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Seeking Trading Indicator with 50%+ success

  • #1
  • First Post: Apr 13, 2012 8:31am Apr 13, 2012 8:31am
Hello,

I am in the process of developing a trading system. As a component I would like suggestions on the simplest indicator (indicator, candles stick, pattern etc), that consistently is around 50% right. Ideally I am looking for something simple that would occur frequently throught the day. Though it doesnt have to be that frequent. Thanks.
  • #2
  • Apr 13, 2012 8:47am Apr 13, 2012 8:47am
Coin flip.
  • #3
  • Apr 13, 2012 8:54am Apr 13, 2012 8:54am
Quoting Lonestar
Coin flip.
Come on now, he did say more than 50%
  • #4
  • Apr 13, 2012 8:55am Apr 13, 2012 8:55am
Quoting joseclar
Hello,

I am in the process of developing a trading system. As a component I would like suggestions on the simplest indicator (indicator, candles stick, pattern etc), that consistently is around 50% right. Ideally I am looking for something simple that would occur frequently throught the day. Though it doesnt have to be that frequent. Thanks.
If you want a serious answer then I like stochastics in the direction of the trend. 8,3,3 low/high works for me.
  • #5
  • Apr 13, 2012 8:59am Apr 13, 2012 8:59am
50 SMA
  • #6
  • Apr 13, 2012 9:01am Apr 13, 2012 9:01am
let's combine stuff

50 EMA cross to determine trend. then use pullback on stoch 8,3,3 to enter in the direction of the trend.

use average true range to set TP and SL

we're gonna be rich!
  • #7
  • Apr 13, 2012 9:08am Apr 13, 2012 9:08am
Quoting flyingiguana
let's combine stuff

50 EMA cross to determine trend. then use pullback on stoch 8,3,3 to enter in the direction of the trend.

use average true range to set TP and SL

we're gonna be rich!
Simple is always best...
  • #8
  • Apr 13, 2012 9:35am Apr 13, 2012 9:35am
Quoting Hugh Briss
Come on now, he did say more than 50%
He actually said "consistently is around 50% right."

But in all seriousness, a trader with very honed trade management skills and some knowledge of the technical side can consistently turn profits from a coin flip. I have done it just for shits and giggles. Can't get nearly the edge I have trading other methodologies but it's possible. I think that a lot of traders that use indicators are doing exactly that. Their edge is not coming from any indicator or signal but knowing when to cut their losses, where to put targets, add to a position and whatnot to take advantage of the prevailing market conditions. But I digress...
  • #9
  • Apr 13, 2012 9:42am Apr 13, 2012 9:42am
Im in the process of making a EA myself and i found the awesome oscilator (multi time frame) to be really "awesome" lol i have attached a copy of it if you want to take a look. Keep us posted of your advances. I will be checking out this thread too. Have fun.
Attached File(s)
File Type: mq4 Awesome_(AO)_mtf.mq4   4 KB | 553 downloads
  • #10
  • Apr 13, 2012 10:59am Apr 13, 2012 10:59am
Quoting Lonestar
He actually said "consistently is around 50% right."

But in all seriousness, a trader with very honed trade management skills and some knowledge of the technical side can consistently turn profits from a coin flip. I have done it just for shits and giggles. Can't get nearly the edge I have trading other methodologies but it's possible. I think that a lot of traders that use indicators are doing exactly that. Their edge is not coming from any indicator or signal but knowing when to cut their losses, where to put targets, add to a position...
I think it's starting with a small position and adding on that's the key rather than what indicator you use but I'd go with the coin idea. Is there a coin flip ea?
  • #11
  • Apr 13, 2012 11:10am Apr 13, 2012 11:10am
Quoting flyingiguana
let's combine stuff

50 EMA cross to determine trend. then use pullback on stoch 8,3,3 to enter in the direction of the trend.

use average true range to set TP and SL

we're gonna be rich!
I have tested a system very similar (with 5,3,3 setting) to that and got 55%-56% accuracy with almost 2:1 RR. But, the exits are not totally mechanical.
  • #12
  • Apr 13, 2012 11:37am Apr 13, 2012 11:37am
Quoting joseclar
Hello,

I am in the process of developing a trading system. As a component I would like suggestions on the simplest indicator (indicator, candles stick, pattern etc), that consistently is around 50% right. Ideally I am looking for something simple that would occur frequently throught the day. Though it doesnt have to be that frequent. Thanks.
Jos there are too many variable in indicator trading for anyone to be able to answer that question. I understand what you're trying to do, but it's really difficult to execute.

If I could make a simple suggestion - before you jump into the process of trying to identify that indicator and ultimately the specific parameters that give you that 50% win/loss ratio read these two books. Evidence Based Technical Analysis and Optimal Trading Strategies. These will help you properly structure you back-testing and account for different impacts, which all affect the quality of your test results, which directly correlates to how well things work in real-time.

