mechanical divergence | Page 2 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Divergence and hidden Divergence 122 replies

Mechanical Systems 1 reply

About Mechanical/Automated Trading 17 replies

Does Mechanical Trading Bring Peace of Mind? 54 replies

Mechanical Trading vs Manual Trading 27 replies

Attachments: mechanical divergence
Exit Attachments

mechanical divergence

  • #21
  • Jul 18, 2011 2:43pm Jul 18, 2011 2:43pm
Quoting blutkehlchen
Hey Paulus , i did a quick visual check of the Divergence Indicator on CR Bars, and its far to good , normaly i would fire up the Tradesimulator and see if its repainting , but thats not possible right now , so iam asking you if you saw this FX5_Divergence Indicator repainting AFTER bar close ?

Thanks
If I am not mistaken this is the calculation of divergence in the indicator:

void CalculateOsMA(int i)
{
OsMA[i] = iOsMA(NULL, 0, fastEMA, slowEMA, signal, PRICE_CLOSE, i);
//----
if(OsMA[i] > 0)
{
upOsMA[i] = OsMA[i];
downOsMA[i] = 0;
}
else
if(OsMA[i] < 0)
{
downOsMA[i] = OsMA[i];
upOsMA[i] = 0;
}
else
{
upOsMA[i] = 0;
downOsMA[i] = 0;

So if I am correct calculation is based on up-down( or high-low).Anything that is calculated on high-low is fuzzy.There must be a differet way of calculating the divergence but what?
  • #22
  • Jul 18, 2011 3:34pm Jul 18, 2011 3:34pm
Hi Purley

the code below is not the code to check for divergence, that is the code to color the up & down bars differently

The controlling routine that calculates the divergence is called "CalculateDivergence", this looks for the peaks & troughs and determines if there is regular divergence.

Regards, John

Quoting purley
If I am not mistaken this is the calculation of divergence in the indicator:

void CalculateOsMA(int i)
{
OsMA[i] = iOsMA(NULL, 0, fastEMA, slowEMA, signal, PRICE_CLOSE, i);
//----
if(OsMA[i] > 0)
{
upOsMA[i] = OsMA[i];
downOsMA[i] = 0;
}
else
if(OsMA[i] < 0)
{
downOsMA[i] = OsMA[i];
upOsMA[i] = 0;
}
else
{
upOsMA[i] = 0;
downOsMA[i] = 0;

So if I am correct calculation is based on up-down( or high-low).Anything that is calculated on high-low is fuzzy.There must be a differet way of calculating the divergence but what?
  • #23
  • Jul 18, 2011 4:41pm Jul 18, 2011 4:41pm
Quoting Paulus
Monday

After viewing the Frankfurt open I decided to put a longer time frame OsMa on the chart this is for direction

The parameters on the 1min Osma are 12,26,9

Therefore to see the 5min trend I took those figures and multyplied by 5 to give 5min = 60,312,54

If long term OsMa green take long diversity signals according to rules on page 15

If long term OsMa red take short diversity signals according to rules on page 15

Return on account for Monday = + 34%

So... the stochastics indy you provided on page 1 is no longer used in your current setup... am I correct?
  • #24
  • Jul 18, 2011 10:30pm Jul 18, 2011 10:30pm
hi paulus,

thanks for resurrecting your thread and sharing your strategy with us.

I have 2 questions about your trading.

- although you mentioned later that you added a long term OSMA (nearly m5) to filter out trades, are there any other filters that you use apart from TMA true and higher TF OSMA? because in your examples, I found more divergences than the ones you trade and some of them would be losers. how do you filter them out?

- where do you put your stop loss when the price makes HH or LL as it would be higher/lower than the latest swing's high/low? how do you determine the 5% risk then?

thanks for your replies in advance...

green pips to all...
  • #25
  • Jul 18, 2011 10:33pm Jul 18, 2011 10:33pm
Quoting prof8t
So... the stochastics indy you provided on page 1 is no longer used in your current setup... am I correct?
correct I will amend that post later today

cheers

P
  • #26
  • Jul 18, 2011 10:35pm Jul 18, 2011 10:35pm
Quoting isengoz
hi paulus,

thanks for resurrecting your thread and sharing your strategy with us.

I have 2 questions about your trading.

- although you mentioned later that you added a long term OSMA (nearly m5) to filter out trades, are there any other filters that you use apart from TMA true and higher TF OSMA? because in your examples, I found more divergences than the ones you trade and some of them would be losers. how do you filter them out?

