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Chaos Strategy - Mid term and long term trading.

  • #141
  • Sep 24, 2008 9:43am Sep 24, 2008 9:43am
Quoting sonicdeejay
As from the pic..u wil Short @ red line.,,,
I guess u earned few nice pips..at least 50 pips .but in D1 TF, it is still uptrend..and I am in for D1..

Good Job!
Sonic
Your uptrend on the daily is currently composed of a doji and spinning top. At least on my ibfx chart. That doesn't look exactly favorable. Haven't earned a thing actually. Did get the SAO signal. I'm just waiting for it to move down. Will it? Don't know. We shall see what we shall see.
  • #142
  • Sep 24, 2008 5:42pm Sep 24, 2008 5:42pm
I almost cry this is so hard i have read the pdf that i was given but i dont understand how to draw the lines and i dont understand how to use the gator what i have seen this is crusial to the system because otherwise u get many false wisemen and when you taxgeek start talking about EWT then teardrops really start to fall maybe im stupid but why must it be so hard for me to understand this ??


best regards
  • #143
  • Sep 24, 2008 11:51pm Sep 24, 2008 11:51pm
Quoting jgadefelth
I almost cry this is so hard i have read the pdf that i was given but i dont understand how to draw the lines and i dont understand how to use the gator what i have seen this is crusial to the system because otherwise u get many false wisemen and when you taxgeek start talking about EWT then teardrops really start to fall maybe im stupid but why must it be so hard for me to understand this ??


best regards
do u know wut a comma or period is?
  • #144
  • Sep 25, 2008 12:17am Sep 25, 2008 12:17am
Quoting taxgeek
Your uptrend on the daily is currently composed of a doji and spinning top. At least on my ibfx chart. That doesn't look exactly favorable. Haven't earned a thing actually. Did get the SAO signal. I'm just waiting for it to move down. Will it? Don't know. We shall see what we shall see.
I have close my longs(2 pos) for +300 pips each on GBP/USD LONGs...


Sonic
  • #145
  • Sep 25, 2008 1:49am Sep 25, 2008 1:49am
Regarding Alligator read the technical description in the MT 4 section
Regarding Fractal there is an indicator also

Watch the chart for may be 2 or three hours to study the price movement along with AO

I have understood the system
  • #146
  • Sep 25, 2008 7:14am Sep 25, 2008 7:14am
I dont see what the gator does he describe it yes but how to use it ??

and the lines you shall draw from wiseman 1 is hard for me to understand.


best regards
  • #147
  • Sep 25, 2008 10:34am Sep 25, 2008 10:34am
Quoting jgadefelth
I dont see what the gator does he describe it yes but how to use it ??

and the lines you shall draw from wiseman 1 is hard for me to understand.


best regards
The Alligator is the compass. It tells you if the market is trending or not trending. It also tells you when the trend is over and what kind of wave you are looking at. Impulse (trend) waves tend to stay above the alligator (assuming uptrend). Corrective waves tend to wallow around in the alligator. By combining the Alligator and Awesome oscillator, it is possible to know where you are in the waves without a bunch of subjective counting. When the lines are intertwining the market is going nowhere.
The lines aren't drawn from the wiseman. They're drawn from the alligator. The base line is drawn from where the lines were intertwined or closest together in line with the alligator's jaw (blue line). The other line is drawn through the price line ( could actually be say a 5 period ema). If there is a steep angle between the price line and the base line, you have a possible trade below the wiseman. The blue line is where price would be without any new information. As information comes into the market price stretches away from the blue line, and much like a rubber band it will eventually snap back. What you're looking for is the point at which it will snap and return to the blue line and perhaps go out the other way. If it does you then use the break of fractals above the alligator to add postions and the relationship between price and the alligator to track the trade.
  • #148
  • Sep 25, 2008 12:43pm Sep 25, 2008 12:43pm
Take profit hit. 270 pip gain.
  • #149
  • Sep 25, 2008 1:52pm Sep 25, 2008 1:52pm
Copied from th MT4 USER GUIDE

