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why have you accepted the price-predictability assumption?

  • #261
  • Dec 22, 2013 10:36am Dec 22, 2013 10:36am
Quoting Mingary
{quote} There is no "systematic edge" that can be found.

I am using my system with success.I do use discretion as everyone should like high impact news,major bank rates change etc.
With any system discretion should be used.Because we are dealing with human emotions greet/fear which reflect on price high discretion is a must over systematic systems so edge is traders knowledge which is subjective to measure.
I tend to agree with you that even pure systematic system requires human discretion.To me system is a base where trade has high probability to succeed but even then you must be looking at time of day ,news impact to pull the trigger.
regards
In trading, you have to be defensive and aggressive at the same time
  • #262
  • Dec 22, 2013 10:36am Dec 22, 2013 10:36am
Quoting the redlion
To my surprise this thread has gone to sh*t, but I took care of the problem. Seems that mikkk01 is disruptive and contributes nothing to the conversation.

Hey Red,

I would like to personally apologize for my role in turning your thread upside down, to both yourself and all of the members who have signed up to contribute to this thread.

Best of the Festive Season to all of you!!

Keep on, Keeping on!

Money Can't Buy Happiness. Poverty Can't Buy SHIT! You Choose!
  • #263
  • Dec 22, 2013 10:40am Dec 22, 2013 10:40am
Quoting PrymeTyme
{quote} you cant predict but anticipate something is about to happen/change , due to what price did in the past and what it is doing now at a certain level... like lets say we are in a down trend (background) , u see that price moves towards a fromer support level (location) now as we trade towrads that support the momentum/selling pressure reduces / the downside activity tappers of , and we see an exhaustion of sellers.. while in the same time we see buying activity coming in the market , ie. sellers losing steam , while fresh new money in from...
Yep, buy a pull back in an uptrend, place the SL at a level the uptrend would likely be broken.

Repeat until rich.


Simples!
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #264
  • Dec 22, 2013 10:42am Dec 22, 2013 10:42am
Quoting Davit
{quote} I am using my system with success.I do use discretion as everyone should like high impact news,major bank rates change etc. With any system discretion should be used.Because we are dealing with human emotions greet/fear which reflect on price high discretion is a must over systematic systems so edge is traders knowledge which is subjective to measure. I tend to agree with you that even pure systematic system requires human discretion.To me system is a base where trade has high probability to succeed but even then you must be looking at time...
We are on the same page.
However, my experience has been and still is that no edge is best.
If edge = system then NO system is best.
  • #265
  • Dec 22, 2013 10:44am Dec 22, 2013 10:44am
Quoting Turveyd
{quote} Yep, buy a pull back in an uptrend, place the SL at a level the uptrend would likely be broken. Repeat until rich. Simples!

Just as an intellectual debate could you elaborate at what point trend stops being a trend.What is your criteria that tells you "trend is still intact" and I will buy in pull backs.Furthermore forex trends roughly 20% higher TF you go this becomes more obvious.80% forex is in range but this is hard to see on lower tf.
regards
In trading, you have to be defensive and aggressive at the same time
  • #266
  • Dec 22, 2013 10:52am Dec 22, 2013 10:52am
Quoting Davit
{quote} Just as an intellectual debate could you elaborate at what point trend stops being a trend.What is your criteria that tells you "trend is still intact" and I will buy in pull backs regards


That issue took me years to solve so its going to cost you hmmm 20pence Lola

Look at the M1 chart in my M15 thread, that's how I do it.

Just increase the envelope sizes for different TF's.


Reasonable predictable ranges based on ma's.
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #267
  • Dec 22, 2013 11:00am Dec 22, 2013 11:00am
Quoting Turveyd
{quote} That issue took me years to solve so its going to cost you hmmm 20pence Lola Look at the M1 chart in my M15 thread, that's how I do it. Just increase the envelope sizes for different TF's. Reasonable predictable ranges based on ma's.

