continues and a new up fractal was formed and lately triggered.

Here on the chart is seen one of the Bill Williams' recommendations: do not add on BL signal after 5th green AO bar, but move stop loss blow the Low of the previous to the current bar.

So I'm long with 2 orders (1+5 lots).
Attached Image
  • #59
  • May 2, 2007 1:23am May 2, 2007 1:23am
This is the order from yesterday (post #48)

We have 2 BDars and an up Fractal - all triggered at a strong momentum. Market is accelerating and the pictures shows a probable reverse of the movement from down to up (both down fractals have formed a double bottom).

This is the last trade I'm in for I do not like to trade simultaneously and I'm not going to entry new one
Attached Image
  • #60
  • May 2, 2007 2:33am May 2, 2007 2:33am
ISTO:
Re post #58. Didn't you mean "ZT" (zone trade) rather than "BL" (balance line) re Williams saying take no more signals after a 5th consecutive green AO bar?
...\larry.bye
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