Fractal Geometry....Trading?

It has been two years since I last commented about Fractals. So this is an acknowledgement to Forex Factory. The normal tenacity is to avoid
getting into the fracases by Benoit Mandebrot. It doesn't belong in the
realm of "Keep It Simple...Stupid". The term "Fractal" has never been
defined even by Mandelbrot who is considered to be the "Father of Fractal
Geometry". If you really want to gain knowledge in this Fractal hypothesis
then purchase Edgar E. Peters, "Fractal Market Analysis".
To ivob: If it works for you...stay with it. This is only a suggestion...
but use just the one minute time frame. Just remember this: The only
truth is the 'tick' (pip). The 'tick' appears in all the 'time frames'. By just
using the one minute time frame...you can count back your 5 minute, and
your 15 minute and get in the whole Kabukis including your 'tick' with its
location and relationship. Again...count back on the 1 minute time frame
for any of the other time frame. You have the 'tick' in the bargain as well.
ciao,
Tony

The market as unique as it is consists of many basic simple movements.

About the 1 minute....Well....I must have an idea of the trend.....You don't get it from the 1 minute. 1 minute is for entry. For finetuning.

ivob: Evidently you didn't understand what I was suggesting.
You say you use the one, five and fifteen time frames. So you are
in the realm of the 15 time frame...I'm assuming. I assumed you were
using the one minute and five minute to enter and plant for the trend.
Your overall trend would be from the higher time frame...although this
isn't necessary if you're a 'hit and run' trader. There is a reason for
this kind of trading. Using the one minute...and then counting back each
minute section of trade, say for five of minutes, would be the same as
looking at a five min. time frame....same with the 15. Why don't you
check this out by comparing them. You'll see some things that you just
won't see by trying to map with 5, 10, 15 etc. time frames. I tried to
explain that the 'tick' is the only truth. Also, I only suggested this. I
was also assuming that you knew how to read, somewhat, the 'tick'.
Again...you count each minute back on the 'one minute time frame'
for five of those one minute...for the 5. and 'fifteen' of the ones for
the 15. Your 'tick' shows up on all time frames. So you have a mapping
over all of it. I'm sorry if this confuses you. If so....forget it. I'm sorry.

No problem. Thanks for your suggestion. But I'm not a hit and run trader ;-) More like hit and let my profits run ;-)

Actually if you're very experienced you don't even need 1 minute. I just needed it to finetune my entry...to tell me that I was right. To stay in the trade and know that I am right even if price did not move immediately just because the 1 minute told me so. Just a matter of timing. I was often a little too early.

But I know what you mean.. if you're hit and run and go for 5 or 10 pips you can use the 1 minute and be right a very high % of the time. That's what I do...but then just with the overall trend and I like to let profits run as far as possible. The 1 minute allows you to get out on time even if you have the overall trend wrong.

Ivo

Fractal world, how do you thinking?

It's incredible the secrets still to be discovered behind the financial markets and everything and can be charted!

Dont look at it and say "wow, that works!" .. but look where it will NOT work, fails or is wrong.

That's an unproven secret of scientific method. The same was true back in time when people didn't know how lightnings work so they where so sure that there is angry zeus because someone have done something bad :-)

It's like nostradamus .. one who will, will always find something that matches (but oversee everything that doesn't match) .. there exists various psychologic studies for this phenomenon (lost the name)

that's no offense post :-) if it works for you, than it's fine :-)

confirmation bias

( better late then never )

Hello--hello,

Tony, bless you!!! Thanks for explaining everything, sorry it took so long.
I am so lucky to have come across this thread, it is my lucky day. I enjoyed every one of your post to this thread.
You've got WISDOM!!!! I'm taking that to the bank.

What I did was take all those post and deciphered them. My version of the story is real short and sweet. I'm so thankful you shared your wisdom with us.
Ok people--- here's the short version of a long story.
1) Find a Fractal on the chart, any time frame, I'm using the 15 min Eur/Usd. Let's say it is an up fractal (arrow pointing down).
2)Now, the Fractal appearance is delayed, will show after the 3rd bar going up, that's ok.
3)When the Fractal shows, look for candle closes from that point on, don't forget, it is related to the Dot ,the red line, which is a 3sma at ochl(open-close-high-low).
4)Now, we are looking for 3 closes, above the red line ( Dot). This will give a BUY signal, so go long.
5) It is a very simple and effective way of getting into the trend, the best thing about it, it really does work very well.
6) Do just the opposite for a Sell or Short trade.

I know, I didn't put it the way Tony did ,but I figured it out!!!LOL
I wondered how you could tell when the candles would keep running after the Fractal showed up, now I know.
I am using the Damiani Voltmeter and the Bill Williams Market Facillitation Index ( Pink-Squat Bar and Green Bar and Brown--Fade)
The green and pink MFI bars will usually always show on the 3rd Signal candle( above the DOT) to go long or short.

I know there is more to Tony's complex system, however, I came away with a great deal of knowledge. Thanks again Tony, you are " THE MAN"

I need to post just one more suggestion. It is in regards to the Market Facilitation Index. I am also using the Brown ( Fade) bar. It will tell you if the move up or down is stalling or fading out. So, if after the Fractal is formed and the signal is given by the 3rd musketeer from the Dot ( Red Line), you may use the Market Facilitation Index to watch the market price move. Green MFI= market on the move, Pink MFI= Squat, waiting for direction, Brown MFI=Price Fading, Blue MFI= Fake.
I have also placed the Money Flow indicator on my chart with about a 50 level line.

