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Pivot Point Squeeze, high probability system

  • #441
  • Dec 22, 2007 2:29am Dec 22, 2007 2:29am
Hi,

Many thanks to GCTrader1 for converting Mr Bollingers Theories into a system & FXHermit for conversion to MT4.

Having read Mr Bollingers book some years ago, it seems although you have the 'squeeze' method well and truly sorted . But i feel this is only 50% of what his system/your charting is capable of doing. You have come this far so why not go for the 100% system.This being the opposite to the squeeze.
If you monitor your great charts you will notice that when the Bands significantly widen and then start to move towards each ofter,(which can be monitored via Bandwidth indicator) the market goes into trading range. This is then open for Range type trading methods.

So using your charting

bandwidth low = squeeze trading
bandwidth high = range trading


Your thoughts !!!!

nightpipper (novice)
  • #442
  • Dec 22, 2007 3:17am Dec 22, 2007 3:17am
Quoting nightpipper
Hi,

Many thanks to GCTrader1 for converting Mr Bollingers Theories into a system & FXHermit for conversion to MT4.

Having read Mr Bollingers book some years ago, it seems although you have the 'squeeze' method well and truly sorted . But i feel this is only 50% of what his system/your charting is capable of doing. You have come this far so why not go for the 100% system.This being the opposite to the squeeze.
If you monitor your great charts you will notice that when the Bands significantly widen and then start to move towards each ofter,(which can be monitored via Bandwidth indicator) the market goes into trading range. This is then open for Range type trading methods.

So using your charting

bandwidth low = squeeze trading
bandwidth high = range trading


Your thoughts !!!!

nightpipper (novice)
Good call except for now I see at least one thing wrong or making it difficult to use at least.
However, I agree, doing fast forward tests through historical data really brings this up as you often see the price retrace to the major trend and in the between stay usually between higher or lower part of the area between the bands.

One problem I see is: your max bandwidth will change a lot so how will you determine if the breakout is over? Higher tf bollinger bandwidth might give you an idea when it's expanding contracting but you cant always tell how fast it can change so when you think a breakout is over it might just have a bigger pullback and then explode, or oppositely change trend direction.
Not sure if what I said makes sense it's a bit late here again.

I should probably get some sleep one of these days I went to sleep at 10am yesterday for 4-5 hours and been doing about the same for the past week including a couple all nighters...GCT your system and the mkt behind it is addicting haha
  • #443
  • Dec 22, 2007 3:28am Dec 22, 2007 3:28am
Just throwing out another idea for everyone and GCT and Alexish if you feel up to it backtest wise.

Especially during recent days most of the big breakouts were during or right before the London open, GCT what if you restricted the time when the signal would be valid, say a range of hours for example some before the open and half way into the day? This would exclude some range trading false signals that simply hit some new highs and usually retrace back into the range until those hours, or not to exclude too many trades if there are in fact a good number, wait for a second confirmation bar of bandwidth increase.

Let me know what you think, this would be interesting to check using back tests see if it eliminates false entries and how many. Sorry guys directing this at you since I haven't started mt4 scripting...yet :-) Maybe between x-mas and new years while the market will still be unavail. more or less we'll see.
  • #444
  • Dec 22, 2007 4:04am Dec 22, 2007 4:04am
Quoting nightpipper
Hi,

Many thanks to GCTrader1 for converting Mr Bollingers Theories into a system & FXHermit for conversion to MT4.

Having read Mr Bollingers book some years ago, it seems although you have the 'squeeze' method well and truly sorted . But i feel this is only 50% of what his system/your charting is capable of doing. You have come this far so why not go for the 100% system.This being the opposite to the squeeze.
If you monitor your great charts you will notice that when the Bands significantly widen and then start to move towards each ofter,(which can be monitored via Bandwidth indicator) the market goes into trading range. This is then open for Range type trading methods.

So using your charting

bandwidth low = squeeze trading
bandwidth high = range trading


Your thoughts !!!!

nightpipper (novice)
Hey Nightpipper,

Way ahead of ya mate, already started coding weeks ago but finding it alot more difficult to code a trading plan that is as profitable as the squeeze.

The squeeze is a lot clearer than the reverse squeeze, or expansion. The problem with the bollinger band expansion is that while the bollinger band is a bell curve, it is a moving bell curve. So while the probability of the price closing at the edge of the bollinger band is low, during a trend it is higher. Its probability of snapping back to say the opposite band profitably and in a timely manner is inversely proportional to the time spent expanding. So quick snaps like a news event can trigger a a nice trade in the opposite direction of the initial spike from the news.

Any ways, im tired, dont think im making any sense so catch you all tomorrow!

GCTrader
  • #445
  • Dec 22, 2007 5:53am Dec 22, 2007 5:53am
Quoting jonaslt
Good to know I had it right hehe, thanks again for all the coding.

