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The similarity system

  • #7,501
  • Sep 5, 2014 8:55am Sep 5, 2014 8:55am
Quoting hannele
{quote} up cheers hannele
I really don't need to buy any EURO at the moment. Happy to sell it once signal is presented.
If you fall, I shall be there. - The floor
  • #7,502
  • Sep 5, 2014 9:20am Sep 5, 2014 9:20am
Quoting jimsterk
I am not sure if I grasp things correctly. I still do not understand 97%-3%. This is just a quick calculation. {image} Therefore, if we assume proposition 1 is true, then it implies (at least) one possible trading strategy. {image} This reminds me 3-plan. Note that (h,k) is randomly chosen; not optimal I think. It is obvious that (h,k) is related to the number of trade and the ratio of successful trade. We must chose (h,k) optimally, so that we maximise the number of trade and the ratio of successful trade. Thank you.
Can you explain a little more about these signals.
(h, k) random?
thank you very much
  • #7,503
  • Sep 5, 2014 10:19am Sep 5, 2014 10:19am
Coming up to London closing time, the NFP was a bit of pickle to navigate. I must have scalped 15-20 pips and left 20 on the table before finally settling on a short at 2967 with a stop at BE. It's been a bit crazy so I don't mind now if it gets hit.

==============

In terms of h, we know it's the number of discrete time bars on either side of the central bar being evaluated.
K is projected to be a value that affects price. From the notes, it would seem that the right size of h will reflect a small size in k. The end result of both h and k is to have a thin Transient Zone not a THICK one.

The initial programming of this resulted in an indicator that displays at Tops and Bottoms. The real value to me is the levels of price WITHIN a bar, that is transient at h. And also that the left hand side of a developing transient zone is different in behaviour to the right hand side.
A pip is only worth it if you know how much you risked to earn it
  • #7,504
  • Edited 10:37am Sep 5, 2014 10:19am | Edited 10:37am
Quoting vlady1974
{quote} But as LITEChild mentioned yesterday, how do you switch from your mental bias to the opposite direction? Whilst it would appear that we need a corrective move (I know this via Elliot Wave) how would we know? Shouldn't we just follow the trend?
It gets to a point where you have to decide whether to FOLLOW price, or PRE-EMPT IT. The former implies trading breakouts in one form or the other. The latter implies you try to catch tops and bottoms. Which then natuarally begs the question, which one is better??? If there is a high probability of price going up (or down) at any given point in time, do I just jump in confidently(at A), or wait for it to actually move in the expected direction first before commitiing to an entry(at B)? That's the CROSSROADS of critical price levels I talked about earlier. In my opinion, it doesn't matter!!! IF you can CORRECTLY identify those critical levels at A and B, THEN even if buy entries fail above A and B(which is subjective depending on your EXITS), sell entries at or below B, will most probably not. Statistically you should have determined that price will with high probability NOT RANGE between A and B! That is what I thought EURUSDD meant by not getting three losses in a row. Three losses in a row would imply you are stuck in a RANGING market and your identification of A and B was wrong and those levels are not CRITICAL afterall!
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  • #7,505
  • Sep 5, 2014 10:24am Sep 5, 2014 10:24am
Quoting vlady1974
{quote} Excellent post. I would recommend reading......
Vlady, thank you for your post. Well, I think my main problem has always been my romantic attitude towards trading. I have always been a dreamer, never scientific, never too rational, believed in the trading wonders and always wanted to replicate them. Maybe that is the reason why I still haven't reached my goals. I always think mostly about potential rewards, and not about the risk and how to avoid losing. I concentrate on winning, it took me about 4-5 years to finally become able to turn some green pips, but I always suffer some major disaster after a good series of success, which almost erases what I have done, so I don't have the consistency that I actually need. And then came EURUSDD with another fairytale, but this time much more possible and it gave me new hope to become better, and I really did, my performance has increased drastically, however I still suffer major losses that puth me off my track, I suffered such loss right in the last 2 weeks TWICE. After a good streak of wins, and now I am low on hope.. again. I fell like a rather experienced gambler, I win some, lose some, know many aspects of the game, but still I play rounds and sometimes the inevitable strikes out of nowhere and I am back one level down... Good that I play small accounts and never really relied on trading for anything.. But I want to go forward, I really believe that the true success, the one that I always aimed for is right around the corner, and is closer than before. I see experienced traders like you and few other people here, you have serious understanding and it seems that you have put eurusdds concepts into good frame, you have some tuned methods/strategies in your aresenal. Something i DON'T have yet... I will definately read the book when I have some time, probably over the weekends. Looking forward to more posts.. I really enjoy when you guys add visual examples with screenshots and synthesize your thoughts over the proccess.. I have learned A LOT from the beginning of that thread up until now
  • #7,506
  • Sep 5, 2014 10:39am Sep 5, 2014 10:39am
Quoting jimsterk
I am not sure if I grasp things correctly. I still do not understand 97%-3%. This is just a quick calculation. {image} Therefore, if we assume proposition 1 is true, then it implies (at least) one possible trading strategy. {image} This reminds me 3-plan. Note that (h,k) is randomly chosen; not optimal I think. It is obvious that (h,k) is related to the number of trade and the ratio of successful trade. We must chose (h,k) optimally, so that we maximise the number of trade and the ratio of successful trade. Thank you.
Nice picture jimsterk. Do you mean after we put some orders, then we must change the h & k value ?
Or do you mean something else ?
  • #7,507
  • Sep 5, 2014 10:42am Sep 5, 2014 10:42am
Quoting LITEchild
{quote} It gets to a point where you have to decide whether to FOLLOW price, or PRE-EMPT IT. The former implies trading breakouts in one form or the other. The latter implies you try to catch tops and bottoms. Which then natuarally begs the question, which one is better??? If there is a high probability of price going up (or down) at any given point in time, do I just jump in confidently(at A), or wait for it to actually move in the expected direction first before commitiing to an entry(at B)? That's the CROSSROADS of critical price levels I talked...
I like your last image Litechild, i remember something some where, for long term trading ....
  • #7,508
  • Sep 5, 2014 10:49am Sep 5, 2014 10:49am
Quoting feline207
{quote} Vlady, thank you for your post. Well, I think my main problem has always been my romantic attitude towards trading. I have always been a dreamer, never scientific, never too rational, believed in the trading wonders and always wanted to replicate them. Maybe that is the reason why I still haven't reached my goals. I always think mostly about potential rewards, and not about the risk and how to avoid losing. I concentrate on winning, it took me about 4-5 years to finally become able to turn some green pips, but I always suffer some major...
Hang in there! Your experience is valuable - only you know you and that is the only trader that matters!