- where do you put your stop loss when the price makes HH or LL as it would be higher/lower than the latest...
Hi please post your charts and let me look please and mark the trades which you feel qualify...

Again can you give me a chart example .. I place the SL above the last hi behind my signal for a short

cheers

P
  • #27
  • Edited Jul 19, 2011 12:02am Jul 18, 2011 11:38pm | Edited Jul 19, 2011 12:02am
well, I realized that higher TF definitely eliminates some trades. First one is from your last chart, and also an example of my question about SL, and the second one is from post #15.

edit: I think I got what you meant by the last swing low/high. You enter into trade when price retraces a bit and place the SL a few pips upper/lower. I just thought of entering at the extreme point of the swing where you draw divergence lines. my fool... sorry.
Attached Image(s) (click to enlarge)
Click to Enlarge Name: d7.gif Size: 45 KB
Click to Enlarge Name: d1.gif Size: 35 KB
  • #28
  • Jul 19, 2011 11:08am Jul 19, 2011 11:08am
yes correct the top chart example that would of been a signal for -5% see chart for stop placement
Attached Image (click to enlarge)
Click to Enlarge Name: d8.gif Size: 29 KB
  • #29
  • Jul 19, 2011 11:16am Jul 19, 2011 11:16am
nice signals again today any I missed please let me know,but dont forget .00001 does mean a lower low an EA would identify this

Return on account Tuesday - + 22%

P
Attached Image (click to enlarge)
Click to Enlarge Name: d9.gif Size: 32 KB
  • #30
  • Jul 19, 2011 12:00pm Jul 19, 2011 12:00pm
Quoting Paulus
nice signals again today any I missed please let me know,but dont forget .00001 does mean a lower low an EA would identify this

Return on account Tuesday - + 22%

P
paulus,

you are doing well, congratulations. Hope I will catch you in a short time in terms of success rate. However, my first day with your strategy unfortunately ended up in negative. you can see my trades in the chart. I'd be pleased to hear your comments.

by the way, I think your % calculation is better than counting pips. but, how do you calculate the risk you will take, I mean the lot size, in such a short time as each trade has different stops.

and can you tell me your TMA settings. as far as I see yours is a little bit different from mine.

thanks and good luck...
Attached Image (click to enlarge)
Click to Enlarge Name: d9.gif Size: 50 KB
  • #31
  • Jul 19, 2011 1:11pm Jul 19, 2011 1:11pm
you have sharp eyes ! thanks god



have marked up comments on your chart and posted mine with the 1st trade included giving 15% so ROC goes up to + 37 %

TMA bands are set to 0-56-4-100-10000

hope that helps

P
Attached Image(s) (click to enlarge)
Click to Enlarge Name: d11.gif Size: 52 KB
Click to Enlarge Name: d12.gif Size: 33 KB
  • #32
  • Jul 19, 2011 4:13pm Jul 19, 2011 4:13pm
Hi Paulus,

Just curious.
At the beginning you used divergence indicator(FX5). It would prevent overlooking set up, M1 can be pretty fast TF.
On other hand, I tried it yesterday, it was giving me too many signals.
So, do you plan on adding something like that?
Thanks in advance for your reply
  • #33
  • Jul 19, 2011 11:31pm Jul 19, 2011 11:31pm
Quoting morris1
Hi Paulus,

Just curious.
At the beginning you used divergence indicator(FX5). It would prevent overlooking set up, M1 can be pretty fast TF.
On other hand, I tried it yesterday, it was giving me too many signals.
So, do you plan on adding something like that?
Thanks in advance for your reply

Yes the plan is to define the divergence 1st with trend direction most divergence is counter trend

Once this has been done the original FX indicator can be altered and then tested by an EA programmer I hope

We can then use an EA to calculate the 5% risk or set to what you require and this will fire the orders..The EA sould beable to calculate % risk SL and TP if we make this calculation 5 sec from the end of the entry bar

Ideally we need variables within the EA of

% risk
Market hours
ATR of TMA bands
Audible alert
manual contract size selection

Theres a way to go this visual proving and hunting down signals is the 1st step

P
  • #34
  • Jul 19, 2011 11:36pm Jul 19, 2011 11:36pm
Hey all,
you may want to have a look here: http://www.forexfactory.com/showthread.php?t=280437

Hanover has coded a Visual Order script for MT4. It allows you to visually place your order, TP and SL & you can do so dependent on % risk ( i.e. your 5 % ). I use it all the time. It then calculates lot size dependent on your Stop etc.

It was going to be commercial......he then made it freeware, but just noticed he's removed it from circulation ( but invites you to PM him ).

