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Transient Zones - Basics

  • #241
  • Oct 23, 2014 10:46am Oct 23, 2014 10:46am
Quoting pedma
{quote} I think where you wrote "what is different about this" (blue text) is the best opportunity ..... may be ? (i pay attention to right tz, almost zero distance). {quote} You are right burnssss. Some time i remember this, but some time not
I have spotted this pattern quite a few times, but have not developed a clear way to trade it.
I think it is a rare event pattern. Essentially, it's a double top. But double tops aren't rare events.

There you go... one conceptual dilemma I've been playing with. Free for your consideration
A pip is only worth it if you know how much you risked to earn it
  • #242
  • Oct 23, 2014 10:48am Oct 23, 2014 10:48am
Quoting juriFX
{quote} To me it is a big mystery how you guys achieve such stunning high win rate (90+%) by trading TZs with probability calculations. I don't see how money management can increase win rates. Do you consider stop loss management to MM? Bigger stops reduce the risk:reward ratio. Of course MM is key if you trade a system with average 50% win rarte. Here at least 1:2 risk:reward is the secret. {quote} Yes! But you mean 0.0010 for pairs like EUR/USD (10 pips). USD/JPY would be someting like 0.10
i think you are confused because of the term used. using "Trade Management" instead of "Money Management" is more appropriate when discussing specifically achieving high win rate.
As Above, So Below
  • #243
  • Oct 23, 2014 11:02am Oct 23, 2014 11:02am
Quoting tashkent
{quote} i think you are confused because of the term used. using "Trade Management" instead of "Money Management" is more appropriate when discussing specifically achieving high win rate.
Yes, that's what I was about to say after reading vlady's response. That's trade management.

Quoting vlady1974
{quote} I have spotted this pattern quite a few times, but have not developed a clear way to trade it. I think it is a rare event pattern. Essentially, it's a double top. But double tops aren't rare events. There you go... one conceptual dilemma I've been playing with. Free for your consideration
The following PDF is from my "other" trading plan (harmonic trading).
This is a way to trade double tops/bottoms. Credits go to Jason Stapleton and Akil Stokes...
Attached File(s)
File Type: pdf double top.pdf   30 KB | 7,096 downloads

So on potential UTZs, one could scale down to a faster time frame and trade those setups...
the 3rd wave is the crowd's wave
  • #244
  • Oct 23, 2014 11:29am Oct 23, 2014 11:29am
Quoting juriFX
{quote} Yes, that's what I was about to say after reading vlady's response. That's trade management. {quote} The following PDF is from my "other" trading plan (harmonic trading). This is a way to trade double tops/bottoms. Credits go to Jason Stapleton and Akil Stokes... {image} So on potential UTZs, one could scale down to a faster time frame and trade those setups...
Bam! That's one of the things I do.
A pip is only worth it if you know how much you risked to earn it
  • #245
  • Oct 23, 2014 11:32am Oct 23, 2014 11:32am
Quoting juriFX
{quote} Yes, that's what I was about to say after reading vlady's response. That's trade management. {quote} The following PDF is from my "other" trading plan (harmonic trading). This is a way to trade double tops/bottoms. Credits go to Jason Stapleton and Akil Stokes... {image} So on potential UTZs, one could scale down to a faster time frame and trade those setups...
Great little PDF btw! Thank you for that.
I would suggest that people look for WMD and his take on double Ts and Bs. I use a specific setup of his.
The PDF has some of my rules in there as well. The Left Space is a big one....... now how about that Left TZ....hmmmmmm
A pip is only worth it if you know how much you risked to earn it
  • #246
  • Oct 23, 2014 1:33pm Oct 23, 2014 1:33pm
Quoting LITEchild
...and another. Just takes patience. {image}


I do not place much because English is not my language.

I thank everyone for their contributions and help us beginners

In this picture I had my first child ... eureka ...

thanks
  • #247
  • Edited 4:14pm Oct 23, 2014 1:38pm | Edited 4:14pm
Quoting vlady1974
{quote} Bam! That's one of the things I do.
so you used PTZ as à potentiel reversal trend, And use classics patterns to confirm?

Do you use patterns on the left side of PTZ on lower time frame or on the right side? Or both?
Bottomless wonders spring from simple rules, which are repeated without end
  • #248
  • Oct 23, 2014 1:48pm Oct 23, 2014 1:48pm
Quoting Pipfree
{quote} I do not place much because English is not my language. I thank everyone for their contributions and help us beginners In this picture I had my first child ... eureka ... thanks
You're welcome. Glad it helped.
  • #249
  • Oct 23, 2014 2:04pm Oct 23, 2014 2:04pm
Hello all,

thanks for explaining the concept especially vlady1974 who tries to convey the concept to beginners.
Even after reading the pdfs and the thread multiple times I am still not aware what the concept of RZ and TZ is about and helps me in trading and I would really like to understand it.
Maybe someone could verify or falsify my understanding of the concept.
Let's suppose my h = 4 and the current bar has a TZ, because the lower wick is not touched by the last 4 bars to the left. Now I think, ok, the last 4 bars to the left did not reach that lower wick so the next 4 bars to the right will also not touch that lower wick and I buy. The problem is for me that in a downtrend I would always buy against the trend because I would constantly get new tranzient zones. Is the TZ about to take counter trend trades Swing Highs and Swing Lows? But how do I know in that situation if it will be a Swing High and Swing Low?
The other way is to wait until 4 bars to the right side also did not touch the TZ and then sell with the asumption that 97% of the TZ are taken out but this will also not work.