If it works for you its fine but to me M1-M15 charts are hardly reflection what the trend is doing.You are basically trading market noise unless you start with lot higher TF and zero down for entry.
In trading, you have to be defensive and aggressive at the same time
  • #268
  • Dec 22, 2013 11:06am Dec 22, 2013 11:06am
regarding generators. Does it matter that someone can pick out a real chart from 2 random generated.
A real answer would be No3 is real the other 2 are false not in an order as 321 312 I got it wrong and had a 1 in 3 chance lol, but theoretically the 2 generated charts could of been traded.
Predictability time,,,, last year the e/u was free falling and this was predictable and suddenly it reversed for 800+ pips (random) many people got stung in these rooms and I was barred from a room for suggesting that this might happen, the guru was put in his place. Anyway this reversal could of been seen as noise and actually it was in a big sense it did drop before rising again
SEE LINE,TRADE LINE..PRICE HAS TO GO SOMEWHERE,,, PRICE WILL GO SOMEWHERE.
  • #269
  • Dec 22, 2013 11:34am Dec 22, 2013 11:34am
Of course, you won't be able to predict price behavior just looking at a chart ... lets make two things clear:
1- How many levels price can reach ?
2- Are central banks gods ?

I can assert with a stake of arguments supporting me , that EURUSD will never reach 1.80 tomorrow morning or in the next month or two or even three or maybe a year or two. Everything equal, any price is the sum of a total compounds that present itself as unit of value Aka the value as of today to a one unit of EURUSD is equal X. X would be the total sum of three things " Momentum , Sentiment & underlying fundamentals".

Let's take that example :


Two hours ago an Alien star ship was seen hoovering above the white house . Though price will experience immediately the swift action of bad momentum surrounding the American economy, sentiment may consume the hit and carry out in the original direction support by fundamentals. But if another or the same star ship appeared again, sentiment then will either neutralize or start forming a bias of an alien invasion. If a hostile act was promoted then a fundamental compound will be to the equation or calculation that " USA is at war". Just like the tip of an ice berg , it starts small then medium term echos it and longer term ability to create a giant ice ball the size of a city ...

So, a trend can't be created without the alignment of the three compounds. As momentum shifts rapidly and tends to be chaotic in nature & sentiment tends to be data driven and fundamentals are okay with short term fluctuation as long as the big picture is intact.

This leads to conclude , price is predictable in certain areas and certain conditions with limits of time frame - but not to the extent that you are able to predict variations and be accurate with decent percentage. Since price levels are infinite , so it will be the possibilities of price moving ups and downs till it reach a specific level.


On the central banking issue, though central banks are actually created to manipulate money markets - they can't break a well formed trend. Since the currency in question represents the purchasing power of an economy that is well represented in economic indicators & data released. A simple price floor or ceiling won't hold too much till the actual economic indicators itself is altered. So, in reality they are manipulating the compounds of price not price itself. The Swiss SNB can't indirectly maintain the price floor without taking direct losses in the FX reserve management , the Feds with all their billions in QE1 - QE2 - QE3 can't return inflation number above 1% or Jobs market above 10 years moving average and finally BOJ can't help with Japanese products losing competitiveness to South Korea or China.

The classic case this year will be the Australian central bank, they were able finally to move the selling Aussie from a momentum event to a sentiment bias. But, as of today they can't make it as a central part of a policy that driving the Australian dollar lower and mining activities higher.
"It's the Margin, Stupid."
  • #270
  • Edited 12:09pm Dec 22, 2013 11:56am | Edited 12:09pm
An example of how I trade market inefficiency .

I observe a group of pairs.i monitor there value change intraday.by taking this view point I can determine the overall markets behavour .from observing the market in this way I have dwtermined for the best part that it is a very efficient structered set of instruments.but it is by no means perfect.it does not always deal with new information very well.theres many idiosyncracies that can be seen from this view point.

I have made lots of trades from the failings of the market.a good example would be new information from europe .unexpected .euro drops 80 90 pips as liquidity Is pulled.theres a moment of correction especially within the related pairs values.those oppurtunities are very rewarding and no charts are required.

Looking at the overall market as a whole.its structure is clearer to see.when it fails.its periods of total harmony. Its stalling points .when randomly moving through the range.ect.ect
  • #271
  • Dec 22, 2013 12:43pm Dec 22, 2013 12:43pm
Quoting the redlion
{quote} I would argue that the 1.20 euro floor on the CHF, and the BOJ QE in order to deliberately weaken the Yen, pokes holes on your assertion.
I didnt say that it will always work, as human nature is unpredictable, but the CB does everyting in their power to reach their goals.If they fail thats because the market has other plans for itself.

