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Profitunity (Chaos) Trading System by Bill Williams

  • #101
  • May 14, 2007 9:40am May 14, 2007 9:40am
Here is a nice trade on EURGBP rally.

We have two DBars failed (loss). Stop loss for each is marked with red lines on the chart.

Fortunately later another Divergent Bar compensated these loses.

Entries are marked with light green lines numbered from 1 to 4.
Orders 2,3 and 4 were 5,4,3 lots orders respectively.
Current stop loss is the upper red line.

There is more comprehensive reading about this here
Attached Image (click to enlarge)
Click to Enlarge Name: eurgbp-db-sample-20070514-h4.gif Size: 16 KB
  • #102
  • May 15, 2007 4:24am May 15, 2007 4:24am
Bullish Divergent Bar setup described in this post seems to end with 50 pips move total 58 pips profit $900

Inserted Code
[b]DateSignalPriceSLP/Ltotlots:pips[/b]
11.5.2007 08:00DB1.34851.35350.005050010.0050
11.5.2007 20:003AO1.35271.35350.000840050.0008
There are three Bullish Fractals that makret failed to take touching the 61.8 Fibo level.
Instead a Bearish Divergent Bar has been formed and trade was closed.
Attached Image
  • #103
  • Edited 3:46pm May 15, 2007 3:45pm | Edited 3:46pm
EURJPY trade started with a loss, ended profitably.

Below is the chart.
More comprehensive analysis is availbale here.

Geen lines show entry points; Red one - exit;

The result is:
Inserted Code
[b]Open  Exit  P/L    lots[/b]
161.75163.45  170    1
162.80163.45  65    5
163.20163.45  25    3
163.26163.45  19    2



Total: [b]279[/b] pips
Attached Image
  • #104
  • May 16, 2007 5:21am May 16, 2007 5:21am
Yesterday the news fired Buy Stop Oprder of a Bullish Divergent Bar opening the angle between price and red line (Alligator's teeth).

This surprisingly kicked me in the long side.

After the strong impulse movement has fallened and the next entry on the 3rd green AO bar failed. Few sessions later a new Bearish Divergent Bar was formed and I took it as a signal to go out locking the profit. Small profit is better that small loss, right?

It seems that Support and Resistance are too close and forces for the moment are strong enough...

More about the next step on this pair is available here.

Result is:
Inserted Code
[b]DateSignalPriceSLP/Llots:[/b]
03.5.2007 08:56DB1.97911.98550.00641

Total: [b]640[/b]
Attached Image
  • #105
  • May 16, 2007 7:21am May 16, 2007 7:21am
EURAUD trade (setup is in post #100) is ended.

At the begining stop loss has survived after the shart decline but Bearish fractal has not been taken so the patiance was compensated and an up move was fact.

3rd green AO bar has been taken and later the Bullish fractal was broken up.

Then there were another 2 orders - one on AO Zero cross and the other on 2 green AC bars.

Finally Exit was on 38.2 Fibo level cross down.

Inserted Code
[b]DateSignalPriceSLP/L$lots[/b]
11.5.2007 16:00DB1.62471.63450.00989801
14.5.2007 09:003AO1.62661.63450.007939505
14.5.2007 21:203AO1.62811.63450.006432005
14.5.2007 21:44F1.62821.63450.006318903
15.5.2007 16:19F1.62931.63450.005210402
16.5.2007 08:00Z1.63191.63450.00262601
16.5.2007 04:34AO1.63371.63450.0008801
16.5.2007 09:56F1.63691.6345[color="#ff0000"]-0.0024[/color][color="Red"]-480[/color]2

Total: [b][color="SeaGreen"]10 920[/color][/b]

Nevertheless I exit the trade there are still potential for up move. We'll see
Attached Image
  • #106
  • May 16, 2007 7:38am May 16, 2007 7:38am
Isto i love your way of trading (chaos trading) but i still find it hard to understand your first signal. the way you chose the DB because i see so many on the charts...
I will read Bill book again now, co's i am so confused about the first signal
  • #107
  • May 16, 2007 8:05am May 16, 2007 8:05am
Quoting Miguel
Isto i love your way of trading (chaos trading) but i still find it hard to understand your first signal. the way you chose the DB because i see so many on the charts...
I will read Bill book again now, co's i am so confused about the first signal
Hello Miguel

I'm glad you like this system.

