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Chaos Trading System

  • #361
  • May 26, 2009 10:03pm May 26, 2009 10:03pm
Metatrader has it as Parabolic SAR.
Quoting Slight
Greenriver, what's a parabolic stop? Could you elaborate a little more on how to use it, or how do you spot when its better to now use the green instead of the red line as a stop?

I usually like to let it run and dont take small profits, except for there was a div bar and I felt price could turn around (pretty seldomly, often in wave 4). My experience so far has been, that I dont get kicked out keeping the stop below the last fractal. In most trends it works out very well. I have in the past exited as soon as the green line was hit at the close...
  • #362
  • Edited 5:44pm May 27, 2009 5:30pm | Edited 5:44pm
I post this for comment. Who see's angulation and who does not and why. I have drawn lines to the last cross of the green line to todays close on the green line and the red line. How do you draw your angulation lines? Each of the prior Div bars have failed to produce a reaction, will this be the one? Please note that this is the CAD futures... not the cross. I guess the CAD/$ would be the same. Lets start the discussion... there is no right or wrong,that I am sure of!!!
Edit: I have added a more orthodox drawing of the angulation lines in the second chart. Which ones do you prefer. I know this is in the book but many use different beginning and ending locations so I am interested to hear others veiws.
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  • #363
  • May 28, 2009 4:23am May 28, 2009 4:23am
hi greenriver,
I have put the arrows in your chart as I would have drawn the angulation (red arrows); hence I see angulation... The way I draw the lines is: where did the price move - where did the "middle of the blue and the red line of the alligator move." Most of the time the lines I draw do not cross.
The reason I do not like this divergent bar is the AO. It is at its peak and the trend could continue further up in what could be wave 3?! When I try to take divergent bars it's mostly those with divergence in the AO. But I guess this is to everyone's own liking... I do not care too much about the angualtion.. I pay more attention to what the AO tells me divergencewise.
Attached Image (click to enlarge)
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The Essentials of Trading: Emotions, Risk Mgt, Price.
  • #364
  • May 28, 2009 6:43am May 28, 2009 6:43am
How is everyone handling the no-hedging rules with their brokers? With my broker I can no longer have a stop and reverse type trade or cannot bracket a ranging market waiting for the next breakout.
  • #365
  • May 28, 2009 6:49am May 28, 2009 6:49am
by the way rcwso. I was short and long at the same time on gbpjpy yesterday and nothing happened... guess that's due to the broker?! idk
The Essentials of Trading: Emotions, Risk Mgt, Price.
  • #366
  • May 28, 2009 6:52am May 28, 2009 6:52am
Must be the broker. My broker sent out an email that said a way to combat this problem was to open two accounts. The catch is that you have to put money into both and margin rules apply to both. So, it looks like another way for them to possibly make some more money on people that go in too big or don't pay attention enough.

Are you day-trading today?
  • #367
  • May 28, 2009 7:05am May 28, 2009 7:05am
yes trying this and that. lets see how the day will end
The Essentials of Trading: Emotions, Risk Mgt, Price.
  • #368
  • May 28, 2009 8:36am May 28, 2009 8:36am
Sight, Thats a great point about the AO.
  • #369
  • Jun 24, 2009 12:20am Jun 24, 2009 12:20am
Hi,
Here is my last EURGBP order on daily chart.
W1 have been taken yesterday @0.8493 but my trailing stop closed the order a few hours later @0.8558. Now waiting for W3 entry.


Attached Image (click to enlarge)
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Chaos Trader
  • #370
  • Jun 24, 2009 11:02pm Jun 24, 2009 11:02pm
Hi, I am studying Dynamic Trading Strategy (Robert C. Miner), and I learned Max Trading Strategy (Jim Pruit, just past away). Both strategy are swing and break out (on swing) trading.

What I learned from both, they don't use fix setting on the oscillator. you can combine any indies (Macd, Stoch, RSI, etc.), as long you can see the "REVERSAL". Well, I found DTOSC is still the best to indicate OB-OS reversal. But Stochastic is also good. So, Miner said, the name of indicator and the setting are not the big issue.

