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Getting rid of indicators

  • #1
  • First Post: Edited Jan 14, 2008 5:08am Jan 12, 2008 10:04pm | Edited Jan 14, 2008 5:08am
Hi, I was working on some improvements on my system that uses gann hilo, and I did some changes, discarded QQE (its not a bad indicator, but makes me enter a little bit late on some trades, as result some times I have to leave 100 Pips sometimes more on the table) and discarded ADX as well.

Those changes maked me catch more 100 to 200 pips on each good trade, also some trades that where negative turned positive, because of a better entry and exit.

But it also creates more setups in ranging time that end up eating some of my pips, Unfortunately for me, when its ranging time, its an entire month or even more.

To make a point here, most of my winners are from 200 to 1500 pips
My losers never go more that 150 pips, and if I need to put a larger Stop Loss, I just decrease my position sizing.

Well, all the twekings I have done gave me more pips on my good months, but have add more losses to my bad months also.

But I just Know I can reduce those losses by filtering those bad setups, I have tried almost all kind of indicators to do so, but most off them, corrected those bad entry's, but make me entry late on most of my good trades ( I trade 4H bars, one bar latter and I lose more than 100 pips), witch is why I have discarded QQE and ADX.

I know the answer is not lying in any indicator it is lying in price, but how can discover the truth? I'm going to post some Charts that demonstrate my problem.

I hope someone with more experience than me, in price action can give me some clues here.

Best regards MASMP_FX
Logic will get you from A to B. Imagination will take you everywhere.
  • #2
  • Jan 12, 2008 10:07pm Jan 12, 2008 10:07pm
Most of those trades where previously filtered by DMI, and QQE.
In this image I lost 125 pips, not a big deal
Attached Image (click to enlarge)
Click to Enlarge Name: range time.gif Size: 28 KB
Logic will get you from A to B. Imagination will take you everywhere.
  • #3
  • Jan 12, 2008 10:13pm Jan 12, 2008 10:13pm
The blue line is Gann Hilo at 10, and Orange Line is Gann Hilo at 3 and other indicators discarded, I have gained an extra 130 pips on the setup, and more 100 pips on the Exit, witch turned a previous +295 pips trade into a +515 pips profit
Attached Image (click to enlarge)
Click to Enlarge Name: improvement time.gif Size: 21 KB
Logic will get you from A to B. Imagination will take you everywhere.
  • #4
  • Jan 12, 2008 10:17pm Jan 12, 2008 10:17pm
What have came to my mind, is some kind of tunnel between price, if price is playing in that tunnel, don't trade, but how can I do that?
Logic will get you from A to B. Imagination will take you everywhere.
  • #5
  • Jan 12, 2008 10:31pm Jan 12, 2008 10:31pm
...and simple! How about an EA someone???
"Loss and failure are inevitable but misery is optional"
  • #6
  • Jan 12, 2008 10:37pm Jan 12, 2008 10:37pm
Quoting carmel
...and simple! How about an EA someone???
That post doesn't answer my question... but no problemo
Logic will get you from A to B. Imagination will take you everywhere.
  • #7
  • Jan 12, 2008 10:55pm Jan 12, 2008 10:55pm
Wow, you mean others use bar charts? I would be interested is seeing more bars from your examples... I can't get a feel of the price action with the charts you have posted...
Check Mate GAME OVER
  • #8
  • Jan 12, 2008 11:03pm Jan 12, 2008 11:03pm
http://img258.imageshack.us/img258/4254/barsqd2.png

This chart I can get a little feel for... I see a choppy pair running in a range with a false break to the down side. Followed by expansion in volatility to the upside. Look at the daily...
Check Mate GAME OVER
  • #9
  • Jan 12, 2008 11:06pm Jan 12, 2008 11:06pm
Charts In Candlesticks
Attached Image(s) (click to enlarge)
Click to Enlarge Name: range time.gif Size: 37 KB
Click to Enlarge Name: improvement time.gif Size: 21 KB
Logic will get you from A to B. Imagination will take you everywhere.
  • #10
  • Jan 12, 2008 11:19pm Jan 12, 2008 11:19pm
Sorry I can't help with candle charts.. I bet some candle people can jump in
Check Mate GAME OVER
  • #11
  • Jan 12, 2008 11:54pm Jan 12, 2008 11:54pm
Quoting bunton
http://img258.imageshack.us/img258/4254/barsqd2.png

This chart I can get a little feel for... I see a choppy pair running in a range with a false break to the down side. Followed by expansion in volatility to the upside. Look at the daily...
That would have been a nice setup commonly referred to as a box play. Bracket the upper and lower trend lines with a buy stop + 1 pip above and sell stop - 1 pip below the box to stop you into a trade. Then whichever way the trade goes an exit target would be equivalent to the width of the box added to entry. And remember to cancel the other original stop which wasn't executed - in this case the buy stop.
  • #12
  • Jan 13, 2008 12:19pm Jan 13, 2008 12:19pm
Quoting Masmp_FX

I know the answer is not lying in any indicator it is lying in price, but how can discover the truth? I'm going to post some Charts that demonstrate my problem.

I hope someone with more experience than me, in price action can give me some clues here.

Best regards MASMP_FX
You are absolutely right. The answers is not in indicators. I think you have started with the first step in discovering the truth yourself by accepting the fact about indicators.

It took me one year to be able to do away with indicators. They no longer have a place in my trading decisions.

My Clues:

The next thing is that if you discarded indicators you must have something to fall back to as alternative. You cannot trade blindly on the chart.......I will suggest using pivot systems or levels.