If you're not great at math, don't let that throw you off from trudging through the information. There is a lot of really good theory in both that you can distill into practical thinking and application for your own usage.

If 50% winners were easy to find over the long term our job as traders would be a lot easier. The problem is, the markets are dynamic and what is working today most likely will not work in the very near "tomorrows" and knowing when to switch to the next most efficient thing is always easier in hindsight. - John
Trade Small. Be Patient. Learn to Survive.
  • #13
  • Apr 13, 2012 12:12pm Apr 13, 2012 12:12pm
There is a good trader recently I read stated that with just a simple trading method which can produce just a 40% winning trades in RR 1:2 and 1 pip = USD1, he/she would be on the way to wealth!
Trade As A Sniper
  • #14
  • Apr 13, 2012 12:29pm Apr 13, 2012 12:29pm
U guys know a good scalping indicator for closing the order?
  • #15
  • Apr 13, 2012 12:37pm Apr 13, 2012 12:37pm
Check out here.

http://www.forexfactory.com/showthread.php?t=343533

Might be right up your alley.
  • #16
  • Apr 13, 2012 1:38pm Apr 13, 2012 1:38pm
Quoting FXAnalytics
Jos there are too many variable in indicator trading for anyone to be able to answer that question. I understand what you're trying to do, but it's really difficult to execute.

If I could make a simple suggestion - before you jump into the process of trying to identify that indicator and ultimately the specific parameters that give you that 50% win/loss ratio read these two books. Evidence Based Technical Analysis and Optimal Trading Strategies. These will help you properly structure you back-testing and account for different impacts, which...
exactly what this guy said
  • #17
  • Apr 13, 2012 1:49pm Apr 13, 2012 1:49pm
Quoting joseclar
Hello,

I am in the process of developing a trading system. As a component I would like suggestions on the simplest indicator (indicator, candles stick, pattern etc), that consistently is around 50% right. Ideally I am looking for something simple that would occur frequently throught the day. Though it doesnt have to be that frequent. Thanks.
I am with Lonestar and actually developed the indicator you are looking for. It can be found here in this extracted thread.

The monkey ultimately ate the coin so I had to ask FF to close the thread, but every day at some point the trades were in profit. So that's like 100%, I think. I encourage you to continue this work and choose a coin that is less appetizing to monkeys. It was the key flaw.
Be bullish on you.
  • #18
  • Apr 13, 2012 3:15pm Apr 13, 2012 3:15pm
Quoting Lonestar
He actually said "consistently is around 50% right."

But in all seriousness, a trader with very honed trade management skills and some knowledge of the technical side can consistently turn profits from a coin flip. I have done it just for shits and giggles. Can't get nearly the edge I have trading other methodologies but it's possible. I think that a lot of traders that use indicators are doing exactly that. Their edge is not coming from any indicator or signal but knowing when to cut their losses, where to put targets, add to a position...
really?? then i wonder why most majority HFs with very bright people are so much under-water last years if it is so easy...no offence just a lil bit irony

from mathematic point of view it is impossible to make profitable system with random (50% probability) entries, because whatever risk and money management system you are using its not an edge alone.
  • #19
  • Apr 13, 2012 3:29pm Apr 13, 2012 3:29pm
The learning curve is so difficult to overcome here, that when most traders think they have found a profitable, researched, and backtested method to exploit an inefficiency in the market, by that time the returns to that gap are diminishing or have completely vanished.
  • #20
  • Apr 13, 2012 6:01pm Apr 13, 2012 6:01pm
Quoting katrooo
really?? then i wonder why most majority HFs with very bright people are so much under-water last years if it is so easy...no offence just a lil bit irony

from mathematic point of view it is impossible to make profitable system with random (50% probability) entries, because whatever risk and money management system you are using its not an edge alone.
No offense take since you talking apples and oranges. Discretionary trading and HFs are completely different approaches to trading. Care to site the reference that most were underwater the past couple years?

Again, you're talking risk/money management and I was talking about trade management and technical skills. Out of the 50% winners there will be plenty of trades that can make decent runs and/or be added to to maximize gains and scaled out of reducing risk. A late entry can be scaled into over a range to turn an otherwise losing trade into a winner. Good traders do this type stuff all the time. Identifying which trades that they can get the most out of by using various trade management techniques and technical knowhow. There are plenty of traders whose win rate is less than a coin flip that are still profitable and of course their winners are much larger than their losers but nowhere in my post did I mention anything about risk/reward ratios. You seem to be assuming 1:1 with a 50% hit rate and a random market. Anyway....trade well.
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