Profitunity (Chaos) Trading System by Bill Williams

Not yet. It depends whether 3AO will be taken

Well but actually if price go on this leve, it will be taken. So i suggest you to put signal lower... and also another point... this level is Level of support... and if it is taken... then price will go lower. this is just 1 situation that may happen....

Okey lets get back to our chickens

On this chart today happened a GAP and all profitable possitions turned to losses. How i hate that GAPS!!!!! Okey but chart hitted my stop and i turned on the short side... from 35.25 with 1 lot... and later on 35.15 got 4 more lots... now i have 5 lots on short side. what will happen next i dont know... Actually we need more information.

Okey another chart (blue chip ROSN).

Here we have a tripple top... and if price will brake level 219 i will surely open stops.

And finally blue chip GAZP

Here i had stop sell on 285.8... and it was triggered.. but now price is going higher.... i think i made a mistake that put stop sell so high... i should put it somewhere lower than 215... But any case i have 20 stock of it now... and will wait.... stop loss is on the high.....

Aha and also i can see here a tripple top and both AC and AO are going down.... So i think Support will be broken! And also on the head we had a Bearish DB

Any comments?

Previous session diving hit stop loss causing some loss.

Let's see 1.3755 support how strong is

Isto i think this support level is very hard to get... but with some luck and of course information... price will get it... and then i think you could open short position with 3 lots Just my thoughts

hi isto,
Great trading system, i want to know that on post#2 you posted the image of USDCHF chart. In the chart, The Yellow line which indicator is that.

thanks.
khawaja

it's probably some MA but I'm not sure... it is not Chaos indicator...

if you find out excatly which MA it is, pls do let me know.

thanks.
khawaja

if you find out exactly which MA it is, pls do post it.

thanks.
khawaja

200 perhaps - I really don't know. This is an old chart and I do not use other MAs that Alligator for it does not make sense with the system...

thanks anyways!.

Hi isto,

Thank you for your detailed explanation.... It really helps...
I feel you are a Master Trader.... You are not only expert in Chaos system
But you have indepth knowledge of trading principles.
Thank you .. Pls carry on your crusade to help others...


regards
tej

Here NZDJPY on daily chart offers a nice trade puzzle

From the one side we have bunch of Bearish Divergent Bars versus a Bullish Fractal on the other;

Double tops versus Green Zone (Strong Momentum and acceleration up)

Let's see where will go next

Hi isto,

As per our discussion yesterday about the Divergent bars.
I finally made a decision to follow the signal as per the system
and went short below the low of the Bearish Divergent bar and place a stop loss few ticks above the top of the Bearish d bar.

But today market has given us new information by forming a Bullish Divergent bar.

I need your help to analyse this new information provided by the market.

My current dilemma is how to make use of this new input . I am having following doubts, Please guide which is correct. If all are wrong pls give your answer, i.e. what should one do in such condition.

i) Close short position, if mkt trades above the Bullish Divergent bar

ii) Close short position and reverse the trade , if market trades above Bullish d bar

iii) Nothing has changed, maintain the old stop loss. i.e. on other side of Bearish Divergent bar.

iv) If price crosses the top of bearish divergent bar, then close and reverse the position , bcoz that will also be a balance line signal.


awaiting your guidance
regards
tej

Tej

i would prefer 3 variant.... becos Bullish DBar is invalid.

Hey Isto

Ihave some questions about your last chart. On your chart you had some more Bearish dabrs earlier.... but you didnt react on them.... why? becos they are invalid?

Okey if they are invalid lets imagine situation that they are valid.... and they are triggered and then chart goes higher again.... this mean i will close my long position, open short... make a small loss... and than again open long but with small position becos 1 signal..... If this is true, than we will lose a huge amount of profit....

Well as promised (to isto) here is what I have found works for me:

I have found that working on the 15 minute and longer timeframes using ONLY AO and AC I am making far more consistent profits than I ever have using the system as a whole as detailed in Trading Chaos Second Edition.

I find that identifying the divergent bars is a very subjective thing i.e. is there an angle between the divergent bar and the Alligators teeth / jaw? Is there enough angulation? I'm never sure.

Anyway - according to the book - the AO is the best indicator around and, although it is NOT recommended by Bill and Justine Williams to use this indicator on its own, they also say that using this indicator correctly 'should be worth at least seven figures to you in the next few years'.

I think the reason for making the divergent bars the first entry point is to get you into the trend reversal early to maximize profits. My problem is that I don't really care whether the profits are maximized - just as long as I am making consistent profits - and this seems to be working nicely for me.

All I am doing is trading the Dow, S&P, Nasdaq, and DAX using AO and AC (the 15 minute charts seem to be the best for me because I am one of those traders that needs to be trading all day every day otherwise I don't feel like I have a job). Basically - I have the AO and AC open on my chart - and place a market order to buy the moment the new bar changes from red to green and place a market order to sell the moment the new bar changes from green to red. I hold on to the positions - no matter what - until the very first 'contradictory' bar changes color on the AC. That's it.

The trick to this is that on the shorter time frames I have found that both Metatrader and my other brokers' trading platform may present the wrong color AO and AC bars the instant that the new bar appears (I think it has to do with the immediate opening price). The way I get around this is I wait for the new bar to appear and then just hit 'refresh' a couple of time until I am sure that the bar is not going to change color and then, depending on the 'constant' color, I open my position (this is tied to a previous problem that I described where fractals 'disappear' i.e. the platforms draw the fractal BEFORE the second bar to the right of the fractal bar has closed and if the price then goes in the same direction of the fractal at any point while drawing the third bar the fractal disappears).

Also - I wait until there is a nice 'high' or 'low' saucer formed before opening a position i.e. sometimes the saucer (or oscillator) is just above or below the zero or middle line - I stay away from those. I know the height of the saucer or oscillator is purely dependent on price BUT the way I interpret things - the 'higher' or 'lower' the top of the saucer or oscillator - the greater the 'conviction' of the traders and the stronger the movement will be in the opposite direction.

My main problem with the entire system as detailed in the second edition of the book is the fact that EVERY SINGLE TIME a fractal signal is taken there is an immediate retractment. I contacted Justine Williams about this and she said to place your stop orders a little further away from the fractal to avoid the order getting 'falsely' executed but I started to find that no matter HOW far away from the fractal I placed an order it somehow ALWAYS got executed and then the price would retract. I tried everything - including placing a buy stop order below a fractal when the system was telling me that I should be placing a sell stop order etc. etc. but most times I was wrong and then lost money by getting stopped out. I also tried using fibo and pivot points - just to 'unsure' for me.

Anyway - look here: