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Genesis Matrix Trading

  • #4,141
  • Sep 15, 2012 10:57pm Sep 15, 2012 10:57pm
Quoting realjumper
Last night I had a friend call around who is also a trader, but his learning curve is a little behind mine so he came for some help. I could see what the problem was, and I have been guilty of it myself in the past, and still do fall into the trap occasionally if I don't remind myself. I expect that that most people have done this:

They see the market open at Frankfurt and they watch the candles take off in a direction. They think, "Ok, if this continues I will enter here."

Then a couple of strong candles in the same direction form and...


I thought that happens to only me... glad to hear that , there are others out there . this post should be in the first page for sure. How to i give a voucher to others?? RJ surely deserves one.
  • #4,142
  • Sep 16, 2012 4:30am Sep 16, 2012 4:30am
Quoting realjumper
Last night I had a friend call around who is also a trader, but his learning curve is a little behind mine so he came for some help. I could see what the problem was, and I have been guilty of it myself in the past, and still do fall into the trap occasionally if I don't remind myself. I expect that that most people have done this:

They see the market open at Frankfurt and they watch the candles take off in a direction. They think, "Ok, if this continues I will enter here."

Then a couple of strong candles in the same direction form and...


Somebody says, I don't remember , "When people have a good strategy system they destroy it trying to improve it"
  • #4,143
  • Sep 16, 2012 4:36am Sep 16, 2012 4:36am
RJ, thanks, that is a lesson well worth remembering, often candles will contradict the system unnecessarily, just to agree again shortly afterwards.
Thanks for your valuable contributions.
When all conditions are met - Enter trade - sit back and FRET !!!
  • #4,144
  • Sep 16, 2012 4:43am Sep 16, 2012 4:43am
Quoting realjumper
Last night I had a friend call around who is also a trader, but his learning curve is a little behind mine so he came for some help. I could see what the problem was, and I have been guilty of it myself in the past, and still do fall into the trap occasionally if I don't remind myself. I expect that that most people have done this:

They see the market open at Frankfurt and they watch the candles take off in a direction. They think, "Ok, if this continues I will enter here."

Then a couple of strong candles in the same direction form and...
Good lesson that is perfectly reflected.
Great RJ
  • #4,145
  • Sep 16, 2012 5:43am Sep 16, 2012 5:43am
Quoting vamtop


Somebody says, I don't remember , "When people have a good strategy system they destroy it trying to improve it"
That is so true....The 'problem' with people's perception of Genesis is that its graphical & visual simplicity hides the complexity behind it.

I'm sure that most people look at the matrix and count it as 1 indicator (4 dots either blue or red - easy) when in fact it is none of that.
If I'm correct, bar the CCI line, the 3 other matrix lines (TVI/GHL/T3) are 'made' of at least 2 indicators (if not more) running in the background.
So at a stroke you already have a minimum of 7 'decision makers', add the Stox (5 & 15) + the Yellow MA + the Arrow & the odd Pivot line & you are talking about at least 12 different indicators all needing to be pointing in the same direction to give you valid signal.
How many more do you really need?

But having said that, yes you can add more indicators as extra 'filters' and for sure they will stop you entering some Genesis bad trades but the flipside of that is they will also keep you out & make you miss some good trades. It's a balancing act and I decide to include something extra in my trading only by doing a lot of backtesting and this is my method:
.on the M5 TF I will mark down on my chart all the Genesis trades for a minimum of 1 month.
.for each of these trades I will write down what my Potential New Filter (PNF) was telling me and you have 4 possible scenarios:
1) PNF agrees with a Genesis good trade: that will be marked as +0 (the PNF didn't add anything).
2) PNF agrees with a Genesis bad trade & that trade would have been a 20 pips loss: that will be marked also as +0 (the PNF didn't add anything).
3) PNF disagrees with a Genesis good trade and it would have stopped me from entering a good/valid trade: if that trade 'showed' me a 'realistic' 30 pips, I mark this as -30.
4) PNF disagrees with a Genesis bad trade and that trade would have been a 20 pips loss: that will become +20 (the PNF stopped me from entering a bad trade).
I then add it all up and if:
.it is a negative (-) total or very close to zero then the PNF gets discarded as it hasn't added anything of value: it's only taking some of my attention away from the other stuff.
.it is a big positive number & I will include it in my forward live trading for a month and see if the backtesting results match the live difference in outcome.
It's only then that I decide to keep it or not.

