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The similarity system

  • #101
  • Jun 29, 2013 10:28am Jun 29, 2013 10:28am
Hello Friends,

Still really I do not understand the system I may be dumb enough.

Tnx,
Sakthi
  • #102
  • Jun 29, 2013 10:29am Jun 29, 2013 10:29am
Quoting ecneralc
{quote} This is my interpretation: the marked prices where the differences in stochs occur will have a "gravity" effect. So entry would be placed some distance away from these marked prices with the target of reaching back to the marked prices. ie. difference in stochs happen at price A. Price moves away from A. We take enter a position once it has move far enough to let us earn our desired pips (say 20 pips), with the target at price A. SL can be adjusted to one's risk reward appetite. As to when and where to place the entry we...
You are EXCEPTIONAL.!!!!!! Where you place entry above/below the marked price is your choice!!!
WELL-DONE!
  • #103
  • Jun 29, 2013 10:31am Jun 29, 2013 10:31am
Quoting Madmoney
Can't really see a blatant difference, but I will be testing.
mADMONEY, the stochs will differ at some point! As long at the difference has not occurred the current trend will continue -generally -.
You spot a difference everyday, if you are watching multiple time-frame pairs!
  • #104
  • Jun 29, 2013 10:35am Jun 29, 2013 10:35am
Quoting billbss
{quote} I think I understand it. If I'm wrong eurusdd will correct me. You have to be looking at the actual values of the stochastics to see the difference. It's impossible to show that on an uploaded chart. The readings you see on the blowup are for the current bars only.
THANK YOU!!! YOU GOT IT!!!! You summarized it nicely!!!!!

yOU NEED TO WATCH YOUR CHART TO SPOT IT!!! ONCE YOU DO, MARK THAT PRICE AND target it. As long as you have not seen a difference, have faith that the current trend will generally continue!!!
  • #105
  • Jun 29, 2013 10:39am Jun 29, 2013 10:39am
Quoting billbss
{quote} Let me see if I understand this- I probably don't. At A,B and C there is a difference in stochastics. One lags the other. Since price is heading up at those points the lagging TF will have to go up to catch up. You would buy at those points. At D price is headed down. You would sell. When price reverses, you would enter a trade in the direction of the reversal and exit at these points. Am I close?
Yes you are right but you missed one little point! The point where you spotted the difference will be returned to after the move is done!!! So, it should be a price to MARK!!!!!
  • #106
  • Jun 29, 2013 10:45am Jun 29, 2013 10:45am
bECAUSE OF THE SIMILARITY OF YOUR CHARTS, whenever there is a difference in your stochs, that is a window into PRICING! MARK that price! The stochs must agree >90% of the time, very rarely will they differ. When they do, one will have to catch up!
​I have back-tested this for long and stochs differ -----> if price continues in the current direction, it will return to the spot where you spotted the difference. This is good, but you have to watch your charts to spot it. That is why it is called a window. It opens and closes very fast!!!!
  • #107
  • Jun 29, 2013 11:08am Jun 29, 2013 11:08am
People have to understand that the similarity principle is a good way to spot mis-pricing in the market. However, the indicators you used also matters. For example, the stochs-method is 50% more efficient than the cycle-identifier method! However, it is 10% less efficient that the bollinger method. This method requires only one time-frame! Look at the red&white lines in the top and bottom windows in the chart below!!!!

