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Dreamliners’ MPAS (Mechanical Price Action Strategy) System

  • #81
  • Dec 25, 2010 7:25am Dec 25, 2010 7:25am
Yes, not every range bar is a trade bar. Of course the price will not retrace sometimes.

Quoting smilee89
Right.
The same for the other side.
Price dropped down and did not retrace back to Open price.
As long as you did not enter a loosing trade (not to mention entered wrongly) - it's ok.

Not every range bar is a trade bar.
This bar is not a trade bar.
  • #82
  • Dec 25, 2010 7:36am Dec 25, 2010 7:36am
Zamanib, this is exactly what drew me to this method. You're seeing it right, and look at all the profit to be had.

But here is the only problem I see: take a look at the last bar you have drawn a W on, the up bar. It is possible that that bar went up 20 pips from the open, triggering us to place a Sell Stop order at the open, then went down 40 pips, then went back up 50 to close. This would have been a loss.

That seems very unlikely that a prices will oscillate that much. What seems much more likely is that it dropped down 20 from open, triggering our Buy Stop order, then moved up 50 to give us our profit.

But since we've removed the time element we don't know which order that bar moved. Did it move up first, then down, and back up? Or did it move down and then up?

This is where some kind of an official back tester would come in handy.

Quoting zamanib
I just did a few days in in decemeber 1st--3rd

not all bars are tradeable -

this is the condition i work with from open price -- price must move above or below minimum 20 pips and not exceed 35 pips

the blue arrow with (blue w) met the above conditoin-
the blue arrow with (yellow w) fall short a 1 -3 ppips to met the minimum 20 pips below or above open price.

If this what i am seeing we have a great thing going here
  • #83
  • Dec 25, 2010 7:39am Dec 25, 2010 7:39am
Yes, I was thinking of this very thing last night. We will of course set both a minimum and a maximum the bar can drop before we will allow our order to be triggered. Thank you for your comments.

Quoting zznbrm
- I use a custom-built simulator that deals with range bars just fine. I'll run some tests when I get a chance.

- If you set the TP to be the close of the current bar, the absolute best you can do is a 2:1 RR ratio (before spread). This would be a perfect trade where the price moved exactly 10 pips in one direction from the bar open, then immediately moved back in the opposite direction to the bar open to trigger your trade, and then continued in the same direction until bar end. That is 20 pips before spread. Your true RR ratio (after spread)...
  • #84
  • Dec 25, 2010 7:42am Dec 25, 2010 7:42am
I was actually thinking 20 pips on a 50 range bar with a take profit at 30 or the close of the bar. This would give us a better hit rate.

Quoting sidhujag
Hi Zamanib,

with a 50 pip bar you would set an alert for 16.6 pips since that is 1/3 of the bar. Your SL would be 16.6 pips and TP would be double. Try that.

Jag
  • #85
  • Dec 25, 2010 7:44am Dec 25, 2010 7:44am
This is exactly right, Zamanib, this is why I said that live trading will reveal the weak spots in this system. However, if we stick to 50 pip range bars with a 20 pip trigger and stop loss and a 30 pip target, it will greatly minimize the oscillations which would take our profit.

Quoting zamanib
i will do 20 for now easy on the eyes and brians to compute (lol) also when we have simulator we can change range size tp size buy sell trigger value

ok be we still need to look at 5mins regular chart on the back test then our result will be accurate--

i did one example to show the 1st bar on december 1st...
  • #86
  • Dec 25, 2010 7:47am Dec 25, 2010 7:47am
I will be tracking 15-17, 18-19, 20-22, 23-25, and 26-30 individually. This is easy to do with Trading Journal Spreadsheets. Of course each one of those entries will give us different R:R.

Quoting sidhujag
Hi Zamanib,

with a 50 pip bar you would set an alert for 16.6 pips since that is 1/3 of the bar. Your SL would be 16.6 pips and TP would be double. Try that.

Jag
  • #87
  • Dec 25, 2010 8:16am Dec 25, 2010 8:16am
For back testing -- there is difinetly we need to look at the 5min regular chart-- from my previous chart with blue arrow and w -- for far 2 of them went yoyo -- and take out the sl ( my sl will be the distance from 20 from open-- or we could do the high or low of the bar
PROFITABLE TRADERS ARE NOT LUCKY BUT ARE WELL PREPARED
  • #88
  • Dec 25, 2010 8:51am Dec 25, 2010 8:51am
Hello, I am a new member to FF but have been reading the threads for a long time. I have been trading forex for a few years now and find this thread very intereting.