Having decide on pivot level, you must study what people call price actions around these pivot levels. I call it market behaviours. If you find time to study the market, you will soon discovered that market behaviour is deterministic way around pivot levels to certain degree contrary to general popular believe.

After you are now confident with your observations/study you will then be able or ready to use the knowledge to trade off pivot levels knowing fully well how market will behave at each level, each hour, each day, week, month and so on.

There will be no need for a live "a box play" strategy if market fails to behave the way it should at each of your levels......because that failure is abnormal behaviour that can be avoided.

Indicators do not know how to respond to failures, abnormal behaviours, false breakouts, etc. This is what makes strategy based on market behaviours more reliable. It is less stressful to spot abnormal behaviours (beak out), decide to avoid them or trade them, without feeling that the market is leaving you behind.

Just my 2cent. I am not that experienced like most other people here.
  • #13
  • Jan 13, 2008 12:32pm Jan 13, 2008 12:32pm
Get rid of indicators but then use pivots? What do you think pivots are. A calculation of previous levels. And what are indicators - calculations of previous levels.

+ + +

If market fails to behave the way it should cane be the same as breaking out of a box. That is if one cares to look at that way. Suit yourself.
  • #14
  • Jan 13, 2008 12:51pm Jan 13, 2008 12:51pm
Quoting SunTrader
Get rid of indicators but then use pivots? What do you think pivots are. A calculation of previous levels. And what are indicators - calculations of previous levels.

+ + +

If market fails to behave the way it should cane be the same as breaking out of a box. That is if one cares to look at that way. Suit yourself.
The truth seems to be that pivot points that are calculated tend to work, but works even better are TRUE PIVOTS. Try zooming out in time, and you will see what I mean.

The attached CHF/JPY is a blatant example of this. True, most pairs aren't this dead obvious, but this shows my point quite well.

Lower leverage, longer time frames......the path to riches.
Attached Image
  • #15
  • Jan 13, 2008 12:51pm Jan 13, 2008 12:51pm
How about utilizing SMA/EMA along with FIB's on the higher TF's? I also did away with most of my indicators and saw a huge improvement in my trading. I also started trading higher TF's (Daily).
Humble Lifetime Member
  • #16
  • Jan 13, 2008 1:04pm Jan 13, 2008 1:04pm
Quoting SunTrader
Get rid of indicators but then use pivots? What do you think pivots are. A calculation of previous levels. And what are indicators - calculations of previous levels.

+ + +

If market fails to behave the way it should cane be the same as breaking out of a box. That is if one cares to look at that way. Suit yourself.
No Sir, pivot levels ak.a support and resistance are not the same as technical indicators, especially in applications. MT4 help section give sufficient literature on the differences between support/resistance and technical indicators. If they are the same they would have been grouped
together.

People look at market in different ways - that is why we have different results whether it suits you or not. I think that is why this place is a public forum and people are free to express their opinions which may not always suit you whether you like it or not.
  • #17
  • Jan 13, 2008 1:19pm Jan 13, 2008 1:19pm
Quoting fxbroker
No Sir, pivot levels ak.a support and resistance are not the same as technical indicators, especially in applications. MT4 help section give sufficient literature on the differences between support/resistance and technical indicators. If they are the same they would have been grouped
together.

People look at market in different ways - that is why we have different results whether it suits you or not. I think that is why this place is a public forum and people are free to express their opinions which may not always suit you whether you like it or not.
I think it is a matter of definition. "Pivot Levels" in my mind are "Daily Pivots" i.e. (H+L+C)/3. "Pivots" or "Swing Pivots" are pure and simple right on the chart. Daily Pivots are another form of indicator. So if you are referring to points on a chart you are correct they are not indicators in that sense.

As far as my reference to a box play, you gave your opinion and I gave mine back. Like you say it is a public forum and that is what a market is. A market of opinions. Besides my comment about a box play was to bunton.
  • #18
  • Jan 13, 2008 1:25pm Jan 13, 2008 1:25pm
I think there is one point being made...the sooner you stop using indicators the sooner you will become a good trader........relying on price action and learning that it is a repeating pattern....find 1 or 2 or 3 that you recognize over and over again and trade them.....as far as pivot points, they are a self fullfilling prophesy because so many traders are aware of them......but the Mathamatics of Fibonacci is how the currency moves...sometimes the pivots line up with it.......
  • #19
  • Jan 13, 2008 1:30pm Jan 13, 2008 1:30pm
Quoting Learntocount
....as far as pivot points, they are a self fullfilling prophesy because so many traders are aware of them......but the Mathamatics of Fibonacci is how the currency moves......
Some believe that is the reason why fibs work too. I believe there is some truth to both working because of being self-fulfilling aspect..........but only some of the time.
  • #20
  • Jan 13, 2008 1:48pm Jan 13, 2008 1:48pm
Quoting Learntocount
I think there is one point being made...the sooner you stop using indicators the sooner you will become a good trader........relying on price action and learning that it is a repeating pattern....find 1 or 2 or 3 that you recognize over and over again and trade them.....as far as pivot points, they are a self fullfilling prophesy because so many traders are aware of them......but the Mathamatics of Fibonacci is how the currency moves...sometimes the pivots line up with it.......
I think the very selffullfilling prophesy aspect of fib or pivot levels is also responsible for many losses ......because many people believe that market will move or stop at those levels. This makes people ignore the crusial part of how to use them which is ......how will price react to a fib level or pivot level? Instead of hoping that price will react to them.

What I mean is that instead of traders to wait and see how price behave around them, we intend to jumped into the market with them, and when price failed to behave the way we wanted it, that is selffullfilling losses.
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