There's also another free version elsewhere on FF ( it's referred to in the thread I just provided ).
- Look to the left, Trade to the right - I am the system
  • #35
  • Jul 19, 2011 11:40pm Jul 19, 2011 11:40pm
Quoting Sebastiaan76
Hey all,
you may want to have a look here: http://www.forexfactory.com/showthread.php?t=280437

Hanover has coded a Visual Order script for MT4. It allows you to visually place your order, TP and SL & you can do so dependent on % risk ( i.e. your 5 % ). I use it all the time. It then calculates lot size dependent on your Stop etc.

It was going to be commercial......he then made it freeware, but just noticed he's removed it from circulation ( but invites you to PM him ).

There's also another free version elsewhere on FF ( it's referred...

Hey Seb

Thanks for this ..this is whats its all about we give and receive if we dont help one another we wont help ourselves

Will pm him and let you know what happens

P
  • #36
  • Jul 20, 2011 10:07am Jul 20, 2011 10:07am
Some nice signals again please inspect and compare

5 signals giving an ROC of + 34%

P
Attached Image (click to enlarge)
Click to Enlarge Name: d13.gif Size: 35 KB
  • #37
  • Jul 20, 2011 11:03am Jul 20, 2011 11:03am
Here are my trades from today.
I would appreciate if You could comment on the 2 trades with the ???????...

I know that both signal candles closed slightly above the middle line,but in the last 2 days You have counted these as well.

The last winning short I missed because of the datafeed.My osma didnt change to green for 1 bar so I had no signal.

The last losing trade was after london close...right???
Attached Image (click to enlarge)
Click to Enlarge Name: 2007.jpg Size: 113 KB
  • #38
  • Jul 20, 2011 12:23pm Jul 20, 2011 12:23pm
Quoting thecambist
Here are my trades from today.
I would appreciate if You could comment on the 2 trades with the ???????...

I know that both signal candles closed slightly above the middle line,but in the last 2 days You have counted these as well.

The last winning short I missed because of the datafeed.My osma didnt change to green for 1 bar so I had no signal.

The last losing trade was after london close...right???
The 2 ????? look like good signals to me -5% and around +10% the losing signal on your chart to give you an idea the actual bar which your trend line hits on my charts is 12.04pm UK time ....we still had another 5 hours to go to London close

hope that helps

P
  • #39
  • Jul 20, 2011 12:38pm Jul 20, 2011 12:38pm
Quoting Paulus
Some nice signals again please inspect and compare

5 signals giving an ROC of + 34%

P
paulus,

I don't know whether you trade with this system for real or not, but are you aware that you could almost double your account in 3-4 days!?! that's just awesome. I didn't trade today, but if I did I would take 2 more trades both of which would be loosers. I showed them in your chart below. even then the profit would be +24% in your terms. that's still too good for me to believe...

good luck for tomorrow...
Attached Image (click to enlarge)
Click to Enlarge Name: d13.gif Size: 41 KB
  • #40
  • Jul 20, 2011 3:03pm Jul 20, 2011 3:03pm
Im live on another system and have used funds to trade this hence my micro mini main contract statement

being 1min making the calculations is bit hit and miss ..but seems to even out ish

An EA will help with this .. but before I embark on that I need to see if the system astands up to scrutiny

With a potential unlimited upside profit on each trade Im not too worried about losers.. although I have stated 16 -18% winners with an EA in control that owuld of been nearer 20%..for a 1min system to have a potential 4:1 risk reward is excellent

Trading in % not pips makes all the difference and is the key ..

I risk 5% every trade irrespective of pip size and that gives me the luxury of placing my SL correctly ie below the last lo or above the last hi

So many trader work out things back to front

'I want 20 pips from this' therefore my SL is '15 pips or 20 pips' and its placed indiscriminately on the chart..it has no bearing from a technical point of view

Am I afraid of taking a trade that includes a news event candle...no ..because my risk calculation will mean Im trading very small as the risk is 5%

When my risk is a few pips my contract total will be higher but still only 5% of the account will be used


place your stop loss in the best position and work out your risk from there
gain an edge in the market like diversity which shows weakness and strength

trade in the direction of the trend for more of an edge

trade with minimum RR of 1:1 for more of an edge

Use a variable TP line that is a reflection of the ATR of the price for more of an edge

I like to gain an edge,it gives us a chance I like a mechanical approach it doesnt rely on gut feel or emotions

We either have a signal or we dont

Its how I think

Cheers

Paulus
0 traders viewing now