"Tregger line is variable", I know I can set them, but what I meant is according to Bollinger as GCT discussed earlier with bibls I believe (sry if I chopped your name up), the trigger line is based on the low of the last 132 bars, I wondered if it wouldn't be too hard to code that so it would change auto if you were up to it because then you could use this indicator on any pair and tf without changing the trigger line since it always changes according to the low.
This would eliminate the need to always change the trigger on the same pair as well if it was passed under during the last 132 bars.

I think I wrote it wrong the first time, what I meant by variable is changing by itself not a set variable thats modifiable.

Sorry for the confusion
Ok! I will change code for auto Trigger line calculation.. Thanks for advice!
  • #446
  • Dec 22, 2007 6:28am Dec 22, 2007 6:28am
Dont ask why im still up, my god i need sleep! More code for everyone. This auto updates your TP levels on the main chart so you can keep an eye on how much money your making. lol


TPAUTOADJUSTBETA

 -----------------------------------------------------------------------

trigger = call squeeze [A, C, PERIOD]

PP = (DHIGH(1) +DCLOSE(1) + DLOW(1))/3

rtwo=(pP+dhigh(1)-dlow(1))

rone=(pP*2)-dlow(1)

sone=(pP*2)-dhigh(1)

stwo=pP-dhigh(1)+dlow(1)

if trigger = 1 and close>pp and close<rone then

tp1 = rone
tp2 = rtwo

endif

if trigger = 1 and close>sone and close<pp then

tp1 = pp
tp2 = rone

endif

if trigger = 1 and close>stwo and close<sone then

tp1 = rone
tp2 = pp

endif

if trigger = 1 and close>pp and close<rone then

tp1 = rone
tp2 = rtwo

endif

if trigger = -1 and close<pp and close>sone then

tp1 = sone
tp2 = stwo

endif

if trigger = -1 and close<sone and close>stwo then

tp1 = stwo
tp2 = sTWO

endif

if trigger = -1 and close<rone and close>pp then

tp1 = pp
tp2 = sone

endif

REM if trigger = 0 then
REM tp1=pp
REM tp2=pp
REM endif


IF PP<>PP[1] THEN
TP1=PP
TP2=PP
ENDIF


RETURN tp1 COLOURED (200,300, 0) AS "First TP", tp2 COLOURED (0,0,167) AS "Second TP"

----------------------------------------------------------------------

Levels accentuated for your viewing pleasure

http://img525.imageshack.us/img525/9...xeurjpyom4.png
  • #447
  • Dec 22, 2007 6:42am Dec 22, 2007 6:42am
Or cut it all down and have it simple! Yellow is first TP, Blue is the second TP... Work in progress

http://img528.imageshack.us/img528/2...xeurjpykx4.png
  • #448
  • Dec 22, 2007 1:11pm Dec 22, 2007 1:11pm
Can someone tell me how to make my indicators into histogram?

thnx
Attached Image (click to enlarge)
Click to Enlarge Name: eurjpy.png Size: 33 KB
  • #449
  • Dec 22, 2007 1:21pm Dec 22, 2007 1:21pm
When applying the indicator to the chart, on the right hand side of the indicator windows - I think where it has the lines, if you click on that it will drop down and give you options for histo.

Hope this helps.
  • #450
  • Dec 22, 2007 1:48pm Dec 22, 2007 1:48pm
"DUH" on my part!

thank you!



Quoting guess121
When applying the indicator to the chart, on the right hand side of the indicator windows - I think where it has the lines, if you click on that it will drop down and give you options for histo.

Hope this helps.
  • #451
  • Dec 22, 2007 4:15pm Dec 22, 2007 4:15pm
Just took some hours to go over the Bollinger On Bollinger book and must say for anyone trying this technique, it is definately worth a read to understand fully what is going on here and how to trade the breakout more effectively besides just using what's given here.

GCTrader,
just wondering if you tried any other indicators besides MACD for this, he names off a whole list, wondering if you tried any others in terms of effectiveness. I know the whole volume part cuts out since we don't have it but RSI etc.?

Another idea I had was applying the bollinger bands to the ratio we get already as well as a separate indicator with RSI to see where it's oversold/overbought.
Using these looking at the top of the range where it's oversold at the peak of the breakout and at what variable levels, we should have an idea where it will turn around, especially if we get a confirmation with a downsloping/upsloping RSI.
This could be used to indicate the reversal of the breakout and go the other way until it consolidates more and goes into a ranging mode.

Let me know if it makes sense, I want to try this on mt4 myself just have to get a little more savvy with the charts and will let you know if I come up with anything.
  • #452
  • Dec 22, 2007 5:29pm Dec 22, 2007 5:29pm
Hmm, looking at the charts, now I'm thinking that theory is a little off.

