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Bill Williams Profitunity Chaos Trading

  • #301
  • Oct 1, 2009 6:23pm Oct 1, 2009 6:23pm
Hi Slight, thanks very much for your charts and analysis I really appreciate it! Seems we are in opposite parts of the world but I am enjoying checking your replies in the morning when I get to my desk.

For the E/U chart you posted, I would have taken none of those losing trade, since the candle which formed the fractal did not form outside the alligator.

You did spot some losing G/J trade I would have not taken the first one or third one for the same reason as above, and yes the second was a loser but in the same area I see several other BW saucer trades and similar which are winners.

I am not trying to say this system cannot win, just that I found your statement very hard to believe "using BW mechanical I had only losers".

I also make a point of taking half off at 1:1 so all trades at 1:1 are "free" if that makes sense, this is the best way to use this system IMO, so you can really stack free trades up it makes you capture a huge portion of the daily wave.
  • #302
  • Oct 2, 2009 3:15am Oct 2, 2009 3:15am
Interesting to see how differently people use the same system. I am trading the fractals that are created below the red line and triggered below the red line. Obviously, you wait for fractals outside the Alligator. Everyone seems to tweak the methodology to their liking
Well, I am not a big fan of adding a lot of indicators or "orientation" stuff to my profitunity charts. I don't draw any lines nor do I use fibos... After being with the system for quite a while I know how to look at it for my understanding of the market and I follow it in this way (which are the dynamics of the waves combined with the div bars and fractals). A fellow trader from my area uses the Chaos system as well but combines it with candlesticks formations ... and he doesn't make more or less money .. it's just a different approach.

Well, I wasn't exactly saying you only lose if you follow it mechanically. I said, it isn't profitable if you follow it mechanically. Meaning, you might barely break even or win only a little. I still think this is true - from my own experience As I said above though, seems you need to tweak and really comprehend the way the system applies to the markets first.

Taking trades off like this .. hm .. I don't know .. I like to follow the market and only do what I am suppossed to do. It sound as if you are squeezing out the pips of the market .. that's not really my kind of thing. I simply take the signals as they come not risking too much of my account and then I get out when the market tells me to. Sometimes I have a lot of positions, sometimes I have only one. Sometimes I win, sometimes I lose but not expecting more than what the market has to offer in this or that certain move.

Good Trading.
The Essentials of Trading: Emotions, Risk Mgt, Price.
  • #303
  • Oct 2, 2009 4:32am Oct 2, 2009 4:32am
Quoting Slight
Interesting to see how differently people use the same system. I am trading the fractals that are created below the red line and triggered below the red line. Obviously, you wait for fractals outside the Alligator. Everyone seems to tweak the methodology to their liking
Well, I am not a big fan of adding a lot of indicators or "orientation" stuff to my profitunity charts. I don't draw any lines nor do I use fibos... After being with the system for quite a while I know how to look at it for my understanding of the market and I follow it in this...
Hi Slight,

Thanks for your continued replies. For once I am using the internet at home so I can reply to you directly.

I will try to reply to your post in the three parts it is divided into:

1. I don't add any extra indicators or orientation to the chart (except ZigZag maybe). Alligator MAs, AO, AC, MFI & Fractals. All the trades indicated above were using BW original Chaos signals, you can check them on Alpari Academy website to confirm saucer trades etc. We can maybe use Murray Maths Lines or Fibos if we are scalping on M5 or something but otherwise I feel no lines are necessary.

2. I am glad you clarified it for me, because to me this is one of the strongest virtues of BW Chaos: keeps your losses small until you hit the big one so I was surprised to hear only losses from you especially since your +900 G/J chart I saw somewhere.

3. IMHO this is the best trading technique next to using buy/sell stop/limit orders (which is something BW introduced for me the first time). Maybe you didn't understand the technique I will try and elucidate:

You get an example signal for E/J at 123.45 to sell limit with SL at 124.56 (max risk = 111 pips). So instead of place one sell limit we place:

SELL #1 @ 123.45 SL 124.56 TP open
SELL #2 @ 123.45 SL 124.56 TP 122.34 (1:1 R:R)

Total risk for BOTH trades being 1% or whatever % of your available margin you are comfortable with risking.

What this ensures is that if the trade makes it to 1:1 we are in a free trade on the other contract without adjusting our SL (move to BE often gets stopped out on retrace before moving back in favour).

