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Spud's Predictive MTF Stochastics

  • #1,041
  • Edited 7:02am Dec 1, 2008 6:17am | Edited 7:02am
Quoting Merlyn
Hello M-j,

If you read post No 985 you will have your answer.
hi Merlyn,

I'm not exactly sure if I understand what you mean or to what part you exactly refer too.



Quoting Spudfyre
I personally choose M5 to be 14,1,1 and all the rest 14,3,3. The real difference to M5 is small but it just shows peaks better on 14,1,1 than 14,3,3.

Overall, you can use 14,3,3 for all if you like. I don't recommend using 14,1,1 for all...this will turn you into a bobble head. Honest, I've been sitting with people using 14,1,1 and watching their heads bobble with the peaks and valleys....don't let this happen to you!
I still think what I pointed out (Post #1033 ) holds.
What Spud says it is okay to use (14,3,3) for all (I believe he was talking for all within one TimeFrame group)

But I still think if one goes with a setting like Spud(for his obvious reason given above) that one should apply the same setting throughout the higher TF-groups.

So I did the extra job and stick with (14,1,1) for M5 and shift the same settings in relation to the higher TF-groups.

Well just my opinion. MJ
__Thanks__ MJ
  • #1,042
  • Dec 1, 2008 6:31am Dec 1, 2008 6:31am
Quoting M_j
hi Merlyn,

I'm not exactly sure if I understand what you mean or to what part you exactly refer too.





I still think what I pointed out (Post #1033 ) holds.
What Spud says it is okay to use (14,3,3) for all (I believe he was talking far all within one TimeFrame group)

But I still think if one goes with a setting like Spud(for his obvious reason given above) that one should apply the same setting throughout the higher TF-groups.

Anyway I checked...
Hello M-j,

My interpretation of Spud's explanation is that he uses 4,1,1 on M5 as an entry signal only as it gives a clearer signal with more easily defined peaks etc. All other time frames in all other time frame groups are set to 4,3,3 as per the trading rules for trading the Rope or Escalator.
TTFN Merlyn
  • #1,043
  • Dec 1, 2008 6:33am Dec 1, 2008 6:33am
Quoting Merlyn
Hello M-j,

My interpretation of Spud's explanation is that he uses 4,1,1 on M5 as an entry signal only as it gives a clearer signal with more easily defined peaks etc. All other time frames in all other time frame groups are set to 4,3,3 as per the trading rules for trading the Rope or Escalator.
Thats my understanding as well Merlyn I'm quite sure it's right
Time hides Nothing
  • #1,044
  • Edited 6:44am Dec 1, 2008 6:43am | Edited 6:44am
Oh I see what you mean.

I think that would make also perfectly sense. If that is so - I mis-interpreted it - but it would be perfectly okay as TF-group M5 is special

Now I got really curious what Spud himself really thinks. Waiting for the Master to come ...http://www.forexfactory.com/images/icons/icon12.gif


But CindyXXXX: one would still need to change the Filter to (14,3,3) on your pic when one move on to TF_group M15
Attached Image (click to enlarge)
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__Thanks__ MJ
  • #1,045
  • Dec 1, 2008 6:45am Dec 1, 2008 6:45am
We use 14,1,1 on M5 can we use it on higher time frames?

First, there is no reason why you can't use 14,1,1 on the higher time frames, but let me explain why I don't.

14,1,1 is a fast stochastic and as such much more jittery. The benefits of 14,1,1 in the M5 entry group is that we are using it for entry. In otherwords, we are not following it after we enter. These faster (sharper) moves give us a little quicker response to our entry.

When we pop up to M15 and M30 we want to stay in the trade and avoid whipsaws. On M15 we keep M5 a little faster on the filter just to help it keep pace a bit. However, the M15 is our trending chart and we want to avoid being affected by whipsaws. In otherwords, the smoother 14,3,3 line will hold us in just a little longer for M30 and H1.

If I were going to adjust, I'd go all 14,3,3....this would be a slightly more conservative approach. I think you'd find far less benefits in the higher time frames of using 14,1,1 during the trade. It is my observation but feel free to experiment.
  • #1,046
  • Dec 1, 2008 6:51am Dec 1, 2008 6:51am
Quoting Spudfyre
We use 14,1,1 on M5 can we use it on higher time frames?

First, there is no reason why you can't use 14,1,1 on the higher time frames, but let me explain why I don't.

