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Pair Divergence Method

  • #281
  • Apr 19, 2009 11:44am Apr 19, 2009 11:44am
Quoting acetrader
billbss & Everyone

Last week I took 3 trades using this method on the EUR/USD-USD/CHF & all three were winning trades....
Stay on demo until I get the results compiled.

1. A member has provided me an indicator that makes the backtesting much more reliable. I am using it now to get more accurate results for EU-UC, for the last 3 1/2 months.

2. I believe I have found a much better SL and TP, than the ATR. I'm still testing this.

I'll try my best to get this posted today. If not, I'll shoot for tomorrow.
  • #282
  • Apr 19, 2009 7:11pm Apr 19, 2009 7:11pm
billbss,

I'll stay on demo & await your correlation results.
  • #283
  • Apr 19, 2009 7:32pm Apr 19, 2009 7:32pm
Yes sir, do not try it at home! The reason for the opposite entry: chf was being bought heavily, I knew the BIG correction needed to come from the usd, and it did.

Quoting babatot
Wasn't that almost the OPPOSITE of a textbook trade?
  • #284
  • Apr 19, 2009 9:23pm Apr 19, 2009 9:23pm
Dear Billbss,

Thanks indeed for a very exciting finding. I tried the EUR/JPY versus the GBP/JPY. However, I do need to re-confirm your following statement:

Your Statement:
"The chart below shows the EUR/JPY and the GBP/JPY, together.
Basically, if one pair makes a lower low and the other does not, you buy the one that does not. If one pair makes a higher high and the other does not, sell the pair that does not. I wait until both pairs have turned in the direction of the trade, before entering."

Clarification 1:
Q1-"if one pair makes a lower low and the other does not". How do I determine that one is making a lower low than the other? If both value is lower than the 20MA, the current price value is the determinant for the lower low? Example : Now ( 20/4/09 10.00.am Malaysian time), EUR/JPY is 128.34 and GBP/JPY is 145.55. Does that mean that EUR/JPY at 128.34 is the lower low? Or is it lower low is determined by the distance ( measured in pips) between the current value and the MA line for both? Please help elaborate.

Clarification 2:
Q2- "I wait until both pairs have turned in the direction of the trade, before entering." Does this mean ensuring the candles concur - bullish (up) or bearish (down) candles appears for both? Please help elaborate.

I think this correlation is great. I tried a few times, it works but I wasn't confident if I had determined the lower low or higher high correctly.

Need your help.

Thank you

MartGarbera
[email protected]
  • #285
  • Apr 19, 2009 9:41pm Apr 19, 2009 9:41pm
Quoting MartGarbera
Dear Billbss,

Thanks indeed for a very exciting finding. I tried the EUR/JPY versus the GBP/JPY. However, I do need to re-confirm your following statement:

Your Statement:
"The chart below shows the EUR/JPY and the GBP/JPY, together.
Basically, if one pair makes a lower low and the other does not, you buy the one that does not. If one pair makes a higher high and the other does not, sell the pair that does not. I wait until both pairs have turned in the direction of the trade, before entering."

Clarification 1:
Q1-"if one pair...
This has nothing to do with a 20 MA.
Here is a link to a post that might help.
http://www.forexfactory.com/showpost...0&postcount=18
You might go back and read the first few pages. We don't look at candles, at all.
  • #286
  • Apr 20, 2009 3:46am Apr 20, 2009 3:46am
Trading time :
gmt 6 - gmt 16

Trading pair -eur usd

total trades 33
winning trades 25

19 TRADES with R.R 3
14 TRADES WITH R.R 2

MAX DD -24 PIPS (i worked to decrease it a lot ) over this time span

Bill testing january and all other months i will require the indi ur using as its getting difficult doing that using lux int indi .so post up the indi bill.
  • #287
  • Apr 20, 2009 4:19am Apr 20, 2009 4:19am
Quoting ForceDevotee
Trading time :
gmt 6 - gmt 16

Trading pair -eur usd

total trades 33
winning trades 25

19 TRADES with R.R 3
14 TRADES WITH R.R 2

MAX DD -24 PIPS (i worked to decrease it a lot ) over this time span

Bill testing january and all other months i will require the indi ur using as its getting difficult doing that using lux int indi .so post up the indi bill.
That sounds great.
The indicator is not mine. I will need the permission of the author to post it.

The person it belongs to, may read this and choose to post it if he wants. I don't want to say who it is, because I want to respect his privacy.

I don't think it will help you as much as it has helped me.
It marks coincident peaks and valleys. I noticed on the chart you posted, that you don't necessarily look for those.

If you'll give us another example of what you're doing maybe we can help you test. I'll be finished with what I'm doing tomorrow, and will be glad to help.

Thanks for your work. It looks like it's really paying off.
  • #288
  • Apr 20, 2009 4:38am Apr 20, 2009 4:38am
billbss, can you please post your better way of putting the SL and TP?
  • #289
  • Apr 20, 2009 4:42am Apr 20, 2009 4:42am
Quoting hoki
billbss, can you please post your better way of putting the SL and TP?
What I thought was better didn't work out.
I'll post everything I found as soon as I look at a few more things.
This stuff is SLOW. It's like picking salt out of sugar
  • #290
  • Apr 20, 2009 4:49am Apr 20, 2009 4:49am
1)I understand bill i also take valley and hill but as its done in 5 min tf and there are lots of divergence causing a little offset in peaks and valley so i take peaks and valley which coincides even with small divergence.