Alligator

"Most of the time the market remains stationary. Only for some 15–30% of time the market generates trends, and traders who are not located in the exchange itself derive most of their profits from the trends. My Grandfather used to repeat: "Even a blind chicken will find its corns, if it is always fed at the same time". We call the trade on the trend "a blind chicken market". It took us years, but we have produced an indicator, that lets us always keep our powder dry until we reach the blind chicken market"

Bill Williams

In principle, Alligator Technical Indicator is a combination of Balance Lines (Moving Averages (mk:@MSITStore:C:\Program%20Files\FXDD%20-%20MetaTrader%204\terminal.chm::/ug_ind_moving_average.htm)) that use fractal geometry and nonlinear dynamics.

  1. The blue line (Alligator’s Jaw) is the Balance Line for the timeframe that was used to build the chart (13-period Smoothed Moving Average (mk:@MSITStore:C:\Program%20Files\FXDD%20-%20MetaTrader%204\terminal.chm::/ug_ind_moving_average.htm), moved into the future by 8 bars);
  2. The red line (Alligator’s Teeth) is the Balance Line for the value timeframe of one level lower (8-period Smoothed Moving Average (mk:@MSITStore:C:\Program%20Files\FXDD%20-%20MetaTrader%204\terminal.chm::/ug_ind_moving_average.htm), moved by 5 bars into the future);
  3. The green line (Alligator’s Lips) is the Balance Line for the value timeframe, one more level lower (5-period Smoothed Moving Average (mk:@MSITStore:C:\Program%20Files\FXDD%20-%20MetaTrader%204\terminal.chm::/ug_ind_moving_average.htm), moved by 3 bars into the future).

Lips, Teeth and Jaw of the Alligator show the interaction of different time periods. As clear trends can be seen only 15 to 30 per cent of the time, it is essential to follow them and refrain from working on markets that fluctuate only within certain price periods.
When the Jaw, the Teeth and the Lips are closed or intertwined, it means the Alligator is going to sleep or is asleep already. As it sleeps, it gets hungrier and hungrier — the longer it will sleep, the hungrier it will wake up. The first thing it does after it wakes up is to open its mouth and yawn. Then the smell of food comes to its nostrils: flesh of a bull or flesh of a bear, and the Alligator starts to hunt it. Having eaten enough to feel quite full, the Alligator starts to lose the interest to the food/price (Balance Lines join together) — this is the time to fix the profit.

Calculation

  • #150
  • Edited Mar 1, 2011 8:43pm Sep 25, 2008 2:06pm | Edited Mar 1, 2011 8:43pm
This could be a good indicator for the Break out
  • #151
  • Sep 25, 2008 6:44pm Sep 25, 2008 6:44pm
Taxgeek thanks for trying to explain to me can you show with a chart or something also my EWT is not good i just now little what it is all about do you recomend that we/ or i read up on EWT also to better se the whole picture ? and if so is a a easy book or site to learn from on this ?


Also what winning percent do you have on your trades using this system ? it sounds by the way you talk that you have a pretty high win ratio, just curiuos


best regards
  • #152
  • Sep 26, 2008 1:55pm Sep 26, 2008 1:55pm
Quoting jgadefelth
Taxgeek thanks for trying to explain to me can you show with a chart or something also my EWT is not good i just now little what it is all about do you recomend that we/ or i read up on EWT also to better se the whole picture ? and if so is a a easy book or site to learn from on this ?


Also what winning percent do you have on your trades using this system ? it sounds by the way you talk that you have a pretty high win ratio, just curiuos


best regards
You can find some free information here: http://www.elliottwave.com/club/ . If run Elliott Wave through Google, you will probably find more than you care to read. As far as books, Robert Miner Dynamic Trading is the best. He takes a very practical approach to the subject unlike others. Stephen Poser is also good. The ultimate description of the waves is Robert Prechter's Elliott Wave Principle. EW gets kind of a bad rap, because people try it and don't understand how to use it. They become obsessive over correct wave counts and always trying to find the wave structure and lose money. I adopt the simple solution. If I can't clearly see the waves, I don't trade or I move to another pair or another time frame where I can see them. People who lose with it are trying to use it to predict the market or be right about the wave count. For me Elliott Wave gives me the ability to "feel" the structure of the market. I just get in front of the wave and go along for the ride. I generally stick to long term charts, but it's perfectly possible to trade waves on the 5 minute chart. I've done that a couple of times, when I had nothing better to do and traded every move of a five wave structure without a loss. Trading within the structure of the market is what you must do to profit, or as Williams says want what the market wants. There's nothing closer to a holy grail than that.