In this case, the reversal,continuation is when RSI is outside the bollinger bands and starts returning...this could actually be used as a exit strategy (opposite sloping RSI outside the BB on big breakouts)

Still trying to see if bb applied to the ratio would give us any extra information.
  • #453
  • Dec 22, 2007 5:51pm Dec 22, 2007 5:51pm
Quoting jonaslt
Just took some hours to go over the Bollinger On Bollinger book and must say for anyone trying this technique, it is definately worth a read to understand fully what is going on here and how to trade the breakout more effectively besides just using what's given here.

GCTrader,
just wondering if you tried any other indicators besides MACD for this, he names off a whole list, wondering if you tried any others in terms of effectiveness. I know the whole volume part cuts out since we don't have it but RSI etc.?

Another idea I had was applying the bollinger bands to the ratio we get already as well as a separate indicator with RSI to see where it's oversold/overbought.
Using these looking at the top of the range where it's oversold at the peak of the breakout and at what variable levels, we should have an idea where it will turn around, especially if we get a confirmation with a downsloping/upsloping RSI.
This could be used to indicate the reversal of the breakout and go the other way until it consolidates more and goes into a ranging mode.

Let me know if it makes sense, I want to try this on mt4 myself just have to get a little more savvy with the charts and will let you know if I come up with anything.
Did someone say volume is out??? Volume we have, if you pay...

http://img337.imageshack.us/img337/4...jpyspotso9.png

Volume dropping off on the trade from friday, which is what you would expect leading up to the end of the week. It also could mean the movement is over. I exited before close of trade.

GCTrader
  • #454
  • Dec 22, 2007 6:16pm Dec 22, 2007 6:16pm
Quoting GCTrader1
Did someone say volume is out??? Volume we have, if you pay...

http://img337.imageshack.us/img337/4...jpyspotso9.png

Volume dropping off on the trade from friday, which is what you would expect leading up to the end of the week. It also could mean the movement is over. I exited before close of trade.

GCTrader

Do you use volume to identify fake outs at all before the breakout...is there any difference in the data on lower tf between the two? Huge spikes on low tf before a breakout as opposed to gradually increasing as the breakout goes or something like that.

Thanks GCT
  • #455
  • Dec 22, 2007 6:32pm Dec 22, 2007 6:32pm
Jon,

There does seem to be a correlation between an increase of volume at a signal and fewer fake-outs. I have just wrote another code to include this volume and take it into account. Looking good so far, but as always, code can be a grind to perfect! Volume indicator seems to be worth the money. Let you know the results...

Lower timeframes can enter you into a position sooner, but tends to yield more head-fakes. I have multiple timeframes up for the euroyen and aussie to keep an eye on the general, longer term squeeze and the shorter term entry.

GCTrader
  • #456
  • Dec 22, 2007 7:04pm Dec 22, 2007 7:04pm
Hello guys! Let's try new Bband Squeeze v4 with autimatic Trigger Line calculation (GCTrader1 metod) and Arrow alerts of signals in main chart window.. Errors? Please let me know! Many pips for you my frends!!!
Attached File(s)
File Type: mq4 Bands_Squeeze_v4.mq4   10 KB | 769 downloads
  • #457
  • Dec 22, 2007 7:15pm Dec 22, 2007 7:15pm
Quoting ALEXISH
Hello guys! Let's try new Bband Squeeze v4 with autimatic Trigger Line calculation (GCTrader1 metod) and Arrow alerts of signals in main chart window.. Errors? Please let me know! Many pips for you my frends!!!
My mouth is watering! Wish i could have a look...pictures please! Since your a coder Alex, what did you think of the auto TP levels?

GCTrader
  • #458
  • Dec 22, 2007 7:17pm Dec 22, 2007 7:17pm
I will be posting an updated system outline with all code in a pdf after chrissy. The thread is getting rather long and alot of valuable information has been vented. Should be an interesting read after all the input from everybody.

GCTrader
  • #459
  • Dec 22, 2007 7:30pm Dec 22, 2007 7:30pm
Quoting ALEXISH
Hello guys! Let's try new Bband Squeeze v4 with autimatic Trigger Line calculation (GCTrader1 metod) and Arrow alerts of signals in main chart window.. Errors? Please let me know! Many pips for you my frends!!!
I think we might have a problem, but I'm not 100% on how you coded it, I tried looking at it, but on my graph the lowest was say .0034 but the limit is still .0043, don't think it got smoother or anything, maybe look low of different tf or something? No clue.

Attached Image (click to enlarge)
Click to Enlarge Name: Untitled-1.gif Size: 53 KB
  • #460
  • Dec 22, 2007 7:37pm Dec 22, 2007 7:37pm
Quoting jonaslt
I think we might have a problem, but I'm not 100% on how you coded it, I tried looking at it, but on my graph the lowest was say .0034 but the limit is still .0043, don't think it got smoother or anything, maybe look low of different tf or something? No clue.

Attachment
Looks right, what TF are you using? I use a 38 sample period. Seems to work the best even when I take it back 3 years!

GCT
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