The similarity system | Page 304 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Similarity: A Practical Approach 859 replies

Similarity Trading - The ZZBB Method 215 replies

Rainbow similarity 256 replies

Similarity Stuff 17 replies

Directional Similarity 0 replies

Attachments: The similarity system
Exit Attachments

The similarity system

  • #6,061
  • Aug 18, 2014 11:39am Aug 18, 2014 11:39am
Quoting kprsa
{quote} Ok, most likely not a bug then.
That's what I was thinking, thanks.
  • #6,062
  • Aug 18, 2014 11:40am Aug 18, 2014 11:40am
Quoting Eurusdd
eurusd is trying to solve the 1.3347 problem/

Can you please check and tell me if this diagram means anything to you. Is there an issue 1.33920 and 1.33598.
Attached Image (click to enlarge)
Click to Enlarge Name: Similarity Issues to be confirmed.GIF Size: 159 KB
If you fall, I shall be there. - The floor
  • #6,063
  • Edited 12:32pm Aug 18, 2014 11:46am | Edited 12:32pm
Quoting Eurusdd
{quote} I have not gone yet, so i haven't returned. And that is not what I meant. 6 Hs is a rare event with probability 0.5^6= 0.015625. So, if the probability you will meet a mad person on your way to school is 0.015625 and you just met one, then it is safe to say that the next person you meet will not be mad. That is a safer bet because if the next person is mad then you just witnessed and event with probability 0.5^12 = 0.00024441 of occurring. How many people do you have to meet on your way to school on average for this event to occur? 1/0.00024441...
i just want to comment that for a true fair coin, prob of H after 6H in a row is still 1/2 and not any lower. Since the toss are independant, first 6 H dont affect prob of next toss. you can also see it like this - after 6 H, there are two possibilities, next is tail or head.
prob of 6H in a row is (1/2)^6
prob of 6H in a row and then next one T is (1/2)^6 * 1/2 = (1/2)^7
prob of 6H in a row and then next one H is (1/2)^6 * 1/2 = (1/2)^7

so you see that prob of 7th toss coming up T is same as prob of 7th toss coming up H.

So even though in absolute terms, on the outset the prob of 6H then another H is very low (1/2)^7, once the first 6H have happened, the prob of getting another H (to make it 7 H in a row) is exactly 1/2.

Now not saying you can't think like this in forex as the events in forex may not be totally independant so chances of another rare event may reduce after one rare event (depends on what event are we talking about really). But for a coin toss, you dont get any advantage by betting on T after 6H in a row.

check this for bigger discussion on this http://www.drdobbs.com/architecture-and-design/20-heads-in-a-row-what-are-the-odds/229300217
Think : Trade : Live Life
  • #6,064
  • Aug 18, 2014 11:55am Aug 18, 2014 11:55am
I have a new level formed at 1.33522. So my current levels above and below are:

1.34110
1.33986

1.33522
1.33475
1.33415

Can't wait for Eurusdd's hints on timing to see which way first!

If we're going for closest, we should see 1.33415 before it turns back up. But on my chart I have a transient zone at 1.33787 that was breached and so I believe that would have been a candidate for a scalp. Rather a big and scary scalp though down to 1.33522 and possibly down to 1.33415 so I probably need to deduce my 'h' is a little off!
  • #6,065
  • Aug 18, 2014 12:02pm Aug 18, 2014 12:02pm
Quoting Eurusdd
{image} Someone once asked me if i trade binary options and I said yes. In fact, i find it easier than spot.... Just placed two trade for today rate of success is >95% So if anyone is doing binary for eurusd, i can help you here, when I return. !!!
hi I am interesting in this binary options. The place where you are doing BO-forex business, I am betting matches, so I know this place So I am interesting and when you will come, you can contact me.
  • #6,066
  • Aug 18, 2014 12:07pm Aug 18, 2014 12:07pm
Quoting vlady1974
{quote} The way price behaves around a transient zone provides the trade opportunity. If it goes through the transient zone and enters the recurrent zone on the other side. If it goes through the transient zone but in the same bar returns to the transient zone (ie. bounce), then you can trade in the direction of the bounce, again using a recurrent price not a transient price.
I changed your text a little bit for my own and maybe others clarity. When you say trade in the direction of the bounce; if i throw a ball at the floor, the direction after it has hit the floor is towards the ceiling. Although I get the feeling you mean the direction of the "pricepillar", so if price touches a top but sinks in the same bar, the direction of the bounce is up.

Thanks for the response though. It was very informative.
  • #6,067
  • Aug 18, 2014 12:34pm Aug 18, 2014 12:34pm
Quoting Velites
{quote} I changed your text a little bit for my own and maybe others clarity. When you say trade in the direction of the bounce; if i throw a ball at the floor, the direction after it has hit the floor is towards the ceiling. Although I get the feeling you mean the direction of the "pricepillar", so if price touches a top but sinks in the same bar, the direction of the bounce is up. Thanks for the response though. It was very informative.
These are the 2 basic outcomes. There are more... but basically, you don't put a pending order in the transient unless you have a technique or an edge that guarantees that price will go through the transient region (and hence never return there 97% of the timeframe).

