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The Small Hours Simplified!

  • #121
  • Feb 13, 2011 8:30pm Feb 13, 2011 8:30pm
The system has been tested all the way down to 1H candles. I don't recommend going any lower due to volatility reasons!

As to the 40 SMS and 20 SMA - not exactly sure. I know the system works the way it is.

Why fix it if it isn't broke?

Quoting Indrek
A very interesting system, indeed! And I like the traffic lights indicator very much
Still, wanted to ask two important questions:
1. Does anyone have evidence that this system does not work on other timeframes, too?
2. Why is it important to use two SMAs? Why not using just SMA40 if we want to be more conservative and only SMA20 if we have aggressive intentions?
  • #122
  • Feb 13, 2011 8:31pm Feb 13, 2011 8:31pm
I am trying to add lines for the HH and LL. I think I have everything done except I cannot get the parameters right. Can someone help with this?
Attached File(s)
File Type: mq4 Small Hours v2 with lines.mq4   9 KB | 353 downloads
  • #123
  • Feb 13, 2011 8:34pm Feb 13, 2011 8:34pm
Quoting ido370
corner: upperleft=0, upperright=1, lowerleft=2, lowerright=3
y: distance from the top of the screen, the higher the value, the lower its on your chart.
showlevels: true - show levels, false - don't show levels
alert: true - alert message on signal, false - no alert message on signal
mail: true - send email on signal, false - no email on signal

You can doubleclick the values to change them when you add the indictor to your chart.

Please update to Small Hours V2 first (new updated version), you can find...
Hi Ido

Thanks for the nice indicator. Could you modify the code to give the values of ATR and HH5-LL5 in one decimal point. I think it is more accurate rather than by rounding up the values.

One more thanks
  • #124
  • Feb 13, 2011 8:45pm Feb 13, 2011 8:45pm
those are indeed the majors I trade not the EURJPY though...too volatile! I've gotten signals on each pair, however not all have triggered. The most common pairs for triggering (so far) are the EURUSD, AUDUSD & USDJPY

Majors traded:
EURUSD
GBPUSD
USDJPY
USDCHF
USDCAD
AUDUSD

Quoting raesal
thanks colostarr for sharing your knowledge. i would just like to ask what are the six pairs you are trading? is it the EU, GU, EJ, UJ, AU, and UCAD? and on average do you usually get 1 trade per day on these six pairs? for example for this day we only have EU. the next day only GU? thanks
  • #125
  • Feb 13, 2011 9:07pm Feb 13, 2011 9:07pm
Quoting ido370
just one more tool then:
removed EA code, so this is Indicator only!
When first light is orange, and other 2 are green, signal to buy. when light is orange and other 2 are red, signal to sell.
According to the rules ofcourse
You can switch options on/off in the indicator to show TP/SL/Entry levels, Alert message, Email alert, change corner position, change height placement value.

Note: first light turns orange, since its OK signal for sell AND buy!

Attachment
screenshot with all options on false(default):
Attachment
screenshot...
Hi Colostarr & Ido,

Up trend set up:
2. The high of the most recently closed candle must be less than HH5

Down trend set up:
2.The low of the current closed bar must be greater than LL5

(A) Referring to the attached chart, the high of the most recently closed candle is less than HH5 (0.97749). So this is an up trend set up.

(B) Referring also to the attached chart, the low of the most recently closed candle is greater than LL5 (0.96831). So this is a down trend set up as displayed by the 2nd red light indicator - selling signal (coded by Ido)

Which one of the set up is correct?
Attached Image (click to enlarge)
Click to Enlarge Name: eurchf.gif Size: 20 KB
  • #126
  • Feb 13, 2011 9:09pm Feb 13, 2011 9:09pm
Hi Colostarr & Ido

Set up (A) or (B)?
  • #127
  • Feb 13, 2011 9:31pm Feb 13, 2011 9:31pm
I was just looking at this very pair.