Francly speaking I also had dificulties (this is for every begining, eh?) when I started. Even now I make lots of mistakes

Clear though the system require very titgh rule following because the trader easely could decide that current movement is accidental and soon will tun in "our direction".

As you could see from the previous post I am also often surprised by the market direction. There is no tool capable to predict market direction, especially forex. Probabilities - yes, but prediction... Last trade (post #104) was a (pleasent for me) surprise and the only reason I was in and made profit was following the rules.

DBar rules are simple. DBar has preceeding:

  1. steep move
  2. acute angle
  3. buy/sell stop order above/below the DBar


Next is patiance (easy to say ; hard to follow ) and always keep an eye on the stops.

Another sample I would point is this post #105 where it could seems the exit earlier but by my rules.
But this depends on one style of trading.

I personally prefer to lock profit when I've any doubt - actual profit is better than actual loss based on a hypothetical begger profit .

If you have questions I'll try to answer them. Read the books though. They are good and comprihensive.

  • #108
  • May 16, 2007 8:08am May 16, 2007 8:08am
Thanks for your time once again. I enjoy your blog also, good information there for chaos trading.
For me the hard part of the system is the to choose the DB to enter, after that things get more easy.

See you later!
  • #109
  • May 16, 2007 8:37am May 16, 2007 8:37am
Quoting Miguel
Thanks for your time once again. I enjoy your blog also, good information there for chaos trading.
For me the hard part of the system is the to choose the DB to enter, after that things get more easy.

See you later!
This is the most risky part endeed. Follow the rules above and knowledge with come with the practice.

I've made a check list (in my head for I'm lazy enough) and I'm trying to follow it as strict as I can. And again I make mistakes and miss one or another thing... But we are human beens...
  • #110
  • May 16, 2007 8:57am May 16, 2007 8:57am
I want briefly to menation EURCHF which shows another good sample of Bullish Divergent Bar trade.
There cosists of two parts because of the StopLoss has been triggered.

Where will go the market? A point of view is available here

Inserted Code
[b]DateSignalPriceSLP/Llots:[/b]
11.5.2007 16:00DB1.64511.64990.00481
11.5.2007 20:003AO1.64811.64990.00185
14.5.2007 01:00AO1.64911.64990.00085
-------------------------------------------------------------------
15.5.2007 15:34F1.65251.65340.00091
15.5.2007 15:35AO1.65261.65340.00081
15.5.2007 17:32F1.65331.65340.00011
15.5.2007 17:31S1.65311.65340.00031
15.5.2007 19:44F1.65211.65340.00132
15.5.2007 22:28AC1.65191.65340.00151
16.5.2007 09:19AC1.65281.65340.00061

[i]Rows above the line are closed trades; below are still active[/i]
Attached Image
  • #111
  • May 16, 2007 9:43am May 16, 2007 9:43am
Still another DBar Sample. Possition is currently open; seems to close soon
  • #112
  • May 16, 2007 12:23pm May 16, 2007 12:23pm
Well, the question where will EURCHF go (posr #110) was answerd

Stop Loss was taken and the final total is 2 460

Inserted Code
[b]DateSignalPriceSLP/Llots:[/b]
15.5.2007 15:34F1.65251.65340.00091
15.5.2007 15:35AO1.65261.65340.0008 1
15.5.2007 17:32F1.65331.65340.00011
15.5.2007 17:31S1.65311.65340.00031
15.5.2007 19:44F1.65211.65340.00132
15.5.2007 22:28AC1.65191.65340.00151
16.5.2007 09:19AC1.65281.65340.00061
  • #113
  • May 16, 2007 1:40pm May 16, 2007 1:40pm
Today there were lots of news influancing on the market causing strong impulses somewhere expected , somewhere - not

During such volatility periods trader must keep his eyes fully opened because could miss appropriate moment for action which is almost immediately penalized by the market. You can see the result on the chart below.