Do you see that both are similar????
Now, the top window is real-price and so, whenever the down window differs YOU HAVE A TRADE! The down will always play catch-up with the top!!!!
In the first there are no major difference!!!
Attached Image (click to enlarge)
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Spot the difference in the chart below (YELLOW), Both lines agreed really for the first time at BLUE and beyond!!!
Attached Image (click to enlarge)
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  • #108
  • Jun 29, 2013 11:14am Jun 29, 2013 11:14am
Nice! what's the MA? 5?
  • #109
  • Jun 29, 2013 11:14am Jun 29, 2013 11:14am
What is the red line in the bottom window?
  • #110
  • Jun 29, 2013 11:19am Jun 29, 2013 11:19am
Quoting Madmoney
Nice! what's the MA? 5?
EMA 1!!!!!! The period must be one!!!!!
  • #111
  • Jun 29, 2013 11:20am Jun 29, 2013 11:20am
Quoting billbss
What is the red line in the bottom window?
stochastics. So you can put this on your stoch-similarity system.
  • #112
  • Jun 29, 2013 11:23am Jun 29, 2013 11:23am
Quoting Eurusdd
{quote} stochastics. So you can put this on your stoch-similarity system.
What are the parameters of the Stochastic?
Thanks
  • #113
  • Jun 29, 2013 11:24am Jun 29, 2013 11:24am
Notice that we spotted a difference for the first time at A, price went up and we got similarity for the first time at B. Price that went back to the level of A!!!!!
Attached Image (click to enlarge)
Click to Enlarge Name: vv.PNG Size: 84 KB
  • #114
  • Jun 29, 2013 11:44am Jun 29, 2013 11:44am
Quoting Eurusdd
Notice that we spotted a difference for the first time at A, price went up and we got similarity for the first time at B. Price that went back to the level of A!!!!!{image}
Hi Eurusdd,

Thanks for sharing your idea. I want to ask what is the pair and time frame for this chart? and also what is the stoch settings?

Thanks
  • #115
  • Jun 29, 2013 11:58am Jun 29, 2013 11:58am
This is pretty interesting. Finding irregularities in the market and trade it back to balance. #Follow
Pivot Boss in the making~
  • #116
  • Jun 29, 2013 12:17pm Jun 29, 2013 12:17pm
Quoting jurn_e
This is pretty interesting. Finding irregularities in the market and trade it back to balance. #Follow
Use the similarity principle to develop super-trading systems. It is the best way to spot mis-pricing without using super-computers and arbitrage arguments.
Look at this Monthly chart!!!!

First difference spotted at A, first similarity occurred at B. price started to drop back to A from that point! 2,000+ pips IN A SHORT TIME!!!
Attached Image (click to enlarge)
Click to Enlarge Name: hh.PNG Size: 75 KB


So, mis-pricing started at A, and the correction started at B. Notice that similarity is place from B onward!!!!
  • #117
  • Edited 2:43pm Jun 29, 2013 12:20pm | Edited 2:43pm
is this quite right?
comment please
30m = 4-1-4
1hr = 2-1-4
Attached Image (click to enlarge)
Click to Enlarge Name: testing similarity.png Size: 90 KB
  • #118
  • Jun 29, 2013 12:25pm Jun 29, 2013 12:25pm
Quoting winterfell
is this quite right? comment please 30m = 4-1-4 1hr = 2-1-4 {image}
and another question:
when is the exact time for a spike up/down (on CI) occurs?
do i have to wait every 30min or 1hr every time a candle close? or there is another way to know it
please enlighten me

ps:sorry for bad english
  • #119
  • Jun 29, 2013 12:32pm Jun 29, 2013 12:32pm
Quoting Eurusdd
{quote} Use the similarity principle to develop super-trading systems. It is the best way to spot mis-pricing without using super-computers and arbitrage arguments. Look at this Monthly chart!!!! First difference spotted at A, first similarity occurred at B. price started to drop back to A from that point! 2,000+ pips IN A SHORT TIME!!!{image} So, mis-pricing started at A, and the correction started at B. Notice that similarity is place from B onward!!!!
How long have you ben trading live with this?
  • #120
  • Jun 29, 2013 12:35pm Jun 29, 2013 12:35pm
Quoting winterfell
is this quite right? comment please 30m = 4-1-4 1hr = 2-1-4 {image}
Hi WINTERFELL.,
Using the across brokers, same time-frame pairs, it is clear that my chart and yours agree at the places I circled!!! You are OK!!! Note the across brokers dis-similarities at the places I did not circle.
One this is clear though, EURUSD will aim for the low for our charts to finally agree. Therefore, don't be surprised if she opens DOWN!!!!
Attached Image (click to enlarge)
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