14,1,1 is a fast stochastic and as such much more jittery....


hi Spud,

do I understand the English here correctly:When we pop up to M15 and M30 we want to stay in the trade and avoid whipsaws. On M15 we keep M5 a little faster on the filter just to help it keep pace a bit.

means you keep the M5 (which acts now as Filter at (14,1,1) ?


if so: Wow - no inconstancy but by design. I submit humbly ;-)

Thanks really appreciate your help: which means I properly change all back to (14,3,3) and stay conservative ;-) (not to say simplifying and speeding up my Track keeping)

MJ
__Thanks__ MJ
  • #1,047
  • Dec 1, 2008 7:01am Dec 1, 2008 7:01am
Very nice analysis Cindy...you played that trade about the exact same as me.

I think this is fairly obvious but I might mention it, if we move up a time frame and our risk is too high but we can stay in the lower time frame than you can do that. If you roll back all the way to M5 and it is at Risk 0 in the same trade direction...we obviously stay in the trade and go to M15 since this is an entry.

This can happen if say M30 is lagging a bit but looks like it will go our way and M15 is still ok risk wise. It can get a little riskier this way....I prefer them rolling over into each other but with 4 chart groups up it should be fairly easy to see where we are and if the risk is worth taking.

Entries and staying in trades can be at any time the Risk is 0, 20 or 40. Exits can be at Risk 20, 40, 60, 80 ,100...it is simply how much risk you want in your trade. For the mechanical system I drew the line on one set of rules to make it simple. However, in mutliple charts and using our brains you can constantly assess the risk level of each time frame for our trade.
What you are looking for is "rollover" to each higher time frame...if you can rollover to each higher time frame and maintain Risk 0, 20, 40 on each rollover say M15, to M30 for example but M15 has not gone Risk 0 yet and then H1 goes say Risk 20...then you can stay on M15 or bump yourself up to M30. Don't be afraid to travek through the time frames..it just gives you finer focus on your trade...the higher time frames smooth out the whipsaws and the lower time frames allow you to time your exit.
  • #1,048
  • Dec 1, 2008 7:03am Dec 1, 2008 7:03am
Quoting M_j
hi Spud,

do I understand the English here correctly:When we pop up to M15 and M30 we want to stay in the trade and avoid whipsaws. On M15 we keep M5 a little faster on the filter just to help it keep pace a bit.

means you keep the M5 (which acts now as Filter at (14,1,1) ?


if so: Wow - no inconstancy but by design. I submit humbly ;-)

Thanks really appreciate your help: which means I properly change all back to (14,3,3) and stay conservative ;-) (not to say simplifying and speeding up my Track keeping)

MJ
Either.....
Set M5 only at 14,1,1 on M5 Group and M15 Group
or
Set all stochastics to 14,3,3 (except 100,3,3)
  • #1,049
  • Dec 1, 2008 7:04am Dec 1, 2008 7:04am
if i am wrong pls correct me guys
we use 100-3-3 and 14-3-3 on the trading chart
we use 14-1-1 for m5 cross with 14-3-3 m15 and so on with the bigger tf
we use 14-3-3 as a filter (1tf less than the tradding chart)
  • #1,050
  • Edited 7:37am Dec 1, 2008 7:10am | Edited 7:37am
if we ve a short trade and we found at the candle close the price line is exacly at 76.4ponting down do we consider it a +20% or a -20%
in our risk calculation?

also if i swich the tf and i found in the still open candle that risk is 60% do i exit or i wait for the candle close?
  • #1,051
  • Dec 1, 2008 8:14am Dec 1, 2008 8:14am
Quoting sarah2002
if we ve a short trade and we found at the candle close the price line is exacly at 76.4ponting down do we consider it a +20% or a -20%
in our risk calculation?

also if i swich the tf and i found in the still open candle that risk is 60% do i exit or i wait for the candle close?
good question!
Time hides Nothing
  • #1,052
  • Dec 1, 2008 8:38am Dec 1, 2008 8:38am
here is a situation
i got an 0% long entry on the 5m chart
so i entered price was1.2605
than swiched o 15m combination risk was 20%
at the candle close risk was 0 %
but during that new candle price when up and down and it hit breakeven point the high of that candle was 1.2623
how should i manage that trade when ust i move stop to break even or to profit lock
especialy that price now while im writing this question is jumping up
its was as if they meant to push the price down to hit breakevens
some other cases if i dont move stop to breakeven i regret and it ends with a hit stoploss

how do we manage this?
thanks
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  • #1,053
  • Edited 9:06am Dec 1, 2008 8:51am | Edited 9:06am
Quoting sarah2002
here is a situation
i got an 0% long entry on the 5m chart
so i entered price was1.2605
than swiched o 15m combination risk was 20%
at the candle close risk was...
The EUR isn't really doing a lot today Sarah - I've had the same problem been stopped out at BE a couple of times after being up 15 or so pips..