I use range bars on MT4, therefore may I make a suggestion concerning the back testing.

I would suggest using a 5 range bar for your backtest rather than time. The 5 min bar covers too much range where the 5 range bar would give a more accurate read.

Just my $.02 worth
  • #89
  • Dec 25, 2010 9:12am Dec 25, 2010 9:12am
Quoting Dreamliner

But here is the only problem I see: take a look at the last bar you have drawn a W on, the up bar. It is possible that that bar went up 20 pips from the open, triggering us to place a Sell Stop order at the open, then went down 40 pips, then went back up 50 to close. This would have been a loss.
I don't understand why it would have been a loss.

Once the bar went up 20 pips from the open, triggering us to place a Sell Stop order at the open, then went down 40 pips - You win the Short trade.

Now. There are 2 options:
1. When Sell stop hit - Buy stop order will not be taken.
2. Buy stop order will be taken, so if later-on the price went back up 50 - you win again. This time, the Buy trade.
  • #90
  • Dec 25, 2010 11:20am Dec 25, 2010 11:20am
Quoting sundance
Hello, I am a new member to FF but have been reading the threads for a long time. I have been trading forex for a few years now and find this thread very intereting.

I use range bars on MT4, therefore may I make a suggestion concerning the back testing.

I would suggest using a 5 range bar for your backtest rather than time. The 5 min bar covers too much range where the 5 range bar would give a more accurate read.

Just my $.02 worth
you miss the point man--- WE ARE TRYING TO SEE THE PRICE MOVEMENTS-- range bar you can not see price movement for back testing
PROFITABLE TRADERS ARE NOT LUCKY BUT ARE WELL PREPARED
  • #91
  • Dec 25, 2010 12:18pm Dec 25, 2010 12:18pm
Quoting zamanib
you miss the point man--- WE ARE TRYING TO SEE THE PRICE MOVEMENTS-- range bar you can not see price movement for back testing

It gets a bit confusing because with 30 pip range bars, price can do all sorts of things to go in and out of profit or to stop loss.

I don't have a solution, but it would be great if we could have some smart MT4 coder create an indicator that would show the movement within a 30 pip range bar.

The attached image shows 5 pip range bars moving within a 60 minute candle

If we could have 5 pip range bars moving with 30 pip range bars that might give a better visual.
Attached Image (click to enlarge)
Click to Enlarge Name: m-candles.png Size: 5 KB
Attached File(s)
File Type: mq4 M-Candles.mq4   6 KB | 404 downloads
File Type: ex4 M-Candles.ex4   9 KB | 324 downloads
  • #92
  • Dec 25, 2010 12:41pm Dec 25, 2010 12:41pm
I don't have a solution, but it would be great if we could have some smart MT4 coder create an indicator that would show the movement within a 30 pip range bar.

this is main point --to see price movement with in a 30 pips rangebar or 50 pips rangebar-- this is only for back testing-- do that you need to look at 5min chart-- please dont get carried away my time -- it is not time we are looking at it is price movement--within the rangebars and this is only for backtesting
PROFITABLE TRADERS ARE NOT LUCKY BUT ARE WELL PREPARED
  • #93
  • Dec 25, 2010 12:45pm Dec 25, 2010 12:45pm
Exactly right! This is the only way we will be able to tell if this system has a positive expectancy. Well that, and live trading.

Quoting zamanib
I don't have a solution, but it would be great if we could have some smart MT4 coder create an indicator that would show the movement within a 30 pip range bar.

this is main point --to see price movement with in a 30 pips rangebar or 50 pips rangebar-- this is only for back testing-- do that you need to look at 5min chart-- please dont get carried away my time -- it is not time we are looking at it is price movement--within the rangebars and this is only for backtesting
  • #94
  • Dec 25, 2010 12:45pm Dec 25, 2010 12:45pm
pgpb,

Thank you, my point exactly, if you look at a 5 min chart then compare any given bar to the 5 range bars for the same time you will be able to better determine the movement w/in the time bar!