Right now neither is a valid setup as the pips moved exceeds your ATR x 1.5.

If the market slows down here and moves sideways for one more candle and volatility remains low, this will be a valid buy entry.

It is not a sell entry because the most recently closed candle closed above the 20 and the 40 SMA....

Rule #3 downtrend: The close of the most recently closed candle must be less than the 20SMA or 40 SMA (can be both)
"clearly you can see that it does not!"

WARNING: JUST BECAUSE AN INDICATOR GIVES YOU A SIGNAL, YOU MUST FIRST VALIDATE ALL 3 RULES BEFORE PLACING YOUR STOPS! FAILURE TO DO SO COULD LEAD TO LOSS.

Validate the rules...then place your stop or limit orders!

Quoting mnoh
Hi Colostarr & Ido,

Up trend set up:
2. The high of the most recently closed candle must be less than HH5

Down trend set up:
2.The low of the current closed bar must be greater than LL5

(A) Referring to the attached chart, the high of the most recently closed candle is less than HH5 (0.97749). So this is an up trend set up.

(B) Referring also to the attached chart, the low of the most recently closed candle is greater...
  • #128
  • Feb 13, 2011 9:53pm Feb 13, 2011 9:53pm
Upon further review of this pair, it would have to move sideways for 2 more candles before it is a valid setup!!
  • #129
  • Feb 13, 2011 10:02pm Feb 13, 2011 10:02pm
Colostarr, thanks a lot.

I hope Ido will modify the 2nd signal of the indicator by looking at the 3rd rule first i.e whether the closed candle is above or below 20 SMA or 40 SMA. This is just a suggestion if we replace the 3rd rule to be the 2nd rule and the 2nd rule to be the 3rd rule.
  • #130
  • Feb 13, 2011 10:08pm Feb 13, 2011 10:08pm
The sequence of the rules is now look like this....

1. The HH5-LL5 must be less than the ATRx1.5 as of the most recently closed candle
2. The close of the most recently closed candle must be greater than the 20SMA or 40SMA
3. The high of the most recently closed candle must be less than HH5

The old one is like this....

1. The HH5-LL5 must be less than the ATRx1.5 as of the most recently closed candle
2. The high of the most recently closed candle must be less than HH5
3. The close of the most recently closed candle must be greater than the 20SMA or 40SMA
  • #131
  • Edited 10:47pm Feb 13, 2011 10:13pm | Edited 10:47pm
Wow the market came out swinging this morning huh? Here's a little action for those of you waiting to trade. One of my other methods gave me the following signals this morning!:

Signals valid until 1200 GMT 14 Feb

GBPUSD Sell Stop: 1.5967
Stop loss: 1.6056
TP1: 1.5929 TP2:1.5891

AUDUSD Sell stop: .9973
Stop Loss: 1.00430
TP1: .9943 TP2:.9914

USDJPY Buy Stop: 83.66
Stop Loss: 83.17
TP1: 83.86 TP2: 84.05

Price has moved away from all 3 of these signals, but that is ok. Happens all the time!

Remember....let price come to you!
  • #132
  • Feb 13, 2011 10:22pm Feb 13, 2011 10:22pm
i like to refer to yesterdays close price as to todays trend first as a breakout would have to move in my opion above or below this point for me to be absolute confirmation but i may be wrong
i will keep looking

also just a brief obsevation on usdchf the usd rs is still low against the chf only my observation

so i agree let the price come to you

from BRIAN
  • #133
  • Feb 13, 2011 10:24pm Feb 13, 2011 10:24pm
Apologies, I intended to do this last night...got too tired! I tried to reverbalize the rules on page 1, and I shouldn't have, due to how tired I was. here ya go happy trading:

Down trend:

1. The HH5 minus the LL5 must be less than the ATR value x 1.5 as of the most recently closed candle

2. The low of the most recently closed candle is greater (higher) than the LL5

3. The close of the most recently closed candle is less than the 20SMA or the 40SMA (can be both)

Up trend:

