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Transient Zones - Basics

  • #101
  • Oct 22, 2014 7:14am Oct 22, 2014 7:14am
Quoting vlady1974
{quote}There are instances of TZs that will appear to have lesser significance than other TZs because the probability of the zone being cleared will depend on the time-value of your focus. Lower h will yield more zones - but not everyone is a tradeable opportunity, so this negates the view of looking at them as S/R. Higher values of h will yield less zones - so that's even less S/R areas on a chart..... but then are we still talking about S/R or are we talking about the probability that the axiom, prices are recurrent 97% of the time vs 3%. Yes,...
Thanks for explanations. I will take a look at them closely.

Edited. I have found that the "Middle of Bar" TZs are similar to the Hiddengap's zones.
Hunting High and Low
  • #102
  • Oct 22, 2014 7:16am Oct 22, 2014 7:16am
Quoting Dr.Phoenix
{quote} Thanks for explanations. I will take a look at them closely.


Here's a tip, Kprsa's indicator has statistics for the zones that may be of use.
In addition, his indicator doesn't draw boxes so the psychological cues of using them as S/R isn't there.
A pip is only worth it if you know how much you risked to earn it
  • #103
  • Edited 8:42am Oct 22, 2014 8:28am | Edited 8:42am
"Price is 97% recurrent, 3% transient"


I have a few suggestions, especially for anyone new. Remove ALL indicators. While I am amazed at all the coding, other ideas being sparked etc. the most important thing period in this thread is the quote I opened this post with.


Open a 15 min chart. Choose an H value of 6. Look at every bar for a few days back. See if you can draw a line or box (it becomes a box it price moves more than a pip in 'free' untouched space) from the current bar you are looking at back six bars without touching another bar. When you have done that, look to the right of the current bar / mid-bar. If looking at historical prices see how many times that line or box you drew was penetrated and fully cancelled out by price. Now watch as this happens in real time. This is ALL you need in my opinion to create a profitable edge. Again, it's so powerful and so simple:


"Price is 97% recurrent, 3% transient"
Attached Image (click to enlarge)
Click to Enlarge Name: TZ.jpg Size: 66 KB
  • #104
  • Oct 22, 2014 8:51am Oct 22, 2014 8:51am
Quoting SunSaltwater
"Price is 97% recurrent, 3% transient" I have a few suggestions, especially for anyone new. Remove ALL indicators.... This is ALL you need in my opinion to create a profitable edge. Again, it's so powerful and so simple: "Price is 97% recurrent, 3% transient" {image}
Like your diagrams very much. Very clear.
When in doubt, HEDGE
  • #105
  • Oct 22, 2014 8:54am Oct 22, 2014 8:54am
Quoting SunSaltwater
"Price is 97% recurrent, 3% transient" I have a few suggestions, especially for anyone new. Remove ALL indicators. While I am amazed at all the coding, other ideas being sparked etc. the most important thing period in this thread is the quote I opened this post with. Open a 15 min chart. Choose an H value of 6. Look at every bar for a few days back. See if you can draw a line or box (it becomes a box it price moves more than a pip in 'free' untouched space) from the current bar you are looking at back six bars without touching another bar. When...
I like your initiative. I saw your post in the Sim thread and thought, "someone has been inspired".
Good stuff! Keep going! Don't stop!

Now here's the challenge..... you've made reference to the major statistic 97 vs 3.
One of the traders to statistically verify this was LiquidGenius. I think he did it in Excel, can't remember.
But he verified against his data set how often a Transient area became Recurrent..... how could you do the same? (All the tools have been provided).
A pip is only worth it if you know how much you risked to earn it
  • #106
  • Oct 22, 2014 8:58am Oct 22, 2014 8:58am
  •  Owl
  • | Joined Dec 2012 | Status: FX Siphoner Of Symphonies | 435 Posts
wow this thread is a breath of fresh air and hope

for us all and all us fx traders around here..........
One Must Use A Noble Rapier To Pierce The Veil Of Mystery
  • #107
  • Oct 22, 2014 8:59am Oct 22, 2014 8:59am
@SunSaltwater: At the moment it seems that price is going to start to move to the recurrent area ...
This would then be a high probability trade to go short now?
  • #108
  • Oct 22, 2014 9:08am Oct 22, 2014 9:08am
Quoting hilavoku
@SunSaltwater: At the moment it seems that price is going to start to move to the recurrent area ... This would then be a high probability trade to go short now?
The black box is where price is still transient. We know that price doesn't like this. I would trade in the direction of the box (long) expecting that box to disappear and price to no longer be transient. Part of the box has already disappeared. It has shrunk. I booked 5.3 pips profit. Now could price keep moving down and never fill that box, or at least not for a while which is why you have to create a trading plan with stops etc. BUT, look back many bars and see how many times price is transient, so few times, it doesn't like it.

There are many, many ways to trade it. The first thing one must do is focus on the fact that price does not like being transient / not touched and when you can see this bar by bar you it will give you a new feel on price action.
  • #109
  • Oct 22, 2014 9:12am Oct 22, 2014 9:12am
Quoting vlady1974
{quote} I like your initiative. I saw your post in the Sim thread and thought, "someone has been inspired". Good stuff! Keep going! Don't stop! Now here's the challenge..... you've made reference to the major statistic 97 vs 3. One of the traders to statistically verify this was LiquidGenius. I think he did it in Excel, can't remember. But he verified against his data set how often a Transient area became Recurrent..... how could you do the same? (All the tools have been provided).
Hi Lady,