1. Using Dual Time Frame (TF), Use Higher TF for Trend and entry using lower (or more lower). the point using lower TF for entry is finding the smaller stop loss below the previous swing low for buy entry. So, The Entry is also the main the issue, but Stop loss.

2. Name the "Probable" pattern in higher TF. It doesn't matter if it is 5 waves, ABCDE waves, or (min) ABC wave/correction + Fib Note. Base on those information we should find the *probable* trend and resistance. Miner said, the Elliot Wave doesn't have to be perfect Wave, and we don't need too deep in E-Wave.

3. Use shorter setting for Higher TF, where you use for trend analysis, and Use longer setting for Lower TF. This is the important point (my own opinion - the book says nothing). We use longer setting in lower TF to see if the entry is still in trend or not (specially when use fractal as entry)

4. I add GMMA series in higher TF to filter the trend, specially when it on 5th wave and make ABC correction.

Exit ---- (for Buy), shift the (profit) Stop-loss on below the low bar where the price reach the important fib-note, specially when the oscillator is in OB or Bearish Reversal.

Well, that what i learn from those 2 swinger trader. I think we can use it on DiNapoli Strategy too, since the author don't teach clear entry strategy in his book.

Let's share more strategy.
  • #371
  • Jun 24, 2009 11:17pm Jun 24, 2009 11:17pm
kissaki, So how does that apply to Chaos trading? How can it be incorporated to improve Chaos with Bill Williams?

Thanks,
RCWSO
  • #372
  • Jun 24, 2009 11:19pm Jun 24, 2009 11:19pm
Your best ones will be with the AO strong though. Only way to be any way close to sure is shoot a couple of fib projections off the previous major wave and the last minor wave. The fibs determine the fractals. If they cluster, you've got your wiseman. Even then you may get a stop run that goes above the wiseman. No way to be 100% sure in Forex.
Quoting Slight
hi greenriver,
I have put the arrows in your chart as I would have drawn the angulation (red arrows); hence I see angulation... The way I draw the lines is: where did the price move - where did the "middle of the blue and the red line of the alligator move." Most of the time the lines I draw do not cross.
The reason I do not like this divergent bar is the AO. It is at its peak and the trend could continue further up in what could be wave 3?! When I try to take divergent bars it's mostly those with divergence in the AO. But I guess this is to...
  • #373
  • Jun 26, 2009 1:56pm Jun 26, 2009 1:56pm
Hi Everyone

I just ordered 2 Chaos books - highly recommended by a fellow trader. I went through the forum postings since 2007. My heartfelt thanks for your sharing.

Will the system work well for options/futures trading? I am also planning to trade USD/CAD in the very near future though I will need to learn more.

Will count on your support/guidance once I start reading the books. Thank you in advance.

Have a nice Fri/relaxing weekend.
  • #374
  • Jun 26, 2009 6:30pm Jun 26, 2009 6:30pm
Good start. The Williams certainly trade commodities and stocks with it. Bill mostly trades commodity ETFs with it at presence. So I would think it would work for options as well, but I have no experience with this area. Definitely will work with USDCAD.
Quoting wgreenie
Hi Everyone

I just ordered 2 Chaos books - highly recommended by a fellow trader. I went through the forum postings since 2007. My heartfelt thanks for your sharing.

Will the system work well for options/futures trading? I am also planning to trade USD/CAD in the very near future though I will need to learn more.

Will count on your support/guidance once I start reading the books. Thank you in advance.

Have a nice Fri/relaxing weekend.
  • #375
  • Jun 27, 2009 9:15am Jun 27, 2009 9:15am
Your prompt response has confirmed that I am "finally" on the right track. Thank you. Have been trading stocks/options since 2006 and paid advisory vendors for stock/option picks. Lost over $100K as they do not have an exit strategy. Stocks/Options fell from $ to pennies and they still asked the customers (incl me) to hold on. I was stupid not having any IL orders to minimize the loss and/or protect my gains .. sigh ..