1. The HH5 minus the LL5 must be less than the ATR value x 1.5 as of the most recently closed candle

2. The high of the most recently closed candle must be less than the HH5

3. The close of the most recently closed candle must be greater than the 20 SMA or the 40SMA (can be both)
  • #134
  • Feb 13, 2011 10:48pm Feb 13, 2011 10:48pm
Let's assume we have a long trigger and we place our buy stops and SL's. If the current open candle moves down and away from our intended direction and further then the current ATR x 1.5, do we cancel all pending orders and wait for a new setup? Or do we wait to see if price comes back and takes out our buy stops? In other words, do we ignore current candle price action and only be concerned about the past 5 bars?

thx,
todd
  • #135
  • Feb 14, 2011 12:01am Feb 14, 2011 12:01am
Don't rely on an indicator for these values:

Open the data window in MT4, mouse over the most recently closed candle and it will TELL you what the ATR value is

Example: Data window gives ATR value of .0036 as of most recently closed candle. Remove decimals and multiply like this:

ATR = .0036 (36x 1.5 = 54) 54 pips is the basis of rule #1!

Quoting mnoh
Hi Ido

Thanks for the nice indicator. Could you modify the code to give the values of ATR and HH5-LL5 in one decimal point. I think it is more accurate rather than by rounding up the values.

One more thanks
  • #136
  • Feb 14, 2011 12:02am Feb 14, 2011 12:02am
I think that should be ok, as long as all of the rules are met to place the trade!!

Quoting mnoh
Colostarr, thanks a lot.

I hope Ido will modify the 2nd signal of the indicator by looking at the 3rd rule first i.e whether the closed candle is above or below 20 SMA or 40 SMA. This is just a suggestion if we replace the 3rd rule to be the 2nd rule and the 2nd rule to be the 3rd rule.
  • #137
  • Feb 14, 2011 12:07am Feb 14, 2011 12:07am
Chances are if price moves away from your limit or stop orders, then rule #1 is no longer valid (for future candles). So you would wait. Your signal bar or candle is valid for the next 3 candles (regardless of their size).

Hence you wait for price to come back to you!

I have seen this numerous times. It simply means price met with resistance or support. If price moves to one of your SMA's it will probably bounce back to you!

This is the best case scenerio in my opinion! Because if price comes back to test that support or resistance, chances are it will firmly break it when tested again. This is GOOD for you!

Hope this answers your question!

Quoting todd960960
Let's assume we have a long trigger and we place our buy stops and SL's. If the current open candle moves down and away from our intended direction and further then the current ATR x 1.5, do we cancel all pending orders and wait for a new setup? Or do we wait to see if price comes back and takes out our buy stops? In other words, do we ignore current candle price action and only be concerned about the past 5 bars?

thx,
todd
  • #138
  • Feb 14, 2011 12:53am Feb 14, 2011 12:53am
OK, So here is the indicator. I think is really helpful to eyeball the history with it.
http://i54.tinypic.com/nytmci.png
Attached File(s)
File Type: ex4 atr1.5 hh5-ll5.ex4   10 KB | 413 downloads
  • #139
  • Feb 14, 2011 1:06am Feb 14, 2011 1:06am
Hi Ido370,

1. Your indicator gives ATR value not for the closed current candle (pointed by an arrow). The value is for the unclosed current candle. Look at the attachment.

2. The HH5 - LL5 value is correct which give the value from last 5 candles counting backward from the closed current candle (pointed by an arrow).

Need comment from Colostarr.

Thanks
Attached Image (click to enlarge)
Click to Enlarge Name: eurchf.gif Size: 20 KB
  • #140
  • Feb 14, 2011 1:08am Feb 14, 2011 1:08am
Very interesting system. How many signals do you get a day/week on a pair. I ask this because i have only found one on USDJPY and it was profitable but it is extremely difficult to find ATR x 1.5 value higher than HH5 minus LL5 and that is the key to trading this system, i guess.
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