I feel for your experience because we've all been there. So yes, great idea to read the book I mentioned. Then let's start with the basics.

1) What is the strategy or edge that has given you green pips?
2) In your most recent losses, what was your entry and where did you cut your loss?

Answer these in the thread and let's see if we can't help put you on a good philosophical path. This is better than just giving you strategies or tactics - we can leave that to you. But if we are able to distill some solid trading ideas or philosophy, then you may just have your Eureka moment.

===========

It doesn't matter what new edge comes across your path. The edge is nothing without your interpretation of it.... so hence why we get a million answers using the same Fibonacci indicator. LOL.

As LITEChild has highlighted.... the true "art" of a trader is to think in terms of possibilities. This is what legendary Cloggie taught me:

IF..... THEN.....ELSE

3 words that create a trading plan. You do this enough times you start to not have to say it.... the prices/levels just come to you.
But the trick is not the analysis of the numbers.... it's knowing that you have a plan or an approach.
The beauty of the plan is that you don't ever have to be right or wrong - thus removing emotion from the equation.

If price HITS 1.2950 AND closes below it on the 5M timeframe I will short from 1.2948 targeting 1.2848 with 15 pip SL.
Otherwise
If price HITS 1.2950 AND closes above it I will wait for a retrace to 1.2960 and enter a long at that price with SL at 1.2950 targetubg 1.3050
Otherwise
If price HITS 1.2950 but does not clear either 1.2960 or 1.2940 in the following 1H I will close any trades if they are open or I will not trade if I am flat.

Now this is simple enough.... but I can tell you it wasn't until Cloggie did this in a play by play post on FF during a live session that I saw how he did it. And he never had to be right. Because he had each direction covered.

The discussion LITEChild is providing now is worth thinking about..... it's where we can add the tools Eurusdd has provided. Ranging vs Trending. Transient vs Recurrent.... Similiarity vs Dissimilarity. There are really ever only 3 states: up, down, sideways. And that's what the IF THEN ELSE thinking helps you to do.

Have a great weekend!
A pip is only worth it if you know how much you risked to earn it
  • #7,509
  • Sep 5, 2014 10:58am Sep 5, 2014 10:58am
Quoting feline207
{quote} Vlady, thank you for your post. Well, I think my main problem has always been my romantic attitude towards trading. I have always been a dreamer, never scientific, never too rational, believed in the trading wonders and always wanted to replicate them. Maybe that is the reason why I still haven't reached my goals. I always think mostly about potential rewards, and not about the risk and how to avoid losing. I concentrate on winning, it took me about 4-5 years to finally become able to turn some green pips, but I always suffer some major...

MORE SANCTIONS ON RUSSIA are being finalized as I type now.
If you fall, I shall be there. - The floor
  • #7,510
  • Sep 5, 2014 11:01am Sep 5, 2014 11:01am
Quoting vlady1974
{quote} Hang in there! Your experience is valuable - only you know you and that is the only trader that matters! I feel for your experience because we've all been there. So yes, great idea to read the book I mentioned. Then let's start with the basics. 1) What is the strategy or edge that has given you green pips? 2) In your most recent losses, what was your entry and where did you cut your loss? Answer these in the thread and let's see if we can't help put you on a good philosophical path. This is better than just giving you strategies or tactics...