Quoting Davit
{quote} I am using my system with success.I do use discretion as everyone should like high impact news,major bank rates change etc. With any system discretion should be used.Because we are dealing with human emotions greet/fear which reflect on price high discretion is a must over systematic systems so edge is traders knowledge which is subjective to measure. I tend to agree with you that even pure systematic system requires human discretion.To me system is a base where trade has high probability to succeed but even then you must be looking at time...
Agreed, my system is working very well also.But i dont understand what do you mean by human discretion, you cant leave the EA to run without supervision ,so you either do some market research each day before placing trades or just check in time to time to resize stoploss or clear up a few unprofitable trades by the EA?
"There's a sucker born every minute" - P.T. Barnum
  • #272
  • Dec 22, 2013 1:13pm Dec 22, 2013 1:13pm
Market is not random, beacuse the psychology of the masses are very predictable. Great traders trade the people not the market.
Wherever you go, there you are.
  • #273
  • Dec 22, 2013 2:30pm Dec 22, 2013 2:30pm
To a certain extent...

Market can be very predictable, but on this, I will qualify my statement to it may be more pair specific than not.

Supply and Demand zones typically follow the independent trade sessions and these areas of market can typically be thought to played by all active sessions.

EUR/JPY will can move equally as heavy during the TK session as does when London comes to play, where as you will find EUR/USD playing shallower ranges during the TK session but typically be able to find the same ranges of play during all of the 3 relevant sessions, being NY, TK and London.

When they touch supply and demand, forecasting tops on a long market or bottoms on a short will leave you standing in front of the speeding train or catching the proverbial falling axe, but if you pay attention to who is actually driving price, observation of session opens can leave you with the ability to see entire range of market traded throughout a typical 24 hour period.

With this being said...Brother V is correct, a major news even can change the range of market moving away from the S/D zones...but even when this happens, it is just a matter of time. The ranges are predictable, when the Market will play by it's own clock.

Are you going to sit around and wait for this, or assume it is always the case?

Sure...you could.

Or try to capture the limited inside ranges traded in direction of the strength, hammer them for a little heavier than standard risk and step away from the chop.

Is this the only way to trade?

Cripes NO.

But if you are looking to capitalize on the apparent Predictability of Market...this is the way it gets done.

Your own personal frame of reference is how you should steer your trades. If you believe in the randomness and are capitalizing off of it...Have At it.

If you want to minimize your risk and trip with the sessions in favour of the major...just another way to skin the same cat.

My dos Centavos...
Money Can't Buy Happiness. Poverty Can't Buy SHIT! You Choose!
  • #274
  • Dec 22, 2013 3:16pm Dec 22, 2013 3:16pm
Quoting Magix
{quote} Hey Red, I would like to personally apologize for my role in turning your thread upside down, to both yourself and all of the members who have signed up to contribute to this thread. Best of the Festive Season to all of you!! Keep on, Keeping on!
Same here.
If you are good at something, never do it for free--Joker
  • #275
  • Dec 22, 2013 3:29pm Dec 22, 2013 3:29pm
Quoting Magix
Or try to capture the limited inside ranges traded in direction of the strength, hammer them for a little heavier than standard risk and step away from the chop. Is this the only way to trade? Cripes NO. But if you are looking to capitalize on the apparent Predictability of Market...
That sounds very much like I'm trading these days, amazingly predictable and dependable so far, too much so, it's too easy shoulda spotted it years ago, I'd have my Ferrari ( not 1:1 scale ) already.
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #276
  • Dec 22, 2013 3:29pm Dec 22, 2013 3:29pm
Quoting jmn5611
{quote} Same here.

Sorry dude, weeks ago I had you confused with someone else, similar name who's a scammer, very sorry!!
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #277
  • Dec 22, 2013 3:48pm Dec 22, 2013 3:48pm
A few mistakes i have committed & saw people making :

1- When market direction is well understood by participants , they decrease leverage and position size - but when tops and bottoms been violated while markets are grasping for direction, they increase leverage and position size ... in both cases, risk is well anchored but not payable. When i started early in this business, i heard someone saying " I only risk 1% of my account to any given trading setup.. no matter how confident i'm, only 1%"

Later on, i found this is plain stupidity. If risk is not factored in as a variable, payment will be also static. Leading to only you have to guess the direction of the market 6 times out of 10, which could be done on longer time frame but not that possible on smaller time frame. In a situation where levels of confidence and predictability is high, the window of opportunity will be short lived and so is the reward. So, once you are done with that - you won't be needing to speculate each and every move.

