Lost in the Tunnel...

Hi zupi,

Thanks for ur attention. Here I attached a 4 hour chart with vegas 4 hour tunnel. Thanks again..

The blue line is 55 SMA, the red are fib levels and green is 8 SMA, who signal when to enter.

hi c1ro,


i just see your attachment and im not surprise if you confused...

Basically what i can say is you make your chart too complicated by applying many analysis together, my advice is u may have many method in ur mind bt in order to study vegas method u must use ONLY what vegas ask to do until you can understand then u can apply other analysis if you want to improve more...

For example just create 1 4hour GBP/USD chart either bar, line or candle, but i prefer candle because its gave me a lot of information, apply vegas risk model 1 and 3, then add 55SMA (H+L)/2 and 8SMA (close)

Im refering to my chart which i will attach together, if you analyze the chart, 8SMA will closely follow the market compare to 55SMA and in my understanding there would be few circumstances happen, and the most important things we need to see is the value of 8SMA and 55SMA every 4hour candle. Ussually wat i will do is if market on uptrend i will closely follow this 2 SMA line,

if market continuesly move up the value of 8SMA of last completed 4hour candle will more then the value of 8SMA at previous candle, i hope u understand this statement, i will follow the market until the next completed candle and if the 8SMA keep increasing i will keep watching, there would be a moment 8SMA stop increasing value and u will find the value of 8SMA is same as previous 8SMA, this is place we need to watch closely

when 8SMA value is same as previous 8SMA value its mean the market might have changes in trend so what i will do is i will check and compare the value of current 55SMA compare to previous 55SMA value, if the value keep increasing eventhough the value of 8SMA is level with previous i will continue watch market bt if the value of 55SMA stop increase same as 8SMA its mean market will change the trend.. either i will close my position or close part of position its depend on which fibo level i am...

ok, for make my trading more simplify wat i will do is ussually i will write down on paper value of 8SMA and 55SMA on each completed 4hour according to market. another thing i will watch is the different with current gap between current 8SMA and 55SMA compare to gap of previous 8SMA compare to 55SMA, the closer the gap mean chances the market change trend is very high....

i hope this explaination would help you much, this purely my understanding about vegas method and it might have some mistakes so hope if anyone have better way of understand vegas method i will more happy to learn that as well

i will attach my graph together with FF tunnel which i use for this chart, actually this FF tunnel i get it from this forum and im just resend again.

[quote=sundra]hi c1ro,


i just see your attachment and im not surprise if you confused...

Basically what i can say is you make your chart too complicated by applying many analysis together, my advice is u may have many method in ur mind bt in order to study vegas method u must use ONLY what vegas ask to do until you can understand then u can apply other analysis if you want to improve more...

For example just create 1 4hour GBP/USD chart either bar, line or candle, but i prefer candle because its gave me a lot of information, apply vegas risk model 1 and 3, then add 55SMA (H+L)/2 and 8SMA (close)

Im refering to my chart which i will attach together, if you analyze the chart, 8SMA will closely follow the market compare to 55SMA and in my understanding there would be few circumstances happen, and the most important things we need to see is the value of 8SMA and 55SMA every 4hour candle. Ussually wat i will do is if market on uptrend i will closely follow this 2 SMA line,

if market continuesly move up the value of 8SMA of last completed 4hour candle will more then the value of 8SMA at previous candle, i hope u understand this statement, i will follow the market until the next completed candle and if the 8SMA keep increasing i will keep watching, there would be a moment 8SMA stop increasing value and u will find the value of 8SMA is same as previous 8SMA, this is place we need to watch closely

when 8SMA value is same as previous 8SMA value its mean the market might have changes in trend so what i will do is i will check and compare the value of current 55SMA compare to previous 55SMA value, if the value keep increasing eventhough the value of 8SMA is level with previous i will continue watch market bt if the value of 55SMA stop increase same as 8SMA its mean market will change the trend.. either i will close my position or close part of position its depend on which fibo level i am...

ok, for make my trading more simplify wat i will do is ussually i will write down on paper value of 8SMA and 55SMA on each completed 4hour according to market. another thing i will watch is the different with current gap between current 8SMA and 55SMA compare to gap of previous 8SMA compare to 55SMA, the closer the gap mean chances the market change trend is very high....

Hi Sundra,

I think we still have different chart. I can see yours has the upper line which is closer to the candle. And look at the number of MA+2 and so on, they show different price level between your and mine. And actually I dont know how to read the tunnel itself when the price level is too far from the tunnel as u can see in mine. Hope u can understand what I'm trying to say

Hello Everyone,

I have recently studied this thread and have to conclude that it is one of the most enlightening things on this forum. It is very good to see how people's curiosity and drive for improvement leads to new ideas on old systems.

I was wondering whether anyone here is still active in improving on the Vegas methods. I know that diallist's knife rests heavily on tunnel trading. But apart from that has anyone over the last months/years done some other work with new ideas?

For instance, I have played around with the 1h system recently and tried to find some additonal filters to avoid the chop. I observed that ususally the best signals are those where the breakout is accompanied by strong momentum and a build up in volatility. Hence I applied a simple rule which states only to take break outs when 8 period ADX slopes strongly upward and the bar breaking the tunnel closes at or higher than a 5 period outer Keltner band. This seems to improve the system in the sense that not as many positions will be opened and stopped out. I have not done any backtetsting but am demoing it and results seems to be ok. As the system will tend to take more advanced moves I actually take away more than just 1 lot at the first fib level.

