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Pair Divergence Method

  • #261
  • Apr 16, 2009 11:35pm Apr 16, 2009 11:35pm
Quoting luxinterior
...BUT you would have taken the one just preceding...
Hi Lux,

White makes a second low which is lower, but yellow's second low is higher. So, long yellow after the uptick is a system compliant trade. Is that the trade you meant?

(if you meant the prior short white, that's a no trade, as the first peak does not happen on the same bar for both pairs)

Hope this helps,

VBro
  • #262
  • Apr 16, 2009 11:40pm Apr 16, 2009 11:40pm
Bill,

I've done Feb, 15 min (same specifications as prior Jan test), and here's what I found.

24 trades
11 wins
11 losses
2 reversals

Maybe you want to run Feb yourself and see if your test comes up different?

VBro
  • #263
  • Apr 16, 2009 11:48pm Apr 16, 2009 11:48pm
Quoting vbro
Hi Pri,

I had a look for the 'daily' long you mentioned....
hi vbro, sure this helps

my chart GMT+2,
thank's for the explanations clear enough for me..
perhaps I should wait for the next daily bar, hope new low happen on E/J.
  • #264
  • Apr 17, 2009 3:15am Apr 17, 2009 3:15am
RR3 trade as per the charts. Vertical line marks the point where I spotted the divergence. I took the trade on the next bar.
Attached Images
One Chart is Worth Ten Thousand Words.
  • #265
  • Apr 17, 2009 3:27am Apr 17, 2009 3:27am
007 can u guide me on how to set up the charts to get the 2 symbols on the same chart?
Just my 2 cents worth
  • #266
  • Apr 17, 2009 3:30am Apr 17, 2009 3:30am
Quoting billbss
46 Trades
36 W
10 L
78.2% Win rate
Impressive result!! Thank you, Bill, for sharing your system!
One Chart is Worth Ten Thousand Words.
  • #267
  • Apr 17, 2009 3:33am Apr 17, 2009 3:33am
Quoting Guy Mann
007 can u guide me on how to set up the charts to get the 2 symbols on the same chart?
http://www.forexfactory.com/showpost...&postcount=161

Setup MA as per Bill's instructions, add the above indi - see link -choosing correct 2nd pair in its setting - don't type "m" at the end of the currency name; and setting mirror to true if one of the pairs is USDCHF.
One Chart is Worth Ten Thousand Words.
  • #268
  • Apr 17, 2009 4:50am Apr 17, 2009 4:50am
Quoting vbro
Bill,

I've done Feb, 15 min (same specifications as prior Jan test), and here's what I found.

24 trades
11 wins
11 losses
2 reversals

Maybe you want to run Feb yourself and see if your test comes up different?

VBro
I just did Feb. and got 9W - 7L.

I understand how we can vary. It's extremely painstaking and subject to error. At least it is for me.
I think it's safe to say that Feb. was a breakeven month, at best.

I'm going to go back over all of it, in the next couple of days.

I've seen some things that will help the results.

The 2xATR is one of them. If the trade occurs soon after big news bars, the news bars are computed into the ATR, and sets the PT at an unrealistic level.

Maximum Excursion studies are the right way to determine SLs and PTs. I'm sure I can complete them this weekend.

Any system that does better than a random coin toss, is of value and can be fine tuned. This one does considerably better than that, if my Mar-Apr results are correct. I'm going to check them again.

I'll be back when I have something to report.

Thanks for your help.
  • #269
  • Apr 17, 2009 5:04am Apr 17, 2009 5:04am
Quoting billbss
The 2xATR is one of them. If the trade occurs soon after big news bars, the news bars are computed into the ATR, and sets the PT at an unrealistic level.
Bill, have you thought of using price action and/or support/resistance for SL and TP? Pair divergence is good at determining entry period, but observing nearest SR levels could give a better clue as to SL and TP that just ATR. Just a thought
One Chart is Worth Ten Thousand Words.
  • #270
  • Apr 17, 2009 5:17am Apr 17, 2009 5:17am
Quoting Forex007
Bill, have you thought of using price action and/or support/resistance for SL and TP? Pair divergence is good at determining entry period, but observing nearest SR levels could give a better clue as to SL and TP that just ATR. Just a thought
I use S&R levels in my own trading, but they are subjective. No two people draw them the same.
I want an objective and definable SL and PT for this, so it will be completely mechanical.
  • #271
  • Apr 17, 2009 8:18am Apr 17, 2009 8:18am
I traded today so far the eur/usd short for a nice quick 35 pips. ATR was 37 pips but I closed manually for 2 pips less than TP due to strong support around the 1.3060 level.