Edit:
I know some of you will nitpick at the other possibilities. But try and get the message that if you knew IN ADVANCE that a region wasn't going to be returned to... if price goes through it, near it, around it, under it or over it.... trade AWAY from the zone. Trade away from the same side your in, or from the other side if price goes through the Transient zone.

Also.... try and see this develop as price action happens. This will allow you not to rely on an indicator. The minute you see a top or bottom, count back h number of bars until you see price cross through your top/bottom price. Find the points where price was visited only at that one bar. Draw a line like a S/R line.... draw more if you think it's a range. But then see what happens when price comes near it. If from below.... short. If from above long. Put SL inside the transient zone. See how many times you're right/wrong.
Attached Image (click to enlarge)
Click to Enlarge Name: TransientVSRecurring.png Size: 10 KB
A pip is only worth it if you know how much you risked to earn it
  • #6,068
  • Aug 18, 2014 12:41pm Aug 18, 2014 12:41pm
I think this is one way to define a mean reversion strategy. What EURUSDD is saying is that once price start trading in zone that has not reached in last h bars, it will likely revert. So basically we are trying to calibrate how long you should let it go out of the zone and how much you should expect it to revert. This also jives well with EURUSDD saying that he likes to trade balanced market where supply / demand is some what balanced.

So this means this strategy should not be traded before or just after major new events. it is better to trade in periods where there is little outside news and only thing that is moving the price is seller / buyers which are balanced so price will likely not keep running in one direction.
Think : Trade : Live Life
  • #6,069
  • Aug 18, 2014 12:45pm Aug 18, 2014 12:45pm
Re coin toss I seem to remember reading somewhere recently that a Las Vegas Casino reported that red came up 41 times in a row.
  • #6,070
  • Aug 18, 2014 12:47pm Aug 18, 2014 12:47pm
Quoting vlady1974
{quote} These are the 2 basic outcomes. There are more... but basically, you don't put a pending order in the transient unless you have a technique or an edge that guarantees that price will go through the transient region (and hence never return there 97% of the timeframe). Edit: I know some of you will nitpick at the other possibilities. But try and get the message that if you knew IN ADVANCE that a region wasn't going to be returned to... if price goes through it, near it, around it, under it or over it.... trade AWAY from the zone. Trade away...
Nice explanation and the only problem is finding h value for each timeframe.
Pivot Boss in the making~
  • #6,071
  • Aug 18, 2014 1:09pm Aug 18, 2014 1:09pm
Quoting vlady1974
{quote} These are the 2 basic outcomes. There are more... but basically, you don't put a pending order in the transient unless you have a technique or an edge that guarantees that price will go through the transient region (and hence never return there 97% of the timeframe). Edit: I know some of you will nitpick at the other possibilities. But try and get the message that if you knew IN ADVANCE that a region wasn't going to be returned to... if price goes through it, near it, around it, under it or over it.... trade AWAY from the zone. Trade away...
People can compare your picture with Eurusd's which he posted earlier. http://www.forexfactory.com/attachment.php?attachmentid=1492041&d=1408372565
Also, solid advice. An extension to normal trading.
  • #6,072
  • Aug 18, 2014 1:14pm Aug 18, 2014 1:14pm
Quoting jurn_e
{quote} Nice explanation and the only problem is finding h value for each timeframe.
Hi, please check post #5916 for the first version of the indicator which should help with this.
  • #6,073
  • Aug 18, 2014 1:41pm Aug 18, 2014 1:41pm
Quoting stt
{quote} i just want to comment that for a true fair coin, prob of H after 6H in a row is still 1/2 and not any lower. Since the toss are independant, first 6 H dont affect prob of next toss. you can also see it like this - after 6 H, there are two possibilities, next is tail or head. prob of 6H in a row is (1/2)^6 prob of 6H in a row and then next one T is (1/2)^6 * 1/2 = (1/2)^7 prob of 6H in a row and then next one H is (1/2)^6 * 1/2 = (1/2)^7 so you see that prob of 7th toss coming up T is same as prob of 7th toss coming up H. So even though...

Seriously, I really don't think anyone here thinks that after 6 tosses, you have a better advantage of tail coming up! what we are saying is : if you tossed the coin and got 6 heads and I asked you to bet on what the next 6 outcomes will be? It is safer to expect at least one tail in the next 6 outcomes because that probability is 1-(.5)^6 which is about 98%. Therefore we can bet on not experiencing the rare event HHHHHH again immediately after one.
  • #6,074
  • Aug 18, 2014 1:54pm Aug 18, 2014 1:54pm
Quoting handy148
Re coin toss I seem to remember reading somewhere recently that a Las Vegas Casino reported that red came up 41 times in a row.
I'd have to bet on black.
  • #6,075
  • Aug 18, 2014 1:58pm Aug 18, 2014 1:58pm
  •  Neio
  • Joined Oct 2012 | Status: Can't think outside?Enlarge the box | 688 Posts
Quoting Eurusdd
{quote} On average the height of a transient zone is less than 10% of the window size or the price-active region. That is left to you to figure out!!! I will not go into optimal values!!! 97% of the time, the current price going forward wants to be h-recurrent for some h!!! So, there lies you key to $$$.