This is not as you said "squeezing pips out of the market" in fact, it is the opposite as a famous FF trader Peter Crown once said "ensures each trade stands on its own", plus, it means from 1:1 you don't care about the trade anymore risk to your balance is 0 you can forget about it and let them stack up!

This is what BW meant by "capturing 80% of the wave" I believe!

Cheers Slight, enjoying your input.
  • #304
  • Oct 2, 2009 4:58am Oct 2, 2009 4:58am
I'm still waiting for the outcome of nfp and other news ....eu weekly look good if any of u check out.
Attached Image(s) (click to enlarge)
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MY OPINION NOT FINANCIAL ADVISE
  • #305
  • Oct 2, 2009 5:04am Oct 2, 2009 5:04am
Hi don, do you mind posting the chart mate I am on very slow internet on my room-mates computer, with no charting access. Would like to see what the hell is going on!
  • #306
  • Oct 2, 2009 5:04am Oct 2, 2009 5:04am
Quoting sinner-
2. I am glad you clarified it for me, because to me this is one of the strongest virtues of BW Chaos: keeps your losses small until you hit the big one so I was surprised to hear only losses from you especially since your +900 G/J chart I saw somewhere.
I never traded anything else but the BW system. I don't have a clue how to draw lines, read candle stick patterns or whatever. It seems it took me a while to understand how the market moves looking at it from the eyes of the BW system. I think everyone who first gets started trading needs to develop this basic understanding of market structure.
What I want to say is, when I just applied the system having no understanding of market structure, I lost more than I gained. By now this is different, which is the reason why I am able to pull of things such as the gbpjpy trade to name one.

Quoting sinner-
3. You get an example signal for E/J at 123.45 to sell limit with SL at 124.56 (max risk = 111 pips). So instead of place one sell limit we place:

SELL #1 @ 123.45 SL 124.56 TP open
SELL #2 @ 123.45 SL 124.56 TP 122.34 (1:1 R:R)
I understand better now, thanks for clarifying it. I also see how this is a good idea and can work great.
I guess it is the style that makes us different. Here is the reason why I don't use it like you do: your 2 trades are going to work good, and if you could set up 5 position to do that, even better. But you know, what happens if the trend never unfolds and you get stopped out? What was your extra profit before is now an extra loss. Maybe you are pretty safe in applying this technique, but leverage would get too big for my taste. Also, you set a TP on one of the 2 positions. I don't like that, because I found myself in the "Had I just let it run" - state when I TP on a position that would have been good to go further. Therefore, I simply put on one position for initial entry, as soon as the market tells me that the trend continues, I put on more lots and I let all of them run until the trend is over.

You catch 80% of the trend when you can spot a good entry and then let this one position run until you get an exit signaling. An initial breakout fractal entry will, so to speak, give you those 80% of the trend if you don't exit too soon. You can increase that percentage to, I dunno, about 200-300% if you add up and let all of your trades go to the very end of that trend. That's how I look at it and it took a while to arrive here However, for me, my accountsize and my understanding of what is happening in the marketplace this is how I want to go ... oh, and btw I only trade dailies, no intraday. I know that what I just explained doesn't work out as nicely intraday (in case you are more of a daytrader.)
The Essentials of Trading: Emotions, Risk Mgt, Price.
  • #307
  • Oct 2, 2009 5:05am Oct 2, 2009 5:05am
this thread is getting better.
  • #308
  • Oct 2, 2009 5:13am Oct 2, 2009 5:13am
Quoting sinner-
Hi don, do you mind posting the chart mate I am on very slow internet on my room-mates computer, with no charting access. Would like to see what the hell is going on!

Well bro my plan as been eu sell when it was 48 but i got stopped out ...
I need to enter from small time frame but in a mid term eu should hit 42 ....
chaos signal on eu bigger tf is sell no buy until something else happen..
Attached Image (click to enlarge)
Click to Enlarge Name: eu.png Size: 30 KB
MY OPINION NOT FINANCIAL ADVISE
  • #309
  • Oct 2, 2009 5:17am Oct 2, 2009 5:17am
Hi don, thanks for the chart bro.

My advice: wait for wiseman 2 + super AO on the daily and weekly. Then it will be safe to short.
  • #310
  • Oct 2, 2009 6:11am Oct 2, 2009 6:11am
Quoting sinner-
Hi don, thanks for the chart bro.

