Funny Looking Rectangles & Useless Drivel

[quote=iDoubleStoch;7763468]{quote} Hey, PM.

thank you so much--most of what you say is way over my head ,but as little as I do know - i know who does know

***YOU*** you're the best

I think women should make better traders than men. Men are more apt to hold on to a loser because it somehow jeopardises their manhood to "cut it off." Women will take the loss, cry about it, wash their hair and let it go.
I am trying to get my daughters interested but they couldn't care less about this awesome game- even though one of them is an X-Box fiend. It's weird.



Addo: My biggest problem has historically been not being able to let go of a losing trade. I would just take it and take it and take it, knowing full well that "it's coming back." It ain't coming back. It seems if I hadn't been married for so long, I would be a stalker in another life. :/

So has my intuition proved wrong (again...)?



A few questions about it, if you don't mind...

 

1. Would this move, supposing you got in when I posted the initial pic, have triggered your mental stop-loss and would you have killed the trade?
2. You say that there are Fall Lines above and below current price. I completely understand the dichotomy of markets in that there can be two equally valid arguments for making a move short or long. In that case, do you go to the fundamentals? Today, fundies are also two-faced as to possible direction; push-me, pull-you. When do you consider fundamentals in deciding a direction, if at all?
3. You mentioned that some market structures are "inverted." I don't recall having seen a discussion on this thread about right-side-up vs. upside-down. Can you elaborate?
4. Also, you mentioned the lengths versus the angles of the first legs of the Bento Box. can you explain more of that, as well?

IDoubleStoch, somewhere you mentioned that your system is behaving bad these days.
May I ask why is that so?

1.Is it because of (too) much directional movements in the last few months across markets?
2.Edge evaporation?

Or is it due to something else?
Thanks!

Ok, Orly. We now come back to your original question which was:

http://i58.tinypic.com/ogcu1h.jpg

If you take a look at the large D5 Inverse B2i on this GBPUSD deal, you will not that almost immediately after price exited the box for the very first time, price behaved as if it had just fallen off the edge of the earth away from the D5 Inverse B2i Fall Line, just as it is supposed to do according to this pattern's history. The problem with that move down is that the current D1 Inverse B2i was sitting underneath it and it got crushed. A 5:1 structural weight advantage broke the back of the upside move in the smaller D1 Inverse B2i.

When you add the overall B2i environment by summing the Fall Lines take from the current 1 Year, 2 Year and previous 1 Year B2i structures that I posted yesterday, all this downside tendency in price starts to make sense and it shows the importance of having the best Timing, Direction, Magnitude and Probability that you can have in the smaller time frame trades.

Notice the chart. The Real Price regions in three of the last four (4) days have not been seen yet. That confirms the Annual B2i environment to the downside.

Lastly, the trade that I entered about 75 too late as posted several days ago, went on to make a net positive 50+ pips. I did not exit there because that D1 B2i Fall Line target was sitting 130 pips away from the optimal Early Warning Entry Window. The lesson here is that you want to maximize all four: Timing, Direction, Magnitude and Probability. The Timing and Magnitude were off for an entry that was 75 pips late. That's important to remember. The distance from the Early Entry Window to the D1 B2i Fall Line of 9/19/2014, was 130 pips in the absolute. My entry was 75 pips late, so that left 55 pips remaining. If you look at my "proof" pic showing the actual trade balance detail, it was right near $500.00 net profit. So, even with bad Timing, it still made about 50 pips.

There are two lessons here from this failure:

1) It does not matter what kind of trade entry trigger or trade signal you use, if there is not sufficient Magnitude, target levels may be difficult to reach. It this case, it fall short by 5 pips after a 50+ pip run off the late entry and at the end of a very nice 125 pip move from 9/22 to 9/23. Think of Magnitude as Fuel Quantity. The Boeing 747-400ER has a range of 7,600+ nautical miles. But, if you fuel the aircraft with 100,000lbs of Jet-A, you'll never see anywhere near the full range potential of the aircraft. This is where the Early Entry Window helps to maximize the fuel load, or catch Magnitude near its maximum potential.