There was the way Spud suggested where you trail your stop at 50% of your profits E.g up 10 pips - +5 pip stop - up 20 pips - +10 Stop etc.

Apart from that I guess we just have to wait for things to pick up and for the time being maybe settle for small 10 pip gains

I think also a good idea is to be consistant with whatever you choose to do instead of sometimes moving your SL to break even and other times not... Choose one way and stick to it and sometimes you will be stopped out but other times you can catch some pips. But the end result will be consistancy and the odds in your favour over the long run

I guess if you do random things you can expect random results

Personally if im up 15 pips I move my SL to BE every time.

Hopefully Spud can answer your question better
Time hides Nothing
  • #1,054
  • Dec 1, 2008 9:14am Dec 1, 2008 9:14am
What time zone is everyone using MT4 on? I see 17:05 on this chart but on mine it is 13:05. I want to make sure I'm showing the same as everyone.


Quoting sarah2002
here is a situation
i got an 0% long entry on the 5m chart
so i entered price was1.2605
than swiched o 15m combination risk was 20%
at the candle close risk was...
  • #1,055
  • Dec 1, 2008 9:35am Dec 1, 2008 9:35am
Spud,

Can you look at this chart and tell me why you think this trade failed? I didn't take it but I was just looking at the charts at this time and I see that a long wouldn't have worked out here. Do you see anything that I'm missing or is it just a case in which the market would've burned me? The yellow vertical lines are where every stoch was at the time I would've taken the long.
Attached Image (click to enlarge)
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  • #1,056
  • Dec 1, 2008 9:40am Dec 1, 2008 9:40am
i use metatrader 4 altrade plate forum
cause it gives me the almost similar prices as fxsol my broker
mine is gmt +2
  • #1,057
  • Dec 1, 2008 9:45am Dec 1, 2008 9:45am
Quoting jdcompute
Spud,

Can you look at this chart and tell me why you think this trade failed? I didn't take it but I was just looking at the charts at this time and I see that a long wouldn't have worked out here. Do you see anything that I'm missing or is it just a case in which the market would've burned me? The yellow vertical lines are where every stoch was at the time I would've taken the long.
I don't see the M15 crossing the M30 upwards at the yellow line.
  • #1,058
  • Dec 1, 2008 9:46am Dec 1, 2008 9:46am
Quoting jdcompute
What time zone is everyone using MT4 on? I see 17:05 on this chart but on mine it is 13:05. I want to make sure I'm showing the same as everyone.
My chart time is EST +7
  • #1,059
  • Dec 1, 2008 9:49am Dec 1, 2008 9:49am
yes cindy you are right about sticking to one system for stoploss and exiting a trade cause i ve random exits and random results
thats why im waiting for the part of stoploss and managing the trade because i think this new system help a lot to be an emotion free trader to escape the traps the market makers do
  • #1,060
  • Dec 1, 2008 10:04am Dec 1, 2008 10:04am
Quoting sarah2002

how do we manage this?
thanks

Hello sarah,

One way would be to close a percentage of your trade, say 50%, at a likely first profit target, say +10 pips. Then set your stop loss to b/e or b/e +1.

If price comes back to hit your s/l you have already banked a profit and simply wait for the next entry.

If price continued in your direction then close 50% of the remaining trade at a second likely target, say +20 pips. You may then either leave your s/l where it is or move it to +10 pips.

The remaining portion of your trade may then remain open until you receive a signal to close it from whichever chart you are now on.

This method will sometimes allow a portion of your trade to remain open WHEN and not if stop hunting is going on, after which you can re-enter the market and add to your position should you get a new M5 entry signal in the original direction of the trade, something which Spud has eluded to in the past but not yet covered in detail.

The +10 and +20 figures that I used are for example only as we all trade slightly differently, some waiting an extra 20 seconds for confirmation and possibly losing a few pips while others will be in 20 seconds before candle close using the Brain Indicator to anticipating the move and making a few extra pips. Ideally we should all be keeping our own stats to tell us what these figures, together with our initial entry s/l, should be for our own trading style.

Food for thought: 10 pips a day on 1 full lot = £/$/€100 a day
10 pips a day on 10 full lots = £/$/€1,000 a day
10 pips a day on 100 full lots = £/$/€10,000 a day

Should we be sitting in front of a computer 24/5 trying to make a gazillion pips each day or refining our technique to allow us to make 10 pips in the first hour of trading allowing us to enjoy the remainder of the time as we think best . I suspect that Spud is trying to teach us the latter
TTFN Merlyn
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