My advice: wait for wiseman 2 + super AO on the daily and weekly. Then it will be safe to short.

hmm the entry will be in small tf not weekly ...Lol
MY OPINION NOT FINANCIAL ADVISE
  • #311
  • Oct 2, 2009 6:12am Oct 2, 2009 6:12am
Quoting donfriday
hmm the entry will be in small tf not weekly ...Lol
GL bro! I am not there yet with this system to enter swing trades on small TF.
  • #312
  • Oct 2, 2009 11:21am Oct 2, 2009 11:21am
can you enter a valid wiseman2 if you didn't get a valid wiseman 1?
Thanks,
steve
  • #313
  • Oct 2, 2009 11:35am Oct 2, 2009 11:35am
Quoting stevewide
can you enter a valid wiseman2 if you didn't get a valid wiseman 1?
Thanks,
steve
sure bro...if u miss the entry and see change of AO place ur pending order ....
MY OPINION NOT FINANCIAL ADVISE
  • #314
  • Oct 2, 2009 12:27pm Oct 2, 2009 12:27pm
I've studied this before and struggled taking signals mechanically on 5m chart. I'm considering looking at higher TF's this time and enter on 5m chart in their direction.

Murrey Math is really great on the lower TF's. I don't do well with fibs and trendlines as I see so many different ways to draw them so tend to use automated indy's. Any advice on this would be greatly appreciated.

God bless,

Steve
  • #315
  • Oct 2, 2009 12:44pm Oct 2, 2009 12:44pm
Quoting stevewide
I've studied this before and struggled taking signals mechanically on 5m chart. I'm considering looking at higher TF's this time and enter on 5m chart in their direction.

Murrey Math is really great on the lower TF's. I don't do well with fibs and trendlines as I see so many different ways to draw them so tend to use automated indy's. Any advice on this would be greatly appreciated.

God bless,

Steve
i prefare 1hr chart for my entry, but sometime on less volatile pairs i can use 15tf as max for me....u can use any thing that work for u at target i used math murrey before it and it cool, i am cool with fibo and i am have some experience with trendlines...
my trading style is many so i do the best i can to max my profit ..
cheers and i wish u all peaceful weekend.
MY OPINION NOT FINANCIAL ADVISE
  • #316
  • Oct 2, 2009 12:56pm Oct 2, 2009 12:56pm
Quoting stevewide
can you enter a valid wiseman2 if you didn't get a valid wiseman 1?
Thanks,
steve
According to the latest word of Bill Williams: no. Wiseman2 is an add on entry only. If you look at the pdf of the interview by Trout on the profitunity site, there are only two correct entries: wiseman1 and the fractal breakout above the red alligator line. This would be especially true in a correction, I think. Remember profitunity is about trading trends.
  • #317
  • Edited Oct 3, 2009 3:35am Oct 2, 2009 1:14pm | Edited Oct 3, 2009 3:35am
Quoting taxgeek
According to the latest word of Bill Williams: no. Wiseman2 is an add on entry only. If you look at the pdf of the interview by Trout on the profitunity site, there are only two correct entries: wiseman1 and the fractal breakout above the red alligator line. This would be especially true in a correction, I think. Remember profitunity is about trading trends.

yeah i think u make a point ...most of the time b4 wiseman 2 come price already inside alligator mouth and such signal cant be taking ..
long time bro sup with u?
MY OPINION NOT FINANCIAL ADVISE
  • #318
  • Oct 2, 2009 1:43pm Oct 2, 2009 1:43pm
oh; I better practice with 1h; thanks
  • #319
  • Oct 2, 2009 3:45pm Oct 2, 2009 3:45pm
Quoting taxgeek
According to the latest word of Bill Williams: no. Wiseman2 is an add on entry only. If you look at the pdf of the interview by Trout on the profitunity site, there are only two correct entries: wiseman1 and the fractal breakout above the red alligator line. This would be especially true in a correction, I think. Remember profitunity is about trading trends.
I very much second that !
The Essentials of Trading: Emotions, Risk Mgt, Price.
  • #320
  • Oct 3, 2009 8:59am Oct 3, 2009 8:59am
Quoting stevewide
oh; I better practice with 1h; thanks
go ahead and do it , i also like picking enrty on 1hr but u cant get wiseman2 signal in 1hr so easily cus by the time AO 3rd green price will be in alligator mouth and such signal is ignore..
i look forward to ur post and see ur improvement...
MY OPINION NOT FINANCIAL ADVISE
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