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Building an equity millipede

  • #521
  • Aug 2, 2010 12:31pm Aug 2, 2010 12:31pm
Quoting pipEASY
Game rules

1. We enter 2 positions at each arrow
2. Both position -100 pips hard stop loss
3. 1 position closed @ 1:1 and the remaining position let it run with SL still at -100
4. All positions closed at 'X'

I have worked out the fate of each 15 positions.

All you need to do is choose 8 random numbers. Must be 'random'

Add the pips together and please post a reply in the thread.

http://img337.imageshack.us/img337/8398/gamei.png

Purpose of this game shows...
Hi Graeme,

As ever great thread, and great insights into the way you look at the market.


Here are my random entries;

1,3,6,8,9,10,12,13

Total pips 2500
  • #522
  • Aug 2, 2010 12:43pm Aug 2, 2010 12:43pm
My random numbers are
8,6,5,4,10,13,2,1
it gives total 2100
  • #523
  • Edited 3:17pm Aug 2, 2010 2:01pm | Edited 3:17pm
Hi Graeme,

Excellent thread. I am so glad I found it. I already have some legs of my millipedes going. By using your system I am learning to not try anticipate the market. To just go with the flow. Seems like a no-brainer but I now realize I was making that simple mistake far too often by using other trading methods. Your system forces me to think that way.

One question if you can find the time to answer. You mentioned you trade about 20 pairs. What pairs do you trade besides the 12 majors? Do you take into consideration some of the characteristics of the pairs? For example, looking at weekly charts of the pairs, it is obvious that some pairs tend to make larger moves over the course of a year or two than others. Some pairs can be quite volatile on daily time frames which in my mind requires larger SL to participate or a willingness to accept more losses.
  • #524
  • Aug 2, 2010 2:21pm Aug 2, 2010 2:21pm
Quoting pipEASY
Game rules

1. We enter 2 positions at each arrow
2. Both position -100 pips hard stop loss
3. 1 position closed @ 1:1 and the remaining position let it run with SL still at -100
4. All positions closed at 'X'

I have worked out the fate of each 15 positions.

All you need to do is choose 8 random numbers. Must be 'random'

Add the pips together and please post a reply in the thread.
The numbers I chose were 1,3,5,7,8,11,12,and 13.
The added pips came to +1800
  • #525
  • Aug 2, 2010 2:58pm Aug 2, 2010 2:58pm
Evening Graeme
Sorry for my absence and lack of homework but am a complete and utter imbecile when it comes to posting charts etc. A "How to post charts and write on them for dummies" would be good. Anyway on to your random entries. I would have traded chart exactly as is and would have taken entries 1,2,3,4,5,6,7,8. sending out scouts on retraces as you suggested earlier.
Absolutley love the thread and am learning all the time.
Kind Regards
Geoff
  • #526
  • Edited 3:32pm Aug 2, 2010 3:19pm | Edited 3:32pm
Quoting GEOFFREY62
Evening Graeme
Sorry for my absence and lack of homework but am a complete and utter imbecile when it comes to posting charts etc. A "How to post charts and write on them for dummies" would be good. Anyway on to your random entries. I would have traded chart exactly as is and would have taken entries 1,2,3,4,5,6,7,8. sending out scouts on retraces as you suggested earlier.
Absolutley love the thread and am learning all the time.
Kind Regards
Geoff
On Metatrader:

File>Save as picture

Wherever you save this on your computer is where you 'Browse' to below.

On this forum when creating a post at the bottom of your screen click on the button manage attachments>Browse>upload

Now 'submit reply' your comment as usual.

That's it!
  • #527
  • Aug 2, 2010 3:21pm Aug 2, 2010 3:21pm
Pls i want to know the indicator that's shown here. It'll help to determine the points of entry.
Pls can you just share it?
  • #528
  • Aug 2, 2010 4:13pm Aug 2, 2010 4:13pm
Quoting pipEASY
...To show you that:
1. you do not need to watch the same pair of currency everyday
2. you can enter anytime anywhere and still have same result
3. million different variations in participation but still one similar result
4. you do not need to over expose
Lets play a little game.
Just few congratulations Graeme! It seems to be so you know some of the biggest secrets of price movements...