I have done some basic testing; however, I don't feel it's necessary. Just go back a few days on a 5 min, 15 min, whatever and look at price back n filling / removing transient zones all over the place. I like to keep things simple. I don't need an exact stat, etc. I will leave that up to you guys - I can see what's happening just watching bar by bar. I have zero indicators on my charts.
  • #110
  • Oct 22, 2014 9:20am Oct 22, 2014 9:20am
Okay. So this time the box wasn't filled and price goes straight to the recurrent area. Mmmhh. The current price of EURUSD is in an SR area and price will surely fill your box later.
  • #111
  • Oct 22, 2014 9:30am Oct 22, 2014 9:30am
Hi,guys,I have some problem..
So we must to a a confirmed top,because we don't know if price will keep going up?
thx
Quoting Blackeagle
{quote} I know probability is on your side based on Eurusdd's explanations but what if the price DOES NOT go back to transient zone? Therefore I understand that if my zone turns out to be h-recurrent, my sell position will win, but I don't understand how my sell position wins if my zone turns out to be h-transient and price DOES NOT want to make it recurrent this time and price DOES NOT want to make it recurrent this time and keep going up? I believe this is where SL plays its part but then how about Eurusdd's win-win condition? Anyone? Kins Regards, Blackeagle
This is Eurusdd say
Quoting Eurusdd
Let us supposed we know the yellow area but the market has not develop the blue area yet. We can then assume that when the region B is matured, it will be transient. So, we declare the area A as recurrent. We then move ahead to find sell position above B. Now, if the market pulls back into B, we win. If B turns out to be transient, our assumption of A as recurrent will give our sell a profit. Both ways, we will win!!!
http://i.imgur.com/mDehfGk.png​
  • #112
  • Oct 22, 2014 9:45am Oct 22, 2014 9:45am
for that you dont need zones. sell resistance buy support every six bars

Quoting SunSaltwater
{quote} The black box is where price is still transient. We know that price doesn't like this. I would trade in the direction of the box (long) expecting that box to disappear and price to no longer be transient. Part of the box has already disappeared. It has shrunk. I booked 5.3 pips profit. Now could price keep moving down and never fill that box, or at least not for a while which is why you have to create a trading plan with stops etc. BUT, look back many bars and see how many times price is transient, so few times, it doesn't like it. There...
My Best Trade is Next Trade!
  • #113
  • Oct 22, 2014 9:53am Oct 22, 2014 9:53am
Quoting hilavoku
Okay. So this time the box wasn't filled and price goes straight to the recurrent area. Mmmhh. The current price of EURUSD is in an SR area and price will surely fill your box later.
Correct, but lets watch this one and see how many pips and how much time goes by before it fills. Have to trade with a stop loss but even with this one only partially filling the box can you see the profit potential?
  • #114
  • Oct 22, 2014 10:06am Oct 22, 2014 10:06am
Quoting vlady1974
...... We can see from the image, that only 4 bars to the LEFT of the Focus bar, breached the HI/LO prices. On the RIGHT there were 3 bars that breached the HI/LO prices. So we could summarise that we have a Transient Zone over 4-recurrent prices. Where 4 is the maximum number of bars that have breached the HI/LO
------------------------------------------------
To the left I see 3 bars (not 4) that entered the HI/LO zone; to the right I see 4 bars (not 3). Am I right or I don't understand something?
  • #115
  • Oct 22, 2014 10:14am Oct 22, 2014 10:14am
Quoting MAM.Trader
for that you dont need zones. sell resistance buy support every six bars {quote}
Apologies, but I don't see it like that at all.
  • #116
  • Oct 22, 2014 10:29am Oct 22, 2014 10:29am
Do you see it?

Short based on discretion anywhere in the black arrow area, take profit anywhere in the white arrow area as price comes back to fill the transient zone drawn by the different coloured boxes.

Long same thing, but purple and light blue arrows.

Study this chart and my previous post. This is all you need. Zero indicators.
Attached Image (click to enlarge)
Click to Enlarge Name: Untitled.jpg Size: 126 KB
  • #117
  • Oct 22, 2014 10:32am Oct 22, 2014 10:32am
Ahhh, now I understand whats meant by it.


WARNING: Guys you need to KNOW if the gap is a important news gap or random light volume gap.

The first one has a high chance of continuation. The second has high chance of being filled.
  • #118
  • Oct 22, 2014 10:47am Oct 22, 2014 10:47am
Quoting SunSaltwater
{quote} Correct, but lets watch this one and see how many pips and how much time goes by before it fills. Have to trade with a stop loss but even with this one only partially filling the box can you see the profit potential?
Yes. I see the potential in both directions.
  • #119
  • Oct 22, 2014 10:53am Oct 22, 2014 10:53am
it takes 15 min to code & see the result
yhere are many coders here at thread
give a try
I have done it with many different ways wont work

Quoting SunSaltwater
{quote} Apologies, but I don't see it like that at all.
My Best Trade is Next Trade!
  • #120
  • Oct 22, 2014 10:54am Oct 22, 2014 10:54am
Guys,

You're all advancing pretty quickly actually.
The beginning posts were all to guide beginners with the basics - as was the original intention.

This post from SunSaltwater is a big leap from Beginners - but obviously a little harder to explain
Quoting SunSaltwater
Do you see it? Short based on discretion anywhere in the black arrow area, take profit anywhere in the white arrow area as price comes back to fill the transient zone drawn by the different coloured boxes. Long same thing, but purple and light blue arrows. Study this chart and my previous post. This is all you need. Zero indicators. {image}
Now my personal opinion is that this is a scalping strategy, since it's on the 15M.
You could, in theory, do the same on higher timeframes.... but I would suggest that probabilities do need to be calculated.
At h=6, almost every price is recurrent....
A pip is only worth it if you know how much you risked to earn it
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