I believe I have finally put it all together ,but it is still some what of a crap shoot. I'm know genius ,but I am determined. Kinda like the WW2 vets were.

I do use Fib levels and pivot lines, I need to know where I might be going.
Bollinger Bands will help tell you the type of Market you are trading in, be it Trending,Ranging,etc.

I hope this helps all of you!!! I really believe Tony was trying to share his wisdom and knowledge with everyone. How generous that was of him. Thanks again Tony, and God Bless You!!!!!!!!!!!!!!!!!!!!

So is it working out for you? I have dabbled in PnL since 1981. I will be pissed/ecstatic if it is that easy.

Wow, all of a sudden there are 21 traders viewing this old thread! Anyone here who also studied Drummond Geometry?

It's been a year and a few months since I last posted on this thread. I'm really glad to have found this post and it's creator. Although, most of the Geometry talk is above me, I take great satisfaction in reaching my goals. This thread opened some avenues for me in that quest. I don't believe there is a mathematical equation or some calculated formula to trading the forex. There is Chaos though. There are Fractals, high volume and price fluctuation (ticks),best time to trade,trends and the Fibonocci numbers that the Market Makers use. This is where you will find success. This is where I found it.
First, let's define a Fractal. A fractal is nothing more than a change in Behavior to quote Bill Williams. Now what do you need to change that Fractal's Behavior?
You will need higher and higher volume or price action or VSA, what ever you want to call it. All the same. Simply price fluctuation . You will say, well there are a lot of Fractals on that chart of mine. Your right, but the key is to know which Fractal is your " Sugar Daddy". This Sugar Daddy Fractal is going to Breakout and take you to Vegas Baby!!! Gonna make a move on those Fib Lines and take you to the limit. It's gonna make that move because it's got all the volume of cash it needs. This Sugar Daddy Fractal started at the Bottom and gonna be on top soon. LOL. Pretty simple.
Now in all seriousness, I will explain the way I trade. Years of research and heartache went into this, but I am a determined individual. First of all I do use some Indicators, it's just easier to glance at,because there are quiet a few fractals and candles and my eyes are not what they used to be.
Put up a chart on a one hour time frame. I trade the EURO/USD, but this will work on any currency, just make sure your on the 1 hour time frame. Next place your Bill Williams Fractals on a bar chart, add the Hieken Ashi on default, Put up a RSI set on Median price HL/2 with a 10 period and 35,50.65 levels. Bring up your volume indicator and use only the Green Bars, make the Red colors(none). Place a 5 EMA moving average at median price HL/2 and a 10 EMA with median price HL/2. I came across a CCI arrow Indicator that I placed Just because it show ups just after the in "Play Fractal" appears. The CCI is set at 10 Period and has levels at 50 and -50. Now aren't all these Indicators looking Pretty. LOL
Now for the trade. It is really very simple. You are keying in on a Fractal that is going to be Broken, a Breakout. An Up Fractal Or Down Fractal, depends on which way the price is going to retrace up your Fibonocci lines. You have to set the Fib Indicator. Always look to your Left on the chart!!! Set the FIB from a Previous high candle to a previous low candle , these are highest and lowest in your past history on the chart. Again the Fib is set on which way the price is going to retrace. Just go backwards 12-24 hours, that will do. The price of the currencies will have fluctuated enough to set the Fib Indicator. Now, Watch for a cross on the 5 and 10 ema along with the RSI crossing the 50 level ,although it could be the 35 or 65 level, you'll get the hang of it soon enough. Now, the volume is going to increase with the breakout on the fractal in play, remember always look to the the left for that fractal. Look to right for the crossing ema's. Look for 2-3-4 high volume bars(GREEN), that's the fuel to make the Breakout. It all works out very smoothly with the crossing of RSI,EMA's and Volume increasing. The Heiken Ashi is there for reassurance. It not there to justify any trade.
Having witnessed the Breakout from the Fractal, you will need to look at taking a profit. Mine is set at 30-35 pips, although I'm always watching and may let it run, depends on how the Fib is looking. The stop loss is set at 20 pips, so you have about 1:1.5 ratio, although this is very conservative.
In conclusion, Trading the Forex market can be made easy. Money Management is an important key. Just don't risk more than 2-2.5% of your money on any trade. That $40$60 if your account is $2000.00 or so and trading with a 20pip stop loss and a$1- $1.50 lot. If you can make just a couple of these trades a day,( $90-$100.00) then in a months time you will be in High Cotton. Of course there is always the risk of losing every cent you have trading the Forex Markets. I am just letting you in on my little secret to success. This is after years of frustration.
In Summary, Forex is about price fluctuation, the Fractal is about Behavior change. Volume make the fractal behave differently . The Banks and Market Makers work off the Fib numbers, these aren't just magical numbers, they are there for a reason and they choose to use them. Just look for the magical Fractals there out there in abundance, each and every day. Good Luck to Ya !!!

A life well lived my friend.
You write with passion.
Cheers, H

nice