Well, anyway, I was just wondering whether anyone has done similar things and has any promising results. Just to revive the discussion. Hope to hear from you.

Best

I notice reading the thread a lot of changes from begining to end . I wonder what are the experts here using for daily weekly hourly. can someone post the last meta files being use tks

I've been looking at the Vegas Systems and am currently looking at the Vegas 4 hour system.

This strategy originally took 4 hour trades where the momentum turned back in the direction of the weekly trend. A modification added (effectively) a daily overbought/oversold measurement and permission to trade against the weekly trend if daily was overxxx'd and price action supported it.

One way to quickly improve Vegas is to use Hull Moving Averages instead of Simple Moving Averages for the weekly and 4 hourly signal (short) mas. Tune the Hull so that it gives no more false signals than the simple ma and you will find it usually gives its signal 1-2 periods in advance of the sma.

This is usually a faster result than even the "predictive" use of the sma turning points and avoids the risk of reversal on close when predicting.

Merry Xmas Everyone

Hello everyone,

Still working on this system? have you tried to apply any more powerful filters on the system?

Vegas said

"If the difference between the 21EMA and the 5 EMA is > 500 pips, then the pip difference from the prior week must change by more than 10 pips, or just go lower over 2 consecutive weeks, to signal a trend change."

I think this means when the weekly momentum is too strong, more price reverse needed to confirm a trend change.

But there is no filter for weak weekly momentum, when weekly momentum is weak, the gap between the 21EMA and the 5 EMA close to 0, maybe a lot of false signal will be produced.

Any thoughts?

Another thought about the signals, Vegas said "when 8 SMA will not be above/below the 55 SMA" only take half unit positions. So those signals are not as good as standard signal. But when the trend is very strong, the retracement maybe can not push 8 SMA back above/below 55 SMA, miss some chances reenter the trends? Any thoughts about this?

bump for greatness.

The conversations between Diallist, Heavy J, and quite a few others make this thread a must read. For the basic relation to the 4 hour method, posts 25, 381,382, 383, and 449 are excellent.

I don't believe that I found this discussed, however, the trick with the 8 sma can be replicated with the 5 sma (on the weekly chart) if you are following the "purist" view of this method still. Go 5 bars back and the when price moves to the close of that area, the sma is now "neutral". This just helps a bit IMO.

As a matter of fact, there was a short trade initiated last night based on the method. Personally I love taking the vegas dynamic fib areas as areas of take profit, and ALSO areas to look for reverting price action to trade back towards the 28 ema tunnel and subsequent fib levels on the way back up to it.

It's also useful to look at price action in order to maintain your position along the way. For instance, today there was a continuation pattern on the eur/usd 4 hour after the signal was given- this will be used to place stops lower (above the bar) and reduce risk further. I'll be trading that until the first fib, with profits locked in after and then letting them ride to the consequent dynamic fib areas thereafter.

On the weekly, we saw, 5 weeks ago, the bearish bar to initiate shorts (for me) at a solid area of S/R.

I enjoy using these dynamic fibs as areas of take profit as well, because the further the trade progresses, the further they progress. As the market continues to go lower, so will they. This, in relation with price action, is a fantastic way to exit positions.

If a pin comes up before a fib level comes up and closes your position, what do you do? Duh, you close for profit. I do anyway, because that means that the chances of getting there are much less than before. Why walk away with B/E when you can still walk away with 100 pips bagged?

I'll be posting more as I get my charts set up later tonight. (I'm on vacation and not on my regular computer lol) Some friends will be over later so I'm gonna go get pretty for the time being. If anyone would like to add anything, feel free to comment or call me an idiot for my thought processes. I'd appreciate feedback with ways to enhance our trading even further yet. Have a good one ladies and gents.

In the meantime, Dial's posts are golden on the trend changes and entries, especially on the 50 rule and others. Just read em all. Don't shortchange yourself.

test

I don't know if the fib levels are correct since I had to modify the indicator to work in the latest build of mt4.

It looks like GBP/USD has hit resistance on this chart. Also hit resistance on the daily. Is a retracement coming shortly ?

Hi all .

I am just checking if my indicator "FF Tunnel chart" from this website. Does it shows the right direction on weekly chart EUR/USD?

In my opinion it should be UP. Am I right?

Thank you.

GE.

Hey guys anyone still trading this? I read that Vegas stopped trading it and his wealth builder. I was just fooling around trying to code this up for tradestation and so far the results after 2006 were not very good. I know there is a "knife" version out there but I'm wondering if anyone is trading any of these latey.

peace

Bumping to bring it back up, maybe get some fresh interest ?

While here, if this thread gets any fresh interest...please, please read the thread from the beginning all will be revealed, after all it ain't amounting to thousands of pages of reading.

I have lost count of the amount of posts I have read in this thread asking the same old thing...what does PF mean ?, how do I plot the active Fib lines ?, what are the active Fib lines for ? etc etc.
These questions arise time and again and are obviously from people who couldn't be ar@ed to read the whole thread and jump right in wanting people to spoon feed them the answers.

Sometimes things need to be explained by people who have a good grounding in the method, but asking simple questions (such as - what does PF stand for) that have been asked and answered numerous times in previous pages is "sheer lazyness".
"Rant over", lol.