The 5 range bar would be a better method of seeing a more accurate movement w/in the 30, 50 or whatever range you are attempting to do a manual back test.
  • #95
  • Dec 25, 2010 1:00pm Dec 25, 2010 1:00pm
although im not experienced yet with mt4 range bars the concept of trading range is well understood by me

for example the indicater bsed on the 3bar breakout the hh and ll of the prevoius 3 bars not including the current formed bar is well understood

as an accurate tool for defining the current range ( the square) this use of the trading range and trading bars within a sideways market is well understood for swing high swing low by most experienced traders

so the fractal breakout of the range ( eg 2 pis either 2 the long or short )
is used as the trigger start of the new range in trading

ok nothing new but adding clarity to the use of range bars the trading range and timming entrys and exist

so the win loss of trading within a range and breakout of ranges eg range bars the square is based on fractals

so dreamliner is using a method as i can see as fractals eg plus 20 or 5 as fractal entry depending on size of the trading range or trading bar

excellent method in a side way market or in the time frame large when hugh movements occure causing expansion and contraction of the range bars

or in a side ways trending market

but one needs in my opinion to define the time you wish to trade and the

method of using the RANGE bars to help in the percentage hit rate

otherwise one can be like a cat chasings its tail finding the ideal pips above or below the range for finding perfect entrys or the fractals within the range

back testing in demo is a waste of time.

for demo traders its a nice game only

testing under the 4hour range is realy crazy due to market volatility

after years of involving myself in back and forwood testing and neutral networks ang generic anologue testing shows one how stupid this back testing is for forwood projections in real time trading


but of couse demo traders have a different opinion

now it seems to me this range trading using potential percentage win loss ratios as dreamliner is doing is a sound idea

much the same as one uses pips to the top of the range the range to pips to the bottom for risk reward calculations

for me the introduction of range bars to mt4 has opened my eyes to
another great tool

so i just added a few additional thoughts of mine to this potential great thread as im sure with positive support to dream liner it will produce great results in the future


i hope the above may help in understanding to the new commers some basic principle of using the trading range

which the range bars if properly ajusted can be a very valuable tool

thank you dream liner for your thread great work

from BRIAN
  • #96
  • Dec 25, 2010 1:35pm Dec 25, 2010 1:35pm
Thank you very much for your input here Brian. I agree with you about backtesting; the only value it would provide in this case is to see exactly what happened during any specific 50 pip range bar. It LOOKS like it went up 20 pips and then down 30, but is that REALLY what happened? Or did it go down 20 first, then up 40, then back down 30. I'd just like to be able to examine any 50 pip range bar and see what happened and compare that with how it looks.

Quoting brijon
although im not experienced yet with mt4 range bars...
  • #97
  • Dec 25, 2010 1:37pm Dec 25, 2010 1:37pm
Great Thread
  • #98
  • Dec 25, 2010 2:15pm Dec 25, 2010 2:15pm
this what we are trying to achive--

I manually look at most of the trades on the rangebar chart -- then look at the 5min to see the price movement-- the success rate is high-

but it is time consuming to do -- no one making an effort to do it manually--

I can commit to do 1st 10 days in December anyone else can take the rest of the month and other do November October
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 9.gif Size: 12 KB
Click to Enlarge Name: 9-2.gif Size: 12 KB
PROFITABLE TRADERS ARE NOT LUCKY BUT ARE WELL PREPARED
  • #99
  • Dec 25, 2010 2:24pm Dec 25, 2010 2:24pm
I would be happy to help, I just don't know how to do it. For instance, when the range bar's time says "1224" I believe that is the time when the bar ended, correct? So do you just take the time from one end of bar to the time of the next end bar and see what happened in between?

Quoting zamanib
this what we are trying to achive--

I manually look at most of the trades on the rangebar chart -- then look at the 5min to see the price movement-- the success rate is high-

but it is time consuming to do -- no one making an effort to do it manually--

I can commit to do 1st 10 days in December anyone else can take the rest of the month and other do November October
  • #100
  • Dec 25, 2010 2:34pm Dec 25, 2010 2:34pm
Quoting Dreamliner
I would be happy to help, I just don't know how to do it. For instance, when the range bar's time says "1224" I believe that is the time when the bar ended, correct? So do you just take the time from one end of bar to the time of the next end bar and see what happened in between?
take the time current bar (open time) then time of the next bar opening (the bar to the right) time will be off sometime 2 - to 4 mins no problem

I did december 22 take a look
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 9.gif Size: 10 KB
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PROFITABLE TRADERS ARE NOT LUCKY BUT ARE WELL PREPARED
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