2) A target based trade should either be monitored in real-time, or if left alone, sufficient reserve should be introduced into the target to bring it under the maximum potential of the reference Magnitude. Therefore, the D1 B2i is a structure that covers a fixed 24 hour period. That is one Daily Bar of Data. Thus, to optimize such a trade you would want to know the Daily Bar Magnitudes. You'd then use the known Mags to adjust the potential exit point on the way to the Fall Line (not the Fall Line itself - leave that alone). This is a rudimentary way of establishing Adjustable Targets. The B2i Structure is one thing. The Magnitude in the bars of data used to plot the B2i structure is another. Magnitudes could be weakening while a B2i structure is printing itself. That relationship should be dealt with by adjusting the target exit level to be within the limits of Magnitude plus some reserve amount.

Had I not been 75 pips late on the entry, done my homework on the larger B2i structures in which the smaller structures must evolve and reduced the target using a reserve amount obtained from the Magnitude, that 5 pip miss which has not turned into a a whopping -114 draw, would never have seen the light of day and I walk away with a net positive trade back on 9/23/2014, instead of sitting on a loser three full days later on 9/26/2014.

Timing
Direction
Magnitude
Probability

If you are trading without paying some serious homage to this factors, ignoring them can wreak havoc on your consistency and make life as a Trader fairly miserable.

Most of these have been successful, but you don't learn nearly as much from successes in trading as you do from failures. Learn from the mistake I made.

Proof of failure:
http://i58.tinypic.com/i21yqd.jpg

Yet, another good example of why I use an automated trading system. The more inputs used in making the decision, the harder it is to remain on top of everything you need to make optimized decisions. If you are trading manually, you want to make sure you cover all the bases that relate to your method or tactic, so you don't get caught with your pants down.

The ancient phallic theory for why men can cut it loose. I've never thought of it that way but you might be on to something.

I've been around a few Traders who are women and they do seem to handle losses quite better than men. Although, if you watch Million Dollar Traders, you will note that while Caroline, turned out to demonstrate the most emotional stability under fire, it was in fact Cleo, who not only demonstrated the least amount of emotional stability, but clearly was a disruptive factor to the remainder of the team, second only to Emile (male candidate) who had absolutely no business being selected in the first place.


The way I taught people to combat that kind of indecision is by using a system for trading with specific parameters and not doing it manually -or- combining an automated signal delivery system with highly evolved manual overrides for actual execution.

I always taught people to lean heavily on developing good Timing, Direction, Magnitude and Probability into their system, and then accept any deviation from that as being outside the parameters of acceptability - thus, making the cut-off point much easier to digest. Post Failure Analysis (PFA) was also taught to look for outlier causation and internal system failures (bad logic). If nothing could be found after PFA, then the loss must be recorded by the system as normal.

I've never met a 100% accurate system that lasts forever. But, you can make decent money on just 57%, become financially independent on 63%, become wealthy on 71% and grow capital at will on 83%. Above 91% accuracy to a specified target, you don't even worry about the losses anymore.

"The ancient phallic theory for why men can cut it loose. I've never thought of it that way but you might be on to something. "

Could be part of it. The real deal is less basal, I think, and it has to do with the hunter-gatherer, "provider" aspect of the male psyche. Men must not fail to bring home the rabbit. First, it would lessen his prestige and apparent usefulness to the family and home. Second, mama would not be happy if that pattern continued. And we all know what happens if mam's not happy. Talk about lessen your self-worth as a man!

As a (hopefully...) interesting aside, has anyone noticed that when men go to the market, like to the store, they walk somewhat taller? And women try to look as sexually appealing as possible? I mean, men tuck in their shirts and suck in the gut, while women are wearing tight lycra workout pants or a low-cut shirt. Always black ones, for some reason...

I think that is actually the same phenomenon at work. The men at the store are the "providers" getting the milk, while the women are preened to appeal to the most able men. Next time you're in the Albertson's, especially on a busy Saturday or Sunday morning, take notice.
It's all true.


P.S. i do hope none of this offends...

Not quite, yet. You'll want to go back and re-check some of the posts that deal with the Inverse B2i and how it works. To help you understand in this post, just follow along here.