Still trying to figure this part out.

What is the price-active region?

I still have a target of of 1.3372 for the underside of a currently transcient zone which will probably close in the next 30 minutes (CORRECTION another hour) based on my h bar setting for 15m tf. I feel that the current zone is too high and price needs to cut back into it a bit more.

I guess we will find out in the next 30 minutes or so... CORRECTION I have about another HOUR
An expert is a man who has made all the mistakes which can be made
  • #6,076
  • Edited 2:24pm Aug 18, 2014 2:08pm | Edited 2:24pm
Quoting Eurusdd
{quote} Seriously, I really don't think anyone here thinks that after 6 tosses, you have a better advantage of tail coming up! what we are saying is : if you tossed the coin and got 6 heads and I asked you to bet on what the next 6 outcomes will be? It is safer to expect at least one tail in the next 6 outcomes because that probability is 1-(.5)^6 which is about 98%. Therefore we can bet on not experiencing the rare event HHHHHH again immediately after one.
98% is correct if we consider the tosses one set. In a set of 7 tosses what is the outcome of all 7 tosses are H? The probability is definitely pretty small. This applies to any other sequences, for example what is the probability of TT in a sequence of HHTTHH? Pretty small. Even in perfect sequence like HTHTHT the probability that the next outcome is H is quite small if you consider it a SET.
However, if we consider each outcome as independent, then even after 47 H the probability of another H is 50%, nothing more, nothing less.
This is just my high school math knowledge. I might be wrong.
anyway, this is was little off topic
As Above, So Below
  • #6,077
  • Aug 18, 2014 2:12pm Aug 18, 2014 2:12pm
First i would like to say than im am a huge fan of what you are doing on this thread EURUSDD. It is amazing that people like you are sharing their knowlegde and know how. Im a huge fan!

Secondly i would like to ask if anyone in this thread has managed to get the proper indicators for Mac? I'm having trouble getting the right indicators.

Thank you!
Not about how much you win, but how much you loose
  • #6,078
  • Aug 18, 2014 2:50pm Aug 18, 2014 2:50pm
Quoting tashkent
{quote} 98% is correct if we consider the tosses one set. In a set of 7 tosses what is the outcome of all 7 tosses are H? The probability is definitely pretty small. This applies to any other sequences, for example what is the probability of TT in a sequence of HHTTHH? Pretty small. Even in perfect sequence like HTHTHT the probability that the next outcome is H is quite small if you consider it a SET. However, if we consider each outcome as independent, then even after 47 H the probability of another H is 50%, nothing more, nothing less. This is...

Hey: did you get the message? No one is interested in a single toss. We are interested in rare evenets and so how can a single toss be rare? I am talking about getting 6 Hs again after we got one the last time. lol.

I am talking about getting HHHHHH again after the last 6 tosses ended up as HHHHHH. HHHHHH is a rare event here and we can safely bet that the next 6 tosses will have at least one T. That is a safer bet!!!
  • #6,079
  • Aug 18, 2014 2:54pm Aug 18, 2014 2:54pm
Quoting stt
{quote} i just want to comment that for a true fair coin, prob of H after 6H in a row is still 1/2 and not any lower. Since the toss are independant, first 6 H dont affect prob of next toss. you can also see it like this - after 6 H, there are two possibilities, next is tail or head. prob of 6H in a row is (1/2)^6 prob of 6H in a row and then next one T is (1/2)^6 * 1/2 = (1/2)^7 prob of 6H in a row and then next one H is (1/2)^6 * 1/2 = (1/2)^7 so you see that prob of 7th toss coming up T is same as prob of 7th toss coming up H. So even though...
Yes but the coin tossing has no memory and price has. There is no relationship between 2 consecutive tosses of the coin. Maybe that is the case? And also, we dont look at a coin toss that is random in time, but rather in a chain of 6 consecutive events. So probability of the same tial gets lower with every turn.
  • #6,080
  • Aug 18, 2014 2:56pm Aug 18, 2014 2:56pm
Quoting swamper
{quote} I'd have to bet on black.
This is not the message in my post. I am not concerned about a single toss.
My point is this. 41 red is a rare event. Now which is a better bet?
1: The next 41 colours will be red

2: at least one of the next 41 colours will be black.

That is what I meant. We should not expect the rare event "41 reds" to occur again just after it occurred.
8 traders viewing now