As far as win percentage goes, I don't overly worry about such things. My only concern is to have more in the account at the end of the week than at the beginning. I don't trade a lot. I usually just have one trade on at a time, but I gain a lot of pips on each trade because I'm shooting for 200-400 pips most of the time. Coming into this thread I was short EurUsd. That trade closed out at the bottom of the wiseman, that set up the next long trade (discussed earlier), which closed last friday. This week I saw nothing I was sure of to start the week and took some short term trades for about a 150 gain. Then saw the setup for the GBPUsd trade short (chart posted earlier), which unfortunately took several days to get moving but finally paid off with a 270 gain. I then immediately went long for the abc correction for about a 100 pip gain. When that ended I turned short and added another 50 today before the market quit moving. I'm now out for the weekend. All of that with multiple lots. The last two were not based on the Williams system and would have broken the rules. If I'm on target with the waves, I trade every twist and turn. I don't pay much attention to the indicators anymore and just dance with market. Since we started this discussion, win rate has been 100%. Of course I do get a bad one sometimes, but I usually jump right out before I lose more than 50 pips. So losses are pretty insignifcant. Having lost rather badly trying to trade lines crossing lines, flashing indicators, and price action, I've realized that all those things will work, if you trade with an understanding of market structure. If you can't feel the market's dance, you will lose no matter what you is on your chart. The primary function of Elliott Wave is not to allow you to predict the market but to allow you to feel and get in tune with the market's movements. That's why you need to know it. It's simple but trading isn't easy. It takes lots of hard work to make it.
  • #153
  • Sep 26, 2008 2:40pm Sep 26, 2008 2:40pm
I Have looked at EWT for some years ago but then i thout it was HARD verry hard to grip and to understand my best learning skill is not in reading but in doing things or have some one told me how to do it.

I aboned EWT before thinking i could do alsmost as good with mutch simpler things like indicators or price patterns but no im not sure maybe i shall go back and have a look at EWT again by the way i have glen Nelys book of EWT what do you think about that one ?


best regards
  • #154
  • Sep 28, 2008 5:14am Sep 28, 2008 5:14am
Taxgeek, thanks for your explanations. I tried to backtest the strategy manually in EUR/USD. In theory it looks always good, but in practice it is a little more complicated .
For instance I have always difficulties to identify wiseman 1... sometimes it is just right when the price is in a range, diverges from the blue alligator line and comes back to form a new trend. But not always. The same for the fractals. There are many of them when the alligator "sleeps". They are all outside the alligator, thus being valid in some way. Sometimes it works fine to trade them, when the price breaks out of the range, but sometimes the price just makes a higher high (lower low) and continues sideways - leading to stop out. On the other side, when you trade the fractals only in trend, you miss out a lot of the move. Sometimes indeed all of it.
Also it is hard to identify in which Elliot wave you are, when you don't know the right side of the last price. All of this is always easy when the chart is "complete"...

A question: what do you use as exit strategy? Do you close the positions by "gut feeling" or do you have hard rules for exit?

TIA
  • #155
  • Sep 28, 2008 9:59am Sep 28, 2008 9:59am
Quoting plasmapelz
Taxgeek, thanks for your explanations. I tried to backtest the strategy manually in EUR/USD. In theory it looks always good, but in practice it is a little more complicated .
For instance I have always difficulties to identify wiseman 1... sometimes it is just right when the price is in a range, diverges from the blue alligator line and comes back to form a new trend. But not always. The same for the fractals. There are many of them when the alligator "sleeps". They are all outside the alligator, thus being valid in some way. Sometimes it works fine to trade them, when the price breaks out of the range, but sometimes the price just makes a higher high (lower low) and continues sideways - leading to stop out. On the other side, when you trade the fractals only in trend, you miss out a lot of the move. Sometimes indeed all of it.
Also it is hard to identify in which Elliot wave you are, when you don't know the right side of the last price. All of this is always easy when the chart is "complete"...