4H tell me Buy
1Hr tell me SELL
30M SELL
15 SELL

I am tired
If you fall, I shall be there. - The floor
  • #7,511
  • Sep 5, 2014 11:03am Sep 5, 2014 11:03am
Quoting vlady1974
{quote} Hang in there! Your experience is valuable - only you know you and that is the only trader that matters! I feel for your experience because we've all been there. So yes, great idea to read the book I mentioned. Then let's start with the basics. 1) What is the strategy or edge that has given you green pips? 2) In your most recent losses, what was your entry and where did you cut your loss? Answer these in the thread and let's see if we can't help put you on a good philosophical path. This is better than just giving you strategies or tactics...
Thanks Vlady, ou yes i Remember it, and will always remember it, it is a very good book. Although I have not read it until finish, but i find it is really great. Will read it again, Thanks for that.
This IF THEN ELSE is interesting ...... Have a nice weekend too
  • #7,512
  • Sep 5, 2014 11:04am Sep 5, 2014 11:04am
Quoting samaralala
{quote} 4H tell me Buy 1Hr tell me SELL 30M SELL 15 SELL I am tired
I think it is time for us to take a rest ..... See you on monday ...
  • #7,513
  • Sep 5, 2014 11:09am Sep 5, 2014 11:09am
Quoting samaralala
{quote} 4H tell me Buy 1Hr tell me SELL 30M SELL 15 SELL I am tired
LOL

4H vs the rest... let's see... based on QTY

One 4H (buy) = 4 x 1H and 8 x 30M and 16 x 15M (sell)

Sell wins!
A pip is only worth it if you know how much you risked to earn it
  • #7,514
  • Sep 5, 2014 11:23am Sep 5, 2014 11:23am
Quoting vlady1974
{quote} LOL 4H vs the rest... let's see... based on QTY One 4H (buy) = 4 x 1H and 8 x 30M and 16 x 15M (sell) Sell wins!

How do you manage full time job and this? Who lets you trade at work :-0
If you fall, I shall be there. - The floor
  • #7,515
  • Sep 5, 2014 11:24am Sep 5, 2014 11:24am
Quoting samaralala
{quote} How do you manage full time job and this? Who lets you trade at work :-0
Hehe... I wonder that sometimes myself. My objective is to get at least 3mths salary via trading and I am outta here!
A pip is only worth it if you know how much you risked to earn it
  • #7,516
  • Sep 5, 2014 11:28am Sep 5, 2014 11:28am
A wise man once said...
It is unfortunate that so many of us interprete mistakes as failure and suffer feelings of frustration and discouragement.
In actual fact, the mistakes we make are precisely the information that we need in order to make the necessary corrections that will take us to our goal!

A guided missile on it's way to a target has sensors that detect when it is off course.
The servo mechanism of it's Automatic Guidance System reaches it's goal by continually correcting mistakes.
This is done thousands of times on it's journey.
The guided missile relies on this negative feedback to 'guide' it on it's journey.
Without this negative feedback, the guided missile would never reach it's target.
This is also true for the human servo mechanism.
A servo mechanism should have no opinion one way or the other about mistakes.
It simply uses the information to guide it to it's objective.
What we call 'mistakes' are actually valuable lessons for success. (paraphrased)
  • #7,517
  • Sep 5, 2014 11:47am Sep 5, 2014 11:47am
http://digg.com/video/dressing-your-dog-up-like-a-massive-spider-is-one-way-to-scare-the-sh-t-out-of-people

Massive Spider
If you fall, I shall be there. - The floor
  • #7,518
  • Sep 5, 2014 12:00pm Sep 5, 2014 12:00pm
Quoting samaralala
{quote} 4H tell me Buy 1Hr tell me SELL 30M SELL 15 SELL I am tired
That is actually another of my closely guided secrets with respect to TIMING
When two consecutive timeframes agrees on a 'sell' or a 'buy', go the next lower timeframe, and trade the next signal in the direction of the 2 higher timeframes!
In your case, I would have taken that 15M sell. The joker is working out the right EXIT.
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  • #7,519
  • Sep 5, 2014 12:05pm Sep 5, 2014 12:05pm
Quoting vlady1974
{quote} he never had to be right. Because he had each direction covered.
\

shhhh!...that's the HOLY GRAIL!
  • #7,520
  • Sep 5, 2014 12:05pm Sep 5, 2014 12:05pm
Quoting vlady1974
{quote} Hang in there! Your experience is valuable - only you know you and that is the only trader that matters! I feel for your experience because we've all been there. So yes, great idea to read the book I mentioned. Then let's start with the basics. 1) What is the strategy or edge that has given you green pips? 2) In your most recent losses, what was your entry and where did you cut your loss? Answer these in the thread and let's see if we can't help put you on a good philosophical path. This is better than just giving you strategies or tactics...
so what are you doing now? Long/SHORT?
If you fall, I shall be there. - The floor
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