So if you have anything 'new' to add to Genesis' core rules and you have done some proper (and I really mean proper lol) backtesting to backup your claims then I'll happily listen. If not, I think RJ will show you the door lol
  • #4,146
  • Sep 16, 2012 6:55am Sep 16, 2012 6:55am
Hi Realjumper,

I think you are on to something with your little test.
Will give that "flying only by instruments" a try tomorrow -

One question:
How did you set the S/L without seeing the candles of the last swing?
Did you choose 20 Pips by default?
  • #4,147
  • Sep 16, 2012 7:34am Sep 16, 2012 7:34am
Quoting olivierforex
I'm sure that most people look at the matrix and count it as 1 indicator (4 dots either blue or red - easy) when in fact it is none of that.
If I'm correct, bar the CCI line, the 3 other matrix lines (TVI/GHL/T3) are 'made' of at least 2 indicators (if not more) running in the background.
So at a stroke you already have a minimum of 7 'decision makers', add the Stox (5 & 15) + the Yellow MA + the Arrow & the odd Pivot line & you are talking about at least 12 different indicators all needing to be pointing in the same direction to give you...
That's a very good process, Oli, and well described.

Just one point of clarification, though. Each of the lines of the matrix is a single indicator. The output of each indicator is then scaled to the red or blue binary output, which is why it may appear to be more than one indicator per row. Your summary is great. You are still looking at a significant cluster of indicators for signals to enter trades, or not. Presented in a visually simple style for easier and quicker interpretation.
  • #4,148
  • Sep 16, 2012 9:18am Sep 16, 2012 9:18am
Quoting Cody_R
That's a very good process, Oli, and well described.

Just one point of clarification, though. Each of the lines of the matrix is a single indicator. The output of each indicator is then scaled to the red or blue binary output, which is why it may appear to be more than one indicator per row. Your summary is great. You are still looking at a significant cluster of indicators for signals to enter trades, or not. Presented in a visually simple style for easier and quicker interpretation.
Damn, I'm not sure now that a 'significant cluster' is going to be enough lol


Sunday's peace offering ... for those who like to see at a glance what the Stochastics are doing in all TFs, especially those 'Bullish/Bearish Starts' when the Stox have gone OS/OB and have now turned Up/Down and a fresh Genesis signal arrives....
Adapted for Genesis with 11,3,3 Periods - MA Method = 0 (SMA) - Price Field = 0 (High/Low)
Attached Image (click to enlarge)
Click to Enlarge Name: Untitled.jpg Size: 26 KB
Attached File(s)
File Type: mq4 DIGISTOCH.mq4   20 KB | 620 downloads
  • #4,149
  • Sep 16, 2012 3:40pm Sep 16, 2012 3:40pm
Quoting CandleStar
Hi Realjumper,

I think you are on to something with your little test.
Will give that "flying only by instruments" a try tomorrow -

One question:
How did you set the S/L without seeing the candles of the last swing?
Did you choose 20 Pips by default?
Hi,

As I mentioned in that post, I wouldn't advocate getting rid of the candles as I did, I was doing it to prove a point. I was using the simulator, not 'live'.

You can't trade without the candles for exactly the reason you mention.....where to put the SL!!

As I say, the test was done to prove a point.
Doing what you like is Freedom. Liking what you do is Happiness.
  • #4,150
  • Sep 16, 2012 4:09pm Sep 16, 2012 4:09pm
Great words RJ, very relevant for me !!

Oliver, I have messed around with Digistoch, to make it a little clearer.

I have alligned the TF with Stoch value, and colour coded cross ups/downs, and the darkness of colour for stoch value ??
Attached File(s)
File Type: mq4 DIGISTOCH-V2.mq4   10 KB | 802 downloads
I am a fallible imperfect person; so I must be a fallible imperfect trader.
  • #4,151
  • Sep 17, 2012 2:51am Sep 17, 2012 2:51am
Hi guys,

Entered a long trade during Frankfurt open as shown but the trade didnt turn out well. I entered the trade base on i) arrows ii) Stochastics looks reasonable, rising from a recent oversold level. Few possible reasons i can see why it didnt turn out well, i) 15M stochastics was moving downwards ii) Candle did not open above the yellow SMA.

Would like to hear more on what others look out for before entering a trade besides the point i stated, thanks and regards.

http://imageshack.us/a/img833/9784/eu1d.jpg

Uploaded with ImageShack.us
  • #4,152
  • Sep 17, 2012 3:04am Sep 17, 2012 3:04am
Quoting LiuLangZe
Hi guys,

Entered a long trade during Frankfurt open as shown but the trade didnt turn out well. I entered the trade base on i) arrows ii) Stochastics looks reasonable, rising from a recent oversold level. Few possible reasons i can see why it didnt turn out well, i) 15M stochastics was moving downwards ii) Candle did not open above the yellow SMA.