This is a current EURUSD 4h chart with h = 6 and tranzient zone indicator.
Attached Image (click to enlarge)
Click to Enlarge Name: Screenshot1.png Size: 71 KB


I guess I am totally wrong somewhere and don't understand the concept. I hope it will make click and I get the concept because I don't know what to read more about it.
  • #250
  • Oct 23, 2014 2:45pm Oct 23, 2014 2:45pm
Quoting Myrmica
Hello all, thanks for explaining the concept especially vlady1974 who tries to convey the concept to beginners. Even after reading the pdfs and the thread multiple times I am still not aware what the concept of RZ and TZ is about and helps me in trading and I would really like to understand it. Maybe someone could verify or falsify my understanding of the concept. Let's suppose my h = 4 and the current bar has a TZ, because the lower wick is not touched by the last 4 bars to the left. Now I think, ok, the last 4 bars to the left did not reach that...
I found the original explanations in the Similarity thread given by eurusdd. The original propositions and deductions state that with the proper h value, 97% of prices are recurrent. It does NOT say that if your h value is correct, that 97% of potentially transient bars are recurrent.
To answer your other question, yes, trading purely transient zones will result in you always trading against the current trend. You will need additional tools/extrapolations from the propositions to trade in sync with the HTF trend.
"Mrrraggglhlhghghlgh"
  • #251
  • Oct 23, 2014 2:55pm Oct 23, 2014 2:55pm
Quoting LITEchild
{quote} Like I said earlier, based on my understanding, the probabilities are much more tied to PTZs as opposed to CTZs. {quote} Take a good look at the price I was filled at. If price had simply kept going down(like it usually does in many cases like this), My trade would simply not have been triggered. For me to be committed to make an entry, price had to do something RARE! I really I'm saying too much now and should probably shut up.
THANK YOU! Another Clue sweet I've been reading both threads for > 2 months now, things are finally beginning to relate with eachother
A Positive Mind, and Positive Spirit lead to True Happiness
  • #252
  • Oct 23, 2014 3:09pm Oct 23, 2014 3:09pm
Quoting LiquidGenius
{quote} I found the original explanations in the Similarity thread given by eurusdd. The original propositions and deductions state that with the proper h value, 97% of prices are recurrent. It does NOT say that if your h value is correct, that 97% of potentially transient bars are recurrent. To answer your other question, yes, trading purely transient zones will result in you always trading against the current trend. You will need additional tools/extrapolations from the propositions to trade...
hey buddy, i have a feeling there is an error in there somewhere...i may be wrong though so...
  • #253
  • Oct 23, 2014 3:10pm Oct 23, 2014 3:10pm
Quoting Rparm
{quote} THANK YOU! Another Clue sweet I've been reading both threads for > 2 months now, things are finally beginning to relate with eachother
  • #254
  • Oct 23, 2014 4:15pm Oct 23, 2014 4:15pm
Here is a nice indicator for your chart which shows all timeframes if there is a trend or range
Attached File(s)
File Type: ex4 3SMA-TrendFilter.ex4   8 KB | 801 downloads
  • #255
  • Oct 23, 2014 5:22pm Oct 23, 2014 5:22pm
I found part of the answer to a question I had about the probability of clearing the PTZ after 4 candles had already passed.

Post 10451 by KPRSA on the sim thread:
... only 100%-60.48%=39.52% of the total number of cases have remained transient after 4 bars and this is supposed to be our starting point for a strategy. So the calculated 19.23% of the total number make slightly less than 50% (19.23/39.52=48.66%) of the remaining transient zones. Therefore the probability of clearance (within this quite long period of 12 bars) after one has observed that the h=4 zone wasn't cleared, is slightly less than 50%.

Seems if it doesn't come back within 4 bars, a PTZ would need to be present in the same area on a higher time frame in order to trade toward the PTZ.
  • #256
  • Oct 23, 2014 8:22pm Oct 23, 2014 8:22pm
I think it make sense why we look at bigger TF, cause it is small, so we still have room to get provit. If we are using M1, then it is no chance. Smaller TF just for take action. Now i think i got it, this proposition 1 equation. It must be +-k, both way. Thats why 2 images of him are different, and we do not need to wait.
  • #257
  • Edited 9:08pm Oct 23, 2014 8:50pm | Edited 9:08pm
/
Don't use both feet to test the depth of the river
  • #258
  • Oct 23, 2014 9:04pm Oct 23, 2014 9:04pm
Quoting LITEchild
{quote} hey buddy, i have a feeling there is an error in there somewhere...i may be wrong though so...
Care to say how so?
"Mrrraggglhlhghghlgh"
  • #259
  • Edited 9:18pm Oct 23, 2014 9:04pm | Edited 9:18pm
/.
I want more brain power!
  • #260
  • Edited 9:20pm Oct 23, 2014 9:08pm | Edited 9:20pm
/
Don't use both feet to test the depth of the river
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