A question: what do you use as exit strategy? Do you close the positions by "gut feeling" or do you have hard rules for exit?

TIA
My exit/TP plan is to increase my SL to the resistance level...that way, I can protect my profit and avoid whipsaw...

Sonic
  • #156
  • Edited Mar 1, 2011 8:43pm Sep 28, 2008 10:51am | Edited Mar 1, 2011 8:43pm
I have not started to use the chos system, but Now I have made the set up
for the trade for monday

I am attaching an indicator BH-Double stock which seems to Identify the top
and bottom

Am I coorect in saying that WS1 is completed in JPY/US$ as well as in
GBP/US$ and we are looking for AO 3 for both this currency pairs
  • #157
  • Edited Mar 1, 2011 8:43pm Sep 29, 2008 3:20am | Edited Mar 1, 2011 8:43pm
Asia Session US$/JPY

WS1 Completed downwards

ws 2 AO3 Completed downwards

ws 3 Fractel completed the first two Red AO after the green AO

Since the Angulation is not very wide , I am expecting upward movement
  • #158
  • Edited Mar 1, 2011 8:43pm Sep 29, 2008 1:33pm | Edited Mar 1, 2011 8:43pm
us break out

Chart and statment attached

Trend TF 1 Hour chart

Entry TF 15 Minute chart
  • #159
  • Sep 29, 2008 5:27pm Sep 29, 2008 5:27pm
Quoting jgadefelth
I Have looked at EWT for some years ago but then i thout it was HARD verry hard to grip and to understand my best learning skill is not in reading but in doing things or have some one told me how to do it.

I aboned EWT before thinking i could do alsmost as good with mutch simpler things like indicators or price patterns but no im not sure maybe i shall go back and have a look at EWT again by the way i have glen Nelys book of EWT what do you think about that one ?


best regards
Neely is excellent, but overly complicated and not very understandable. The books I mentioned are much simpler and much more practical.
  • #160
  • Edited Mar 1, 2011 8:43pm Sep 29, 2008 5:40pm | Edited Mar 1, 2011 8:43pm
Quoting plasmapelz
Taxgeek, thanks for your explanations. I tried to backtest the strategy manually in EUR/USD. In theory it looks always good, but in practice it is a little more complicated .
For instance I have always difficulties to identify wiseman 1... sometimes it is just right when the price is in a range, diverges from the blue alligator line and comes back to form a new trend. But not always. The same for the fractals. There are many of them when the alligator "sleeps". They are all outside the alligator, thus being valid in some way. Sometimes it works fine to trade them, when the price breaks out of the range, but sometimes the price just makes a higher high (lower low) and continues sideways - leading to stop out. On the other side, when you trade the fractals only in trend, you miss out a lot of the move. Sometimes indeed all of it.
Also it is hard to identify in which Elliot wave you are, when you don't know the right side of the last price. All of this is always easy when the chart is "complete"...

A question: what do you use as exit strategy? Do you close the positions by "gut feeling" or do you have hard rules for exit?

TIA
Once you get a feel for the market the waves are not that difficult to identify in real time. You only need to identify the one just completed. The awesome oscillator can help in this endeavor. If you recognize that one, you know what will come next. I tend to set take profits to exit. You can see some on the chart below of trades I took last night and today. Haven't done much with Congress debating the bailout, there were likely to be way to many spikes. These are my only trades These were on the 30 minute chart, as I've dropped down in time frame with all the craziness. See no point in taking any long term risk at this point, until there is a resolution. Both off wisemen. I do put in the TP at the time of trade using fib confluence. I don't watch the charts and sleep through most of my trades, or eat lunch or work or something.
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