The D5 Inverse B2i was 5 times long in duration than the current D1 Inverse B2i, and 2.0 times bigger in potential target size:
http://i62.tinypic.com/2uf3vk7.jpg

That means the D5 Inverse B2i was bigger than the current D1 Inverse B2i in Time and distance between optimal entry point and Fall Line. Four Real Price regions in decline also provide clues as seen on the chart. The chart shows the H1 OS1, not the M1 OS1. That means the same price behavior you see when the M1 OS1 crossings take place, will be slowed down 60 times relative to that seen in the M1 OS1 crossings and the movements (volatility) during the crossing will be much bigger than on the M1 OS1.

So, the behavior of price near the H1 OS1 has to be considered pre-crossing behavior because of OS1's condition being Flat this time. However, its directional bias must still be considered down as long as Red remains over Green. This is the distinction between Market Phases. Different components of the market will behave in different ways during a transition and depending on the time frame you are observing, that transition will either be fast (like when observing on the M1 chart) or slow (like when observing on the H1 chart). That size of the moves will vary with time frame as well.

You posted D4 Inverse B2i yesterday with its intersection extending out to 5 Days. If you look closely, you will see that the current D1 Inverse B2i was overlapping the D4 Inverse B2i. In the smaller current D1 Inverse B2i, price was being repelled away (UP) from its Fall Line, just like it should until price reached the D1 Inverse B2i Intersection Time. Immediately, after clearing its own Intersection, it was no longer under the influence contained within the Magnitude of the D1 Inverse B2i, where price then began to move back under the influence of the Magnitude within the D4 Inverse B2i which was repelling price away (DOWN) from its Fall Line.

Doing so, actually extended and created a new D5 B2i Structure with an upside Fall Line:
http://i59.tinypic.com/ru8ent.jpg

This injects an upside probability back into the market from this price level, if the current D5 B2i Structure does not establish a new Extreme which would simply reset its structure and shift its Fall Line.

Lastly, notice the differential in the D4 Inverse B2i and current (brand new) D5 B2i Fall Lines. What makes a B2i "Inverse" is the lack of angle between its resultant Fall Line and the Projection Line furthest away real-time price. Also, keep in mind that even though a new D5 B2i has emerged, it spans five (5) days. That means that movement to its Fall Line could take at least five (5) days. It does to have to take that long, but history shows that the slope of the structure's Projection Lines and the time span of the structure, plays an important role in when price reaches the target in most cases.

And that is what is meant by an Inside Strike, if price reaches the Fall Line before the time period extension and inside the Bento Box?
An Inside Strike would give greater credence to the probability that price will continue to move well above/below the Fall Line?

@Relativity...

I have noticed that vacuum phenomenon you talked about around Weekly gaps. Often, when price returns to cover the gap, it will do so with strong and long candles. It's like the market just whooshes past the gap, leaving no support or resistance in that area. Quite often, price returns to fill in those long candled areas with a consolidation period right where the market flew over beforehand.
Have you found that, too?

And, to help you better see this Orly, I've de-cluttered the chart and added the current D4 Inverse B2i Projected Intersection Time and the current D5 B2i Projected Intersection Time, so you can see both relative to where price is right now.

I talked about price "clearing the B2i Projection Intersection" and I referred to what was then the current D1 Inverse B2i with its initial upward repelling tendency. That is especially important in this case, except that since price has already cleared the repelling influence in the current D1 Inverse B2i, focus now shifts to the D4 Inverse Projection Intersection Time and eventually, as price move forward in time, the current Standard D5 B2i Projection Intersection Time. The D1 Inverse B2i Fall Line predicts downward influence and the current Standard D5 B2i Fall Line predicts upward influence. But, as usual, Timing will be key in such a volatile B2i environment.

At the end of this session today, price will be clear of the D4 Inverse Projection Intersection Time. It has already repelled price downward today as it should have. As price moves forward in time, the current Standard D5 B2i Fall Line and its Projected Intersection Time predicts to have greater influence.

http://i59.tinypic.com/22fj7r.jpg

Of course, all of that must be kept in context relative to what's happening in the really big time frames like the Annuals:
http://i60.tinypic.com/30jifcw.jpg

Updated Annual Chart GBPUSD.

Does Real Price ever "expire"?

I don't think I've used the word "bad" to describe my trading system in many years. I might have referred to its "Health." It has a systemic health monitor that checks all the vitals of the system and basically maintains a real-time report card on the overall status of the system relative to accuracy to a specified target. I might have made reference to the slower equity growth seen this year as opposed to recent years, but I seriously doubt I ever referred to it as being "bad" per se.