2)bill it will be helpfull to test it long term in luxint indi it worked fine till march 1 from feb onwards there is lot of distance between peaks of usdchf and eur usd using lux indi its very difficult if u have indi which marks peaks together then i think its lot easy to do it rest on you.

full credit of the concept goes to you bill as u originated this concept and we have to work like a team more people will test and have there concept more its good.
Attached Image (click to enlarge)
Click to Enlarge Name: pair divergence.gif Size: 28 KB
  • #291
  • Apr 20, 2009 4:51am Apr 20, 2009 4:51am
My first time on this thread. It was brought to my notice by Forex007, and I spent some of the weekend reading through the thread and trying to get my head around it.
Just thought I'd post this chart to see if I'm getting it right. All relevant points are marked......any comments appreciated, mate. Looks like a nice pip-collector, bill.
Cheers
Attached Image (click to enlarge)
Click to Enlarge Name: eurjpy022.gif Size: 20 KB
  • #292
  • Apr 20, 2009 5:33am Apr 20, 2009 5:33am
I like that one, good example! Red makes a significant HH, yellow does not, sell yellow. If in mirror mode, buy yellow.

Quoting eyevoltage
My first time on this thread. It was brought to my notice by Forex007, and I spent some of the weekend reading through the thread and trying to get my head around it.
Just thought I'd post this chart to see if I'm getting it right. All relevant points are marked......any comments appreciated, mate. Looks like a nice pip-collector, bill.
Cheers
  • #293
  • Apr 20, 2009 5:55am Apr 20, 2009 5:55am
Quoting eyevoltage
My first time on this thread. It was brought to my notice by Forex007, and I spent some of the weekend reading through the thread and trying to get my head around it.
Just thought I'd post this chart to see if I'm getting it right. All relevant points are marked......any comments appreciated, mate. Looks like a nice pip-collector, bill.
Cheers
Nice one, EV! Did you use ATR for exit or smth else?
One Chart is Worth Ten Thousand Words.
  • #294
  • Apr 20, 2009 6:15am Apr 20, 2009 6:15am
Artov....glad you like the trade. It's encouraging to know I'm going in the right direction!!

Forex007.....hello, mate. No, I didn't use the ATR for exit. I was called away from the computer in a hurry, so I just closed the trade there and then. These things happen in this house, mate....can't be avoided! Thanks for pointing me to this thread and the method. I love K.I.S.S. !!!!
  • #295
  • Apr 20, 2009 8:15am Apr 20, 2009 8:15am
Quoting ForceDevotee
Trading time :
gmt 6 - gmt 16

Trading pair -eur usd

total trades 33
winning trades 25

19 TRADES with R.R 3
14 TRADES WITH R.R 2

MAX DD -24 PIPS (i worked to decrease it a lot ) over this time span

Bill testing january and all other months i will require the indi ur using as its getting difficult doing that using lux int indi .so post up the indi bill.
How do you get variable R:R, are you using the nearest top or bottom as stop?
  • #296
  • Apr 20, 2009 11:13am Apr 20, 2009 11:13am
Two r.r used

a)in favour of trend or the locality peak r.r =3

b)against the trend r.r = 2

al things are decided on stats and as u know mere 33 trades do not decide the stats so i am working on atleast 200 trades once its done i will out the full stratergy.

main focus is to have good r.r and high probablity and low drawdown and more avg pips per months.

for a good system ratio avg monthly pips to max dd over 200 trades span must be greater than 10.
  • #297
  • Apr 20, 2009 12:39pm Apr 20, 2009 12:39pm
Hi Guys,
Just a bit confused with euro/usd usd/chf mirror mode is true. Alittle while ago euro made a new low but chf made a higher low, does that mean I should go short chf and do I have to wait for euro to turn down. As I write this chf just made a new high on my chart but euro did not does this mean a short on euro and do i have to wait for chf to turn down, or have i got this all wrong?
Kind Regards
Geoff
  • #298
  • Apr 20, 2009 12:57pm Apr 20, 2009 12:57pm
Quoting Geoffrey
Hi Guys,
Just a bit confused with euro/usd usd/chf mirror mode is true. Alittle while ago euro made a new low but chf made a higher low, does that mean I should go short chf and do I have to wait for euro to turn down.
Yes correct if chf did not make a lower low as the euro did, then you short chf but wait first for both pairs to turn in the same direction.

Remember if you use the indi from Lux on a eur/usd based chart, then only chf is mirrored, not euro.

Quoting Geoffrey
As I write this chf just made a new high on my chart but euro did not does this mean a short on euro and do i have to wait for chf to turn down, or have i got this all wrong?
Kind Regards
Geoff
You always have to wait for both pairs to turn in the same direction on your screen. Yes in this case it would be a short euro, I would not trade it because the previous peak on the eur was not significant and it almost broke the previous peak. Not an A+ trade to me. Also please note volatility for eur/usd is not at it's best when London session is closed.
  • #299
  • Apr 20, 2009 3:08pm Apr 20, 2009 3:08pm
Hey team,

I've packaged up my template, indicators, and a PDF explaining their use. Here's a screen shot.
Attached Image
Attached File(s)
File Type: mq4 MultipleCurrenciesV03.mq4   4 KB | 916 downloads
File Type: ex4 MultipleCurrenciesV03.ex4   4 KB | 687 downloads
File Type: mq4 ATRbandsV02.mq4   3 KB | 845 downloads
File Type: ex4 ATRbandsV02.ex4   3 KB | 641 downloads
File Type: tpl correlationv01.tpl   1 KB | 823 downloads
File Type: pdf CurrencyDivergenceAndATRv01.pdf   245 KB | 2,423 downloads
  • #300
  • Apr 20, 2009 3:51pm Apr 20, 2009 3:51pm
Thank's a lot pippa,

very nice work

BR

PC


Quoting pippaFett
Hey team,

I've packaged up my template, indicators, and a PDF explaining their use. Here's a screen shot.
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