Finally this year I decided to be my own financial advisor and find my own trades once I am competent to do so I must add. Completed some training programs on options and futures and can't wait to do consistent successful trades soooon! I've become a "full-time" trader (to be polished) after getting married and relocated to a small city.

Am glad to learn about the Chaos books and it's a nice surprise to locate this Chaos forum where users are willing to share and guide the new learners like me. It's very hard to have no one to turn to. I am thrilled that I am not alone in this new venture. Thank you .. Thank you.

I just went through the Alligator System Set-up - I forgot to write down the name of the Forum member - Thank you. Will visit another link capturing the system overview this weekend. Can't wait to read the books and apply the learned knowledge to locate Successful trades.

Have a Great weekend everyone.
  • #376
  • Jun 27, 2009 12:01pm Jun 27, 2009 12:01pm
Quoting taxgeek
Good start. The Williams certainly trade commodities and stocks with it. Bill mostly trades commodity ETFs with it at presence. So I would think it would work for options as well, but I have no experience with this area. Definitely will work with USDCAD.

hey mate ....i had to vouch you..keep the good work..
MY OPINION NOT FINANCIAL ADVISE
  • #377
  • Jun 27, 2009 6:59pm Jun 27, 2009 6:59pm
Thanks.
Quoting donfriday
hey mate ....i had to vouch you..keep the good work..
  • #378
  • Jun 28, 2009 9:22am Jun 28, 2009 9:22am
Hi Believe all of you are enjoying a great weekend. I did lots of reading on the Chaos system. How and where can I learn how to set up the indicators such as the Gator, AO and AC etc? Please help me! Thank you.

Have a Nice Sun/Successful Week ahead.
  • #379
  • Jun 28, 2009 12:09pm Jun 28, 2009 12:09pm
Quoting wgreenie
Hi Believe all of you are enjoying a great weekend. I did lots of reading on the Chaos system. How and where can I learn how to set up the indicators such as the Gator, AO and AC etc? Please help me! Thank you.

Have a Nice Sun/Successful Week ahead.
you will get answer ....
http://www.forexfactory.com/showthread.php?t=175762
MY OPINION NOT FINANCIAL ADVISE
  • #380
  • Jun 28, 2009 7:32pm Jun 28, 2009 7:32pm
Hopefully some of you caught the nice up move on this pair. Started out with a wiseman (at the appropriate fibonacci fractal area, good angulation too, if you don't mind that kind of subjectivity). SAO came along about the right time to get smacked by wave 2, which is why I don't use it. I look for support at the end of that wave 2 before adding. After that really nice fractal add ons. Only question now is how far it goes before a larger wave 2 knocks it down again. To answer that question you will see that I have drawn in several sets of fibs. The light blue ones are a fib expansion of minor wave 1 (of either wave A or 1. I don't care which.) The purple set is an alternate price projection from minor wave 1. The red set is a retracement price projection of minor wave 2. The purple, green, and light blue ones repeating in the background are absolute fibonacci lines and represent the true fractal development of price movement. Bill Williams fractals are nothing but price patterns. They don't mean much. If you look at the chart, there are a lot of them on this chart, but there are only 3 real fractal patterns. Good for about 3000 pips. If you go to the Silent Service Thread and follow their method of drawing s&r lines on the monthly and weekly charts, you will wind up with a similar pattern within a few pips. This too will help you see the real fractals. It looks a bit messy, but the idea is to build a spider web for price to move in. I'll add another retracement price projection when the minor wave 4 completes that will even more exactly pinpoint the end of the minor wave 5 and the point to take profit. I basically do the same to pinpoint entries. Once we see a wave 2 or B form (I won't trade it.), we may be able to tell if this is an abc or a new trend. This is pretty much how I've combined Chaos with a couple of other things to make it more accurate. I tend to stick to the daily bars. Shorter term charts don't allow the kind of analysis that I've done here at least not comfortably.
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