Poor performance is going to be relative and subjective for each trader. The system has not seen a sub-90% accuracy rating in quite some time. So, anything below 90%, I would consider "bad" but that same sub-90 performance might also be someone's "good" performance. It really all depends on what the Trader as become accustomed to seeing from their system on a routine basis.

Fortunately, because my trading technology is not based on conventional TA, and the trade logic is good, I experience no severe reduction in the system's edge. What I do get from time to time, is slower than usual pick-up in Magnitude shifts in the market and that causes targeting problem and results in smaller profits and an increase in more BE trades. Those things slow down equity growth and reduce overall accuracy ratings, forcing the system to report lower health levels such as running at 89%, 88%, 87%, as opposed to running at a customary 91%-93%. As Magnitudes come back, system performance is restored and accuracy levels rise to normal levels. All take slower equity growth periods over huge performance drops any day.

You will notice Magnitudes shifting from one set of major pairs to another, as the market simply shifts its cost basis into other currencies over time. This is normal and it is why you see High/Low range shifts in JPY, as one example, while the main European pairs have come back to life. Causes vary - in the U.K. it was all Polinomics (Politics and Economics colliding). Eight years ago, pundits were predicting the collapse of the EURO. Remember that nonsense? They were saying the EUR dollar was going away for ever - simply would not survive the global meltdown. The predicted the EU would explode into a million little pieces and a suppressed economy for the remainder of all life on earth. In short, the pundits told you to pack up and get the heck out of the UK. They were wrong - as usual.

In Japan, the currency issues will mostly be Fiscal related. Their Monetary Policy is driven by still challenged economic realities that are not yet settled. So, the Magnitudes in some of the major JPY crosses got compressed, but the directional nature of the JPY has been known for quite some time, as the market simply shorted the JPY relentlessly. Now, the pundits are talking about an oversold Yen and how this will hurt the Japanese economy long term. Whether the Yen, is over or under sold is simply not my concern. When Magnitudes increase, is really what I care about. Right, now, I'm shifting back over to the Euro based pairs as the Mags look a bit better.

I move between Europe and Japan all the time when the Mags dictate such moves are necessary. Maybe I was slower to move back to Europe this time, causing some misfires on targets this year. That's a strategy/management problem, not a system problem. Very hard to be perfect all the time - or at any time for prolonged periods. But, being able to consistently BE during times of Magnitude drops is a testament to the systems ability to effectively produce the other important factors such as Timing, Direction and Probability.

My research shows that RPs seem to be less relevant at: Projected Intersection Time + B2i Time Frame. Thus, RPr ~ PIT+B2iTF. The Relevance (r) of RP is diminished as price moves beyond PIT. At PIT 10:00, B2i Time Frame 4 hrs and price at 9:00, RP is at maximum relevance. At PIT 10:00, B2i Time Frame 4 hrs and price at 14:00, RP relevance has reached minimums. Any move back to RP after that is not something that I've studied and would fall outside the domain of the B2i concept. There might be some other relevant factor involved, but I have not made such a connection of discovery through research.

The bigger the B2i Time Frame (the more it spans across time) the longer the duration of RPr.

So Real Prices after the PIT are like old actresses ...they're just Faye Dunaway.

Ha! (Sorry couldn't resist!)
Happy Friday, everybody. See y'all on the other side.

LiquidGenius and I checked about weekend gaps;
https://lgtrades.wordpress.com/2014/...e-weekend-gap/

Ok. I was in a bit of a hurry, maybe asking things ''cart before the horse''. :-)
From reading of your posts, it probably should have been clear, that your edge is obviously just not so easily destructible.

No bad intentions from my side...
Still, I always wonder, always in fear when edges are in concern, don't you?

Anyhow, thanks for the neat explanations...
L

Which is why people should go through the work of discovering who they are as Traders, I think - male or female. That way, nobody and no circumstance will be able to define you for yourself because the knowledge of true self will be readily apparent. When a Trader feels loss and is then driven by it, they are not yet ready. Only when the Trader can experience the loss, not be altered in decision by the experience and continue on the path they've set for themselves, can they truly be considered "ready" for Trading and for taking their experience to the next level of success. I think this has everything to do with the dominant beliefs about "money" and how people relate and associate money with human potential and/or capacity. So, when they lose money, they "feel" as though they are losing a part of their humanity - when nothing could be further from the truth.