So, adjusting predictability to time frame :

1- Late New York session , is more predictable in price action then early London , late & early Tokoyo.
2- Friday is more predict then Monday.
3- Last week of trading prices are more predictable ..

so on and so forth,

2- Predicting a move on the wrong time frame. How many people shorted the euro while doing day trading, citing " the euro is doomed " or the french wants cheap exchange rate or the German's exports will get a hit .. i see it on this forum, more times then i can count.

Taking a daily trade based on some long term fundamentals, that could take years to filter in the economy .. is misleading & penalized by losses. Taking a longer term trade because of sentiment or a shift in momentum , is again misleading. The tourists won't give a fuck if they pay 5 cents more. For example: I was talking to a Canadian friend of mine, telling him that the canadian dollar is now a one dollar and five cents. The guy couldn't believe it , he thought USDCAD is still trading at 1.20 area ! Needless to say , that my friend is well contacted into the tourism industry. The thing is, the grand economy is so big and diversified that any news will swing it right or left.

So, once a prediction and its correlated length is adjusted the time frame - price can be fairly predicted to certain extent and certain conditions.
"It's the Margin, Stupid."
  • #278
  • Dec 22, 2013 4:15pm Dec 22, 2013 4:15pm
Quoting Vachus
So, once a prediction and its correlated length is adjusted the time frame - price can be fairly predicted to certain extent and certain conditions.

Add these to the file of, "Market shit that will make your head Spin".

When I was trading part time, and a lot more due to the fact that I was limited to watching ranges during periods I was awake...

I used to observe a quite common occurrence for forecasting range from TK to London/NY.

I think I have posted a couple dozen of these charts and once upon a time even had an entire file folder filled with them.

What it basically was...is that when Market took off during the Active London Session, I could trade the end of a 100 PIP range to 200 PIP range and then play the retrace by just measuring the number of pips from a Moving Average Cross, to the absolutes in tops and bottoms of market.

I would see where the 20 EMA crossed either above or below the 200 EMA. From there, if market prior to NY open was less than 100, could trade it to that 100 range, if market was grossly above 100, would wait for that 200 to hit and hammer hard against it.

I haven't looked for this in a couple years, not sure if the tradeable range could still be measured the same...but again, was something that was as easy to forecast as a count down timer on a clock. Ya never knew when it would hit the range, but you could easily place a counter trade with reasonable expectation that it was going to be an easy money trade.

When I moved into live, I would just adjust this as a max target for range and when it was hit, ended my active trade session and went to bed. Scalping the counters can pay, but when you trip the trend, it's a lot fackwagon easier!!

See the charts:
Attached Image(s) (click to enlarge)
Click to Enlarge Name: 100pips.jpg Size: 201 KB
Click to Enlarge Name: 100pp.jpg Size: 212 KB
Money Can't Buy Happiness. Poverty Can't Buy SHIT! You Choose!
  • #279
  • Dec 22, 2013 4:25pm Dec 22, 2013 4:25pm
Quoting Magix
{quote} Add these to the file of, "Market shit that will make your head Spin". When I was trading part time, and a lot more due to the fact that I was limited to watching ranges during periods I was awake... I used to observe a quite common occurrence for forecasting range from TK to London/NY. I think I have posted a couple dozen of these charts and once upon a time even had an entire file folder filled with them. What it basically was...is that when Market took off during the Active London Session, I could trade the end of a 100 PIP range to 200...

Very close to what we where working on YEARS ago I see, interesting. Shame that's not this year would of liked to of seen how it looked to my latest setup.


Ofcourse M1 will have a immediate knee jerk that's stupid and not tradeable for more than 6pips reaction.
Nothing to it, but to do it!!! Stick to the plan FOOL!!!!
  • #280
  • Dec 22, 2013 4:40pm Dec 22, 2013 4:40pm
Quoting Magix
Add these to the file of, "Market shit that will make your head Spin". When I was trading part time, and a lot more due to the fact that I was limited to watching ranges during periods I was awake... I used to observe a quite common occurrence for forecasting range from TK to London/NY. I think I have posted a couple dozen of these charts and once upon a time even had an entire file folder filled with them.
Well the theory should hold, predicting the last minute of a movie - should be easier then trying to plot the entire movie ... which only leaves u to the question: Why, you payed to see the movie first place ?

Counters are great place to look for small pips , kind of market is opening his hand and giving it to you for free ... problem happens when people start being greedy and forecast the end of the world on the 1 sec chart.
"It's the Margin, Stupid."
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