I can confirm that on a next step, the absolute random trading is possible:
- you can randomly select several pairs (eg 6-10)
- you can randomly choose the direction of trade

Now, without even knowing which currency pairs are traded, you must only manage the positions:
- enlarge positions
- decrease positions
- close positions
- reverse positions

For the winning pairs you have only to watch the survival lifetime of the wins (win/ATR).
  • #529
  • Aug 2, 2010 5:58pm Aug 2, 2010 5:58pm
Hi Graeme,

My 8 trades were 1, 3, 4, 5, 6, 9, 11 & 14

4 Wins (3400pips) and 4 Losses (800pips) = Net 2600 pips

Chorlton
  • #530
  • Edited 8:14pm Aug 2, 2010 6:43pm | Edited 8:14pm
Had a good sleep & now learnt a bit about useing paintshop on charts.

Trend unknown at start of chart, then obviously down to end of chart.
Have marked some white lines as resistances, mostly from double tops & bottoms.
Limegreen lines for buy on RH end of lines. Orange for sell on LH end of lines.

Still need to find arrows in paintshop
31 entries over the 2 mths = 2 calendar days per trade.

Oops, also found that my bmp file that I got from FF was far to big to put back on FF. Tried a save as a gif file, now complies with FF limits. Really is quite a learning curve.

Noticed that T/L breaks on others charts are earlier entries than S/R breaks a lot of the time. Does add a little more subjectiveness in setting the T/L. Will be looking at these, especially for suspected turn entries. Getting in on trends very early reduces the pressure of DD when the area gets retested later.

cheers scalpz
Attached Image (click to enlarge)
Click to Enlarge Name: equity millipede post 467 20100802.gif Size: 43 KB
Target 2 : Stoploss in the green
  • #531
  • Aug 2, 2010 7:09pm Aug 2, 2010 7:09pm
i Graeme,
Interesting game.
i honestly picked random numbers 1.3.5.7.8.10.12.13.
now the breakdown of that is interesting.
only 2 of the 8 trades made all the money, 1 and 3. 2 losses 5 and 7, and the rest where BE.
interesting, the important thig is not so much how many positions you can get on, but to get some on when the trend is beginning, but to do that we do not know when it begins, we jjust have to place the trades and mangage our risk, and let time take care of the rest.

cheers
Geoff

Quoting pipEASY
Game rules

1. We enter 2 positions at each arrow
2. Both position -100 pips hard stop loss
3. 1 position closed @ 1:1 and the remaining position let it run with SL still at -100
4. All positions closed at 'X'

I have worked out the fate of each 15 positions.

All you need to do is choose 8 random numbers. Must be 'random'

Add the pips together and please post a reply in the thread.

http://img337.imageshack.us/img337/8398/gamei.png

Purpose of this game shows...
  • #532
  • Aug 2, 2010 7:33pm Aug 2, 2010 7:33pm
Quoting pipEASY
Game ....

All you need to do is choose 8 random numbers. Must be 'random'

Add the pips together and please post a reply in the thread.
...
Graeme
Well started off with 1,3,5,7,11 oops, run out of primes, but just those got to total of 1800 pips.

Then went 2,3,5,6,8,9,11,12 and they total 800 pips.

I like my 1st short list better, maybe that shows early entries are better.

cheers scalpz
Target 2 : Stoploss in the green
  • #533
  • Aug 2, 2010 7:45pm Aug 2, 2010 7:45pm
Good morning, all

Thank you for participating in the small game per se.

Thank you, mojazz, silberfx, bakuli, geoffrey62, swingman, geoffrod, scalpz, havillah, chorlton

I read all the posts. Thank you for compliments and contributions.

The purpose of the game is to show that you do not need to enter the market every single day.

The game is more realistic to what would happen in live trading. Opportunities happen anytime, it could be while we are asleep or just living a life outside the markets. Im letting all traders know that even if you take just the setups that you happen to come across it is still same result at the end. Infact it will be similar result in profits but half the stress/time/drawdown.