In terms of the impact that emotions have on trade decisions, too many people trade the markets based on how they feel, instead of predicated upon the historicity of the market itself. The Trader's Psychology that enables the Trader to not forsake their feelings while at the same time recognize that Emotion is not equivalent to Intellect, is the kind of Psychology and Philosophy that leads to a more successful Trader overall. This is why I used to stress in my proteges, the need to understand that neither their success or failure is who they are either as a person or as a Trader.

That keeps them grounded when profits roll in and when capital rolls out, until they reach a point where they have no state change when ether takes place and they simply perform the functions of running trading as the business that it is on a daily basis. Those Traders are typically the kind who actually grow capital over time, instead of losing it long term. The empirically based Trader will always have that advantage - male or female.

It is difficult for most people to separate Emotion from Money. To a lot of people, these things are equivalents, but they never think about it in that way. Steal money from them and the Emotion rages negatively. Flood them with money from out of nowhere and the Emotion rages positively. A good solid Trader must learn to not cut the string to Emotion, but to Transform their thoughts and beliefs about Money, literally.

When the Trader can generate money at will and on-demand, that is when they start having different "feelings" about what money means to them. But, when a Trader finally learns how to grow capital consistently, that is when the Trader evolves their previous limiting believes about what money means to them and that is when the real transformation is complete. However, that transformative process first begins with literally re-wiring your brain and the currently well established thought patterns it has with respect to money - and that process is enabled through consistency in trading results along with some serious work on developing a new emotional response to lose of capital.

No, this does not offend because it is the most important thing that any Trader will have to face, before they ever reach the stage of true long term consistency. It is quite safe to assume that, if a Trader has not yet broached this subject with themselves and reshaped their physiological response to trading in general, then they are most likely not long term successful Traders, yet. It is the last great frontier that the Trader has to master, before stepping into the world of long range consistency.

You can't kill Emotions, but you can alter the mind's response to perceived failure and thereby change the physiological state in which future decisions are made about what to do next - which in itself alters the trading results and that becomes the psychological platform upon which long term consistency is made possible. That Trader that does not really understand this is not really ready, because sooner or later, their improperly channeled Emotions will catch up to them.

Losing $300 in a $3,000 account, has to register in the mind no different than making $3,000,000 in a $30,000,000 account. Likewise, losing $3,000,000 in a $30,000,000 account, has to register in the mind no different than making $300 in a $3,000 account. Those two net results must be equally understood by the mind as exactly having the same Emotional charge - Neutral. That requires a re-mapping of the brain relative to "Money."

In my mind, money is nothing more than a tool to make more money. I don't look at money as an object to be desired, but as a tool to be used and manipulated to meet my needs. Money does not control me, I control money. I master it - it does not master me. I have power over money - money does not have power over me. I am the Master and money is the Slave. I dictate ever aspect of money and it is not allowed to dictate anything to me. Money does not equal me and I do not equal money. Money is merely my servant and I control its destiny. Money meets my needs. Money has no needs of its own. I am responsible for my use of money, for I am its Commander in Chief. Money does not give me power. I am powerful without money. Money enables options that I may, or may not chose to take advantage of in my life. That's all money is good for. Money is not human, nor should it ever be considered as such.

With that belief system well evolved inside my brain, I am free to Trade the world, without fear, without consternation, without regret and without conflict. A trade is just a trade. The money gained or lost is merely and outcome of a decision I made and has absolutely nothing to do with my self-worth, my position in life or my future potential.

If I truly believe that and live that way, then I the process of growing capital at will is enable.

Not quite. Faye Dunaway, Raquel Welch, Jayne Mansfield, Elizabeth Taylor, Dorothy Dandridge, Audrey Hepburn, Sophia Loren, Dianna Ross, Hazel Scott, Lena Horne (not sure how anybody could look that damn good). These Women were all extraordinarily unique and attractive way after their "prime."

Unlike the PIT:
http://fashionbombdaily.com/wp-conte...na-horne-1.jpg

That will never get "old."