Would like to hear more on what others look out for before entering a trade besides the point i stated, thanks and regards.
2 reasons for me:
. basic PA: the 3140 area had already been rejected twice before and with an entry at 3134 you are not leaving yourself much room before price could hit resistance again. Of course it could have powered through resistance (we didn't know at the time), so on its own that's not a trade killer but at least a warning to maybe wait until price has broken resistance before entering Long.
.M15 Stox is the main one as it was already going down and was in conflict with M5 Stox going up
Stox conflict + Resistance close ahead ---> not a high probability trade
  • #4,153
  • Sep 17, 2012 3:14am Sep 17, 2012 3:14am
Quoting Martyfish
Great words RJ, very relevant for me !!

Oliver, I have messed around with Digistoch, to make it a little clearer.

I have alligned the TF with Stoch value, and colour coded cross ups/downs, and the darkness of colour for stoch value ??
Digistoch_v2 is not loading up properly for me (anyone else having the same problem?)
  • #4,154
  • Sep 17, 2012 3:16am Sep 17, 2012 3:16am
Quoting olivierforex
Digistoch_v2 is not loading up properly for me (anyone else having the same problem?)
Me too does not load properly
  • #4,155
  • Sep 17, 2012 3:19am Sep 17, 2012 3:19am
If I could add a little more perspective on RJ's comments.

As a broad generisation, the vast majority of experienced traders I have met over the years, virtually all have echoed RJ's perspective on trading, it is all about:

- PA (Trend)
- S&R
- Momentum

Or as Corey Rosenbloom wrote in his book "The Trading Course: Technical Analysis, High-Probability Set Ups, and Execution Tactics", Trading is as simple as pick a timeframe, you are comfortable trading, assess the trend, then take the next timeframe down from that, then wait for pullbacks, and trade with the higher TF trend.

Inexperienced traders spend huge amounts of time searching for another indicator that is going to give them that perfect system "the holy grail".

My issue is experienced traders have huge amounts of chart time, that enables them analyse markets with clarity that allows them to make clear trading decisions.

Inexperienced traders, feel they need to add another indicator to confirm what their other indicators say, which leads to confusion, delay in making decisions, and the consequence of possibly (or probably in my case) missing the trade.
I am a fallible imperfect person; so I must be a fallible imperfect trader.
  • #4,156
  • Sep 17, 2012 3:21am Sep 17, 2012 3:21am
Try opening a new chart with this template.

I have this chart minimised in the top corner of my metatrader window
Attached File(s)
File Type: tpl Stoch Signal-1.tpl   3 KB | 578 downloads
I am a fallible imperfect person; so I must be a fallible imperfect trader.
  • #4,157
  • Sep 17, 2012 3:25am Sep 17, 2012 3:25am
Quoting Martyfish
Try opening a new chart with this template
Fact. White screen with the lower numbers Stoch but I do not understand.

Corrected image to TF 5M
Attached Image (click to enlarge)
Click to Enlarge Name: ea 04092012.jpg Size: 16 KB
  • #4,158
  • Sep 17, 2012 3:34am Sep 17, 2012 3:34am
Quoting LiuLangZe
Hi guys,

Entered a long trade during Frankfurt open as shown but the trade didnt turn out well. I entered the trade base on i) arrows ii) Stochastics looks reasonable, rising from a recent oversold level. Few possible reasons i can see why it didnt turn out well, i) 15M stochastics was moving downwards ii) Candle did not open above the yellow SMA.

Would like to hear more on what others look out for before entering a trade besides the point i stated, thanks and regards.

http://imageshack.us/a/img833/9784/eu1d.jpg

Uploaded...
Candle did open above 5 SMA(it retraced) and 15M Stoch looked like, for second, turning up. Plus price was above 60 SMA, so I entered also - lost 12 pips.
Entered on reversal, exited at DP for + 30 pips
  • #4,159
  • Sep 17, 2012 3:37am Sep 17, 2012 3:37am
I use it as a dashboard for stoch
I am a fallible imperfect person; so I must be a fallible imperfect trader.
  • #4,160
  • Sep 17, 2012 3:46am Sep 17, 2012 3:46am
Quoting morris1
Candle did open above 5 SMA(it retraced) and 15M Stoch looked like, for second, turning up. Plus price was above 60 SMA, so I entered also - lost 12 pips.
Entered on reversal, exited at DP for + 30 pips
It's nice to make up for a loss straight after in the next trade/signal.
"15M Stoch looked like, for second, turning up" ... it might have looked like it was turning up but the important part is that M15 Stox had just been in OB territory not long ago....
My personal view: it's a good practice to wait until both M5 & M15 Stox have been in OS territory first before attempting Long trades (PS: I know that M15 Stox rules have not been finalised yet by RJ but I'm willing to bet that once testing/backtesting is over it will be part of Genesis trading in one way or the other)
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