Old Benjamin was right
Spud's Predictive MTF Stochastics 1,695 replies
LFB System - London Fib Breakout 45 replies
Fib 4Hour MTF Moving Average 287 replies
Journal related to: Spud's MTF Stochastics 178 replies
Spud's PVX Method 25 replies
DislikedThe chart below is from March 1st 2007.
The first thing to notice is that at the break at the first break at 100 we did not jump in. Honestly, it wouldn't matter if we did as our losses would be insignificant because we'd bail out soon after once the 1H stochs dived below 76.3 However, the 30M stochs are saying this is a no good trade because they are both falling.
More significant is a little later on where the "short entry" arrow is pointed. Notice price has crossed and closed below 100 on the Fib level after having been above it.
The 1H stochastics are at 38.2 (5,3,3) and 76.4 (14,3,3)....nice how that works out.
The 30M stochastics are at 38.2 (5,3,3) and 50 (14,3,3).....I'm not making this up!
What is also really important is that both sets of stochastics are moving down.
Now, just like our MTF stochastics where the stochastics love to move from 80 to 20 or 20 to 80.....so our price loves to move on the fib scale from 100 to 0 and 0 to 100.
The 4 most common moves of price and fib are (in no particular order):
1. Break 100
2. Break 0
3. Move from 100 to 0
4. Move from 0 to 100
The MTF stochastics nicely present us with which move price will make.
So as we move along the chart the stochs hit 23.6. In MTF stochastics this would be an exit (at 20).....but now that we have the Fib we now are going to stay in unless our 14,3,3 on the 1H rises above or hits 23.6.
You can use the 30M 14,3,3 rising above or hitting 23.6 as an exit...but in the long run...14,3,3 is much better.
Now..moving along..our price breaks 0 and our stochs are below 23.6...so now we either ride the break or enter a new trade for the break at 0.
As said we exit when the 14,3,3 hits or rises above 23.6. We don't have to be ultra picky on this...you can anticipate...you can wait until you see a definite cross....or you can exit a little earlier. We can use our MTF stochastic knowledge to try and find this moment....but the moment is around the 14,3,3 crossing 23.6!
200 pips to play with here...so lots of room if you don't get the entries and exits bang on.Ignored
DislikedWhen price moves 2 levels on the fib it is common for the price to continue in that direction (123.6 to 76.4)....I don't use this as a hard and fast rule but it is a check mark towards entry.
2 levels because price went initially above 100 then crossed back. if that fakeout did not happen and just went to 100 would you still count that as 1 level for the second level at 76? i.e if just touch 100 and then down to 76, would you have shorted?
Arguably and I forgot to mention that you could trade the long from when both stochs crossed the 23.6....my decision in not doing so was simply because I was asleepIgnored
DislikedSpud, in a case such as that shown in this chart, is a re-entry called for?
Thanks,
Lou GIgnored
DislikedWhat an interesting approach, Spud! Attached is an indicator to draw the fibs both above and below based on the previous day high/low. My broker shows the last 2 hours of Sunday so the indicator is coded to use Friday high/low if today is Monday. It may barf when Monday is a market holiday (as it was this year on Christmas and New Years) but I'll cross that bridge when I get there.
If I get time, I'll add the actual prices to the levels and possibly combine Sunday data with Friday just in case a new high/low is created on Sunday.
Feel free to modify/improve this - if you do so, please share...
Lou GIgnored
DislikedThanks for all your efforts spud. Just 1 question. The first short trade on the chart shows price on Stock 1h and 30min above the 23.6 But you previously said stoch had to be breaking through the 20 level (now the 23.6). As long as stoch is trending down is this still a trade above 23.6?
ThanksIgnored
DislikedSpud told us to add a separate M30 stochastic below our H1 price and stochastic chart. During live trading this is easy to let both charts move forward with auto scroll. But, when backtesting you must pull both charts forward or back separately to line up the time frames (or use F12, Shift F12). Does anyone know if it is possible to have a combined chart with both stochastics at the bottom. Or is there a better way in MT4 to accomplish moving both charts forward or back one bar at a time simultaneously?Ignored
DislikedOfftopic,
but the polyphasic sleep, Ive just googled and found a wiki entry, I shall read more. I had never heard of it. I knew that dolphins, ducks slept only with one side of their brain, while the other side was mentally active.
I had wondered if humans too, had this ability, or could learn this ability(i suspect we can). So thanks for the heads up regarding polyphasic sleep. It's certainly needed to trade forex lolIgnored
DislikedNot specifically. What I've done (and this is simplistic) is comment the value of the 30Min stoch in an EA. I always take the easy way first.Ignored
DislikedMore significant is a little later on where the "short entry" arrow is pointed. Notice price has crossed and closed below 100 on the Fib level after having been above it.Ignored
DislikedGreetings.
I have searched the thread, and don't think this question has been answered:
Do you ignore stoch crosses, and use only closed bars for the Stoch signal? I noticed you said to use closes for fibo breaks a few times, but never saw anything for closes on Stochs.
Thanks.Ignored
DislikedHi Lou,
I like how it uses two colors for upper and lower levels, but shouldn't we add the inner levels? And the High/Low calculation didn't work to well for me. I simplified it and tested it on Alpari and IBFX (for sunday candles). Let me know what you think.
And of course a big Thank you to Spud, for sharing this with us!Ignored