My absence of mind today ended with a $ -1 800 loss that hapily might be profit

Fortunately the opposite situation exeists - look here
Attached Image
  • #114
  • May 16, 2007 10:59pm May 16, 2007 10:59pm
Hi ISTO !

GREAT JOB, MAN...!
I'm glad to see your thread here and also your nice blog, as I was reading BILL's book and I had some problem in understanding teqs, also I really needed some live examples...
I just say thank you and will follow your analyzes...
  • #115
  • May 17, 2007 12:43am May 17, 2007 12:43am
Quoting Invincible
Hi ISTO !

GREAT JOB, MAN...!
I'm glad to see your thread here and also your nice blog, as I was reading BILL's book and I had some problem in understanding teqs, also I really needed some live examples...
I just say thank you and will follow your analyzes...
Thank you Invincible, I'm glad my postings are useful...
  • #116
  • May 17, 2007 2:12am May 17, 2007 2:12am
There is time to take actions; thire is time to stay aside watching.

As the chart shows Alligator is closing (so is Gator). Price is moving in opposit directions forming fractals. Momentum is also down.

There is an exit level formed on the chart (marked red) - where we have two closed below the pink line

So trader have to collect his profit and look for another place, or at least have to tighten the stops...

Why? if you need more arguments - look here
Attached Image (click to enlarge)
Click to Enlarge Name: eurgbp-20070517-10.gif Size: 16 KB
  • #117
  • May 17, 2007 3:00am May 17, 2007 3:00am
The news yesterday makes GBPAUD (post #99) to stop and hesistate what to do next.

Promising fratal break and bullish DBar faded away and it seems to be better to stay away for the moment.
Read more arguments here
  • #118
  • May 17, 2007 3:54am May 17, 2007 3:54am
USDJPY is the last trade survived open after the hassle signals issued lately.

As seen on both H4 and Daily chrats bellow there is cosensus about the move:

  1. Alligator is hunting (lines are opend)
  2. Momentum is up
  3. Acceleration is up (no true for the last H4 session)
  4. Bullish fractals has been taken.
  5. we are in the Zone

Will this trade survive? (In any case I've tightend the stops )

Attached Image (click to enlarge)
Click to Enlarge Name: usdjpy-daily-20070517.jpg Size: 87 KB
  • #119
  • May 17, 2007 7:28am May 17, 2007 7:28am
Isto, I was checking all your charts with details... it seem you use some useful indicators in MT( except Aligator, AO, AC and gator). Maybe not good to ask you, but if you don't mind would you let us to use them too? ( such as ZONE and the points)...
It will help me a lot
  • #120
  • May 17, 2007 8:23am May 17, 2007 8:23am
Quoting Invincible
Isto, I was checking all your charts with details... it seem you use some useful indicators in MT( except Aligator, AO, AC and gator). Maybe not good to ask you, but if you don't mind would you let us to use them too? ( such as ZONE and the points)...
It will help me a lot
Hallo Invincible

These, you see on the charts, are just the same signals I've described but because I do lots of things concurrently I need some alerts to draw my attention to the chart.

I do not beleve to "black box" things telling me when and how much to enter or exit the market. This leeds to loss only. If you do not understand what are you doing even the best indicator or expert won't help you make profit.

So I sit on my ... chair and scribbled an indicator

I also used to hunt tools previously to beat the market with, but the market proved (painfully for ) me that the best tool is my mind - no one else could help me.

I'll quote by hart B.Williams - "We trade our believes"

This is why I did not offer this indicator up to know.

Another reason is that all this is still under development. There are some thing to be mastered. When ready (hope soon) and if results are satisfying I'll consider some sort of distribution if there is any interest of it.

For the moment I'm not ready to do this because (you could see around) there are lot's of complains, improvement suggestions and so on which I cannot neither answer nor deal with.

Finally - writing of an indicator is not hard - creating the system is....
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