I have proved that from 15 entries (and they are also quiet random, just entering with flow), and only randomly choosing 8 positions (cause all traders have a life outside the market and they will open their platform at different time each time) STILL produce profits.

Traders fail cause they try/force/imply to make a profit
Pros know the randomness and only attempt at what they see, when they see

The difference?

Bob the fail trader looks at the same chart of gbp/aud as the game chart. He is live trader, and enters at every trendline break, s/r, bollinger band expansion and so on. Attempting more than 10 times a week and closing out trades @ 1:2 or anything ridiculously small. I dont have hard numbers but I guarantee we would have more profit than him or similar. Unfortunately, for Bob he looks at the chart 10 hours a day cause he is worried not to miss any setup. Health deteriorates, wife leaves him, dog doesnt even acknowledge his call.

John the pro took 8 entries, he knows he has missed few, but he knows the secret to randomness of the outcome. He just took what he came across when he opened his platform. Probably spending less than 30minutes per day at the charts.

Bob the fail - Potential high drawdown, giving alot of money to his brokers in spread, high level of stress. He took 80-100 trades for 'potential' -3000 pips drawdown (considering he uses 30 pip stop loss which is quiet small) for 1500 pips profit at 'x' mark on chart. Good for him! But I feel he is rewarded little for his efforts.

John the pro - 8 entries, potential drawdown is -1600 but we know the 'realized' drawdown was around -800 more or less, still coming out with profit.

John also knows that if he didnt come out with profit at x marks the spot he wouldnt care less cause he knows life/market doesnt end at that x but continues on.

This game chart is so much more than your initial understanding. There are related discoveries to be told.

Sincerely,

Graeme
  • #534
  • Aug 2, 2010 7:49pm Aug 2, 2010 7:49pm
Quoting pip_daddy
Hi Graeme,

Excellent thread. I am so glad I found it. I already have some legs of my millipedes going. By using your system I am learning to not try anticipate the market. To just go with the flow. Seems like a no-brainer but I now realize I was making that simple mistake far too often by using other trading methods. Your system forces me to think that way.

One question if you can find the time to answer. You mentioned you trade about 20 pairs. What pairs do you trade besides the 12 majors? Do you take into consideration some of the characteristics...
Good morning, pip_daddy

Good question.

Pairs of currency is always evolving. eur/usd was thought to have long yearly trend but look at last 2 years and now there are better trends happening in other pair of currency that most traders thought was 'volatile.'

Yes, true some pairs do move much more than anticipated for the year or much less than anticipated for the year.

My answer: I only know after I participate/enter the market with a position. It either grows largely for me or grows small for me. I do not spend time trying to work out which pair is the best trender (cause i dont have the ability to), I try just adding positions and let the market tell me few weeks/months later.

Sincerely,

Graeme
  • #535
  • Edited 8:15pm Aug 2, 2010 8:01pm | Edited 8:15pm
Good morning, all

Lets do another chart together. This is 2nd chart and I welcome all new readers. We learn from contributing and huddling together.

I have purposefully chose the below chart. Its gbp/jpy and many traders run away from it.

I hope all readers consider:

1. Power of randomness from random entries
2. Never over expose
3. Spaced out interpretation
4. Go with flow, up or down

Also, could you try adding in 'ONE' diversification and what reasons did you have when you did it. You do not have to if you prefer not to.

http://img696.imageshack.us/img696/9356/38168020.png

Edit: Please do not judge other traders interpretation, please allow me. There is no right or wrong.

Sincerely,

Graeme
  • #536
  • Aug 2, 2010 9:06pm Aug 2, 2010 9:06pm
Quoting pipEASY
Good morning, all

Lets do another chart together. This is 2nd chart and I welcome all new readers. We learn from contributing and huddling together.

I have purposefully chose the below chart. Its gbp/jpy and many traders run away from it.