Afterwards I am glad i closed the position earlier, otherwise I would have to wait 30 minutes before the TP (2pips more) would have been hit. And it would have been stressing too due to pretty much drawdown.

It was not a textbook trade, but in my opinion the eur/usd needed to make a bearish correction vs. the strong bullish(mirror) momemtum in usd/chf.
Attached Image (click to enlarge)
Click to Enlarge Name: convergence1.gif Size: 22 KB
  • #272
  • Apr 17, 2009 11:57am Apr 17, 2009 11:57am
Here is the first intro to the indi I've been using to speed my backtesting and help me get closer to getting alerts during London (middle of night for me).

1. I set MT to only show close price and set the color to really dark green so it isn't a distraction.
2. The indi shows the 1 SMA Typical as bright yellow which is really what I need to see.
3. The indi draws 2 upper and 2 lower ATR bands spaced 1 ATR apart so I can see the ATR's flow along with price.
4. The indi draws the inverted USDCHF, in this case it's below EURUSD for no reason - it's just for visual comparison.
5. The indi monitors peaks and valleys in both currencies and ONLY puts the arrows if they occur in both pairs simultaneously, like mini fractals based on only 3 bars.
6. When it's time to trade I can switch MT to show bars, like in the second screen.

Once I get the indi to automatically move the second pair into easy visual position I'll post it for any who'd like it.
Attached Images
  • #273
  • Apr 17, 2009 1:54pm Apr 17, 2009 1:54pm
Quite prety pictures ! So plz post your amazing indi/template !
  • #274
  • Apr 17, 2009 2:00pm Apr 17, 2009 2:00pm
Quoting pippaFett
Here is the first intro to the indi I've been using to speed my backtesting and help me get closer to getting alerts during London (middle of night for me).

1. I set MT to only show close price and set the color to really dark green so it isn't a distraction.
2. The indi shows the 1 SMA Typical as bright yellow which is really what I need to see.
3. The indi draws 2 upper and 2 lower ATR bands spaced 1 ATR apart so I can see the ATR's flow along with price.
4. The indi draws the inverted USDCHF, in this case it's below EURUSD for no reason - it's...
I'll be glad to see it.
  • #275
  • Apr 17, 2009 5:01pm Apr 17, 2009 5:01pm
Quoting pippaFett
Once I get the indi to automatically move the second pair into easy visual position I'll post it for any who'd like it.
Is it smth written specifically for Bill's system or smth which was developed to show divs in principle? Looks interesting. What do those arrows show?
One Chart is Worth Ten Thousand Words.
  • #276
  • Apr 17, 2009 7:34pm Apr 17, 2009 7:34pm
Quoting artov
It was not a textbook trade

Wasn't that almost the OPPOSITE of a textbook trade?
  • #277
  • Apr 17, 2009 9:11pm Apr 17, 2009 9:11pm
I eagerly await this indicator! Thanks pippaFett for taking the time to do this.
  • #278
  • Apr 18, 2009 6:03am Apr 18, 2009 6:03am
hi bill,

The overlay chart is in line.
why changed the existing chart to ma with 1, simple, typical.

Should we compare with same format. line to line.
or your overlay chart is also in ma 1,simple and typical

regards
  • #279
  • Apr 18, 2009 7:09am Apr 18, 2009 7:09am
Quoting vincentlim
hi bill,

The overlay chart is in line.
why changed the existing chart to ma with 1, simple, typical.

Should we compare with same format. line to line.
or your overlay chart is also in ma 1,simple and typical

regards
The overaly chart is , also, SMA1. Typical.
  • #280
  • Apr 19, 2009 11:32am Apr 19, 2009 11:32am
billbss & Everyone

Last week I took 3 trades using this method on the EUR/USD-USD/CHF & all three were winning trades. These were all in demo mode, but this week I will give the method a go on a small live account I have strictly for trying out a new method or idea.

Bill, I am most interested in the results of your weekend correlation studies.

Anyone willing to share their pair correlation views or comments & trading results for last week I would be most interest.

This seems to be a good method with NO downside that I can see thus far.
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