Indicator complier and scorer - Live trade assistant, Not EA

Hi everyone

I have been trading using a variety of indicators. Listed below:

Pattern Recognition Master 3
Trend Magic
Super SR7
MACD

I have been trading the EUR/GBP only, and looking for at least 3 of the above 4 indicators to suggest a forming trend on both the 30 minute and 1hr chart. I am trading between 2pm - 5pm GMT to look for liquidity between the UK and US markets.

I have had some success so far, and am understanding more every day.

I've been considering the idea of creating a team to work on some sort of indicator compilier. Software that looks at the output of these (and perhaps further) indicators, and gives them a score. This is arbitrary, so for the sake of clarity lets make it:

-100 to +100

-100 is a definative sell trend, +100 is a definative buy trend. All other numbers are proportions of the same.

The compiling indicator would take the sum of these and create an average. With custom alerts given when the average reached a certain amount (for instance +75 overall).

Some important points of such an indicator would be:

 

1. The ability to weight the value of individual indicators in the final 'averaged' score. For instance we may decide that MACD on the 30min chart is of low importance, so give it an overall score of 5% (so its figure makes up 5% of the final 'average'), and believe that Trend Magic on the 1hr was of high importance and give it 20%.
2. Adding further indicators to the above, or taking ones away. As the team decides, and as works for peoples trading styles.

I would like to work either with a small group of people to do this 'off board', or alternatively throw it open to the community and if people think its a good idea we could run with it here. We would need to create the indicator, along with deciding on which indicators to use with it, what weight to give each indicator and so on.

Personally I am more interested in live trading rather than EA's, but would be happy to see people going down that road too.

Any thoughts, ideas or criticisms will be gratefully recieved!

David

it seems an appreciable amount of history data is needed to weigh up the proportions. How exactly are you going to do that?

Sounds like more machine learning.

I think this is possible by using existing traders experience. I have fairly low trading experience, but still have a good idea which indicators mean the most to me out of the ones I have on the screen, which ones I am most confident in, and which I am using as 'backup', to help confirm the suggestions being made by the ones I would consider primary.

Again, I am not looking at an EA here, rather a way of combining the indicators we use daily. In my mind this would require a human to make the final decision.

A simpler form would be to simply give a list of the score presented by all the indicators, along with an average. And let the trader decide for himself if the score is worth acting upon.

For instance an indicator he feels is very accurate gives a score of +40, but one which he feels is least accurate gives +90, so bringing the average up. This trader may decide to not act upon the trade as the bulk of the positive score is coming from a lesser indicator.

Please explain

I ain't using any of the indicators you've mentioned here so I put the pattern recognition master v3 into a chart, but it doesn't seem quite indicative.......

Hi

Yeah, I've been debating that one myself. I would certainly consider it to be one of the ones I would weight quite low. It factors in my decision making to a small extent if it is giving lots of consistent indications, but I would not trade on account of it alone.

The actual indicators to be used for something like this are of course up for discussion. I gave ones I have been working with as examples.

The trading style etc also would have to be discussed, this obviously effects the indicators used.

Personally I have been trading as follows:

 

1. EUR/USD - (please ignore the error in OP, I put EUR/GBP which was incorrect.)
2. Trading from 1pm - 4pm GMT, or 2pm - 5pm BST to look for breakouts in the US/UK markets. I am not normally taking any new trades after 3pm GMT
3. I have closed all trades before the close of UK trade, indeed most are closed within an hour of opening.

hey david.... that sort of thing is easy in mq4..... we have those in abundance now..... both as indicators and ea's..... some placed on any chart will slowly scroll thru all pairs..... some add across all timeframes.... some add specific groups of pairs, such as all jyp's..... so on and so on.....

the basic intent is to sum up all factors in an attempt to generate signals.......


with imagination the possibilites are almost endless......h

Hi

Looks good, can you recommend a couple, in particular indicators which I could edit?

David