I hope all readers consider:

1. Power of randomness from random entries
2. Never over expose
3. Spaced out interpretation
4. Go with flow, up or down

Also, could you try adding in 'ONE' diversification and what reasons did you have when you did it. You do not have to if you prefer not to.

http://img696.imageshack.us/img696/9356/38168020.png...

hi graeme,

this is my chart, please make advise to it
reason i took a diversification because after ranging period, there is suddenly movement of price almost 400 pips, i feel there is something happen in next price




regards,

hari


ps. sorry for my english
Attached Image (click to enlarge)
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  • #537
  • Aug 2, 2010 9:42pm Aug 2, 2010 9:42pm
Hi Graeme,


Here is my take on the second chart.

All short entries are in magenta and all long entries are in green. Two lots entered at each position, +100 assumes 1 lot taken out at 1:1 and second lot taken out at BE. -200 both lots taken out at hard SL of -100. As I see it only entries A, B and C survive to what becomes the bottom of the down trend at 132.300. I know that price retraces to entry point A but I would have held this position based on the fact that I recognized the up wave as an Elliott wave 4th wave. So in this case I cheated a bit I just know I wouldn't have pulled the plug on that position.

Once price hits the low at 132.300 and starts to come up from that point we don't know if it is just a retrace or if it's a reversal. To me the first clue that price may go higher is we get a consolidation range followed by a higher high and a higher low. To me here is the area that will either make or break the profit potential of this series of trades. We could start to diversity by taking profit on positions B and C. Depending on where you got out the profit potential for position "B" is 100-600 pips and position "C" is BE - 500 pips. Now the only position that is surviving is position "A". At the bottom of the down trend the position value was at about +1000 pips if you held on through the 600 pip up swing you would be at about +400 pips.

All in all you would be looking at a total pipage of +1000 to +2000 pips depending on you exits.
Attached Image (click to enlarge)
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  • #538
  • Aug 2, 2010 9:55pm Aug 2, 2010 9:55pm
Hi Graeme,

here is my take on the 2nd chart.

Thanks.

Attached Image (click to enlarge)
Click to Enlarge Name: gj.gif Size: 30 KB
  • #539
  • Aug 2, 2010 10:05pm Aug 2, 2010 10:05pm
Hi Graeme

This is conservative approach using nothing but the 4 hour time frame for EP. You will note I have a thing for ema's still, I like to play power pivot and pinbar EP's off ema's. I realise that they are lagging indicators but I feel they hold some worth.

In reality I would be looking for better EP's on the hourly.

http://www.xboxmod.co.uk/images/gbpjpy.gif


Cheers
Mark
  • #540
  • Edited 10:46pm Aug 2, 2010 10:32pm | Edited 10:46pm
Here are my reasons for entering trades:

1. Price bounced off Support and broke thru mini-resistance - Go LONG
2. Large Range bar from Resistance - Go SHORT
3. Large Range bar - Break down from Support - Go SHORT
4. Large Range bar - Break down from Support - Go SHORT
5. Price in Mini-Range (suggests change of trend) followed by Breakout
from Resistance - Go LONG
6. Narrow Range - Breakout from Resistance - Go LONG
7. *Risky Trade* Downbar with long downward wick hitting uptrend support
followed by upbar - Go LONG
8. Breakdown thru support (triangle pattern) Go SHORT
9. (blue arrow) Mini Range followed my large range down bar - Go SHORT
9. (yellow arrow) Downbar with long downward wick followed by upbar - Go
LONG
10. Large downbar thru support - confirms downward trend continuation -
Go SHORT
11 Breakout from range thru Resistance - Go LONG
12. Breakout from mini-range thru Resistance - Go LONG
13. Breakout from downward trend - Go LONG
Apologies if its a bit rushed but i'm at work

PS. Regarding Diversification, I would probably look to exit some of my winning trades @ entry # 11. My reasoning is that we have just been in a range for a while with a breakout to the upside which suggests to me that we could be seeing a change in main trend (from down to up). Not sure on this though, so would welcome advice from Graeme / others.....

Cheers....
Attached Image (click to enlarge)
Click to Enlarge Name: Exercise 2.jpg Size: 91 KB
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