Transient Zones - Basics | Page 15 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

Back to basics or information overload? 12 replies

Tutorial style book for technical basics? 2 replies

Currency Trading: Understanding the Basics of Currency Trading 0 replies

Starting from the bare basics... 3 replies

Options & futures basics 1 reply

Attachments: Transient Zones - Basics
Exit Attachments

Transient Zones - Basics

  • #281
  • Oct 24, 2014 5:19am Oct 24, 2014 5:19am
Quoting limprobable
{quote} If i take a price randomly now, for example 1232 on gold. I wait 5 minutes for example, and price is now at 1231 and price have not yet come back to 1232. Does that mean that price have 97% if i buy now, that price will come back to 1232?. Of course you dont need bars for that, cause you cant see if price come back or not in a longer bar, you need a tick by tick chart. Sure i need time, 5 minutes in this case, but in another case it will be 10 minutes, 4 minutes or 30 minutes, so i'd better take a tick by tick chart and dont matter about...
Absolutely completely without a doubt out of business!

97% price will go back yes but when? Tick charts and ignore time? 10 ticks? 1000 ticks? 3445636747 ticks? Wow you've successfully managed to surprise me.
I want more brain power!
  • #282
  • Oct 24, 2014 5:26am Oct 24, 2014 5:26am
Quoting cfdtaleong
{quote} No I don't think so. I mentioned it a few post earlier. Price is 97% recurrent. h is what you use to filter out the 3% via your indicator. If your h value is small then of course you will see a lot of false positives. The optimal h is a value you use to filter down the data such that it returns only 3% of the values as positive. 97/3 is the nature of price, h is the value you use to identify this values correctly. To phrase in yet another way, price remains 97/3. If you set your h to something not optimal then you are looking at data...
Where's Vlady's "head hurts" image? I need that right now! That statement in bold is some heavy stuff man.
You reap what you sow.
  • #283
  • Oct 24, 2014 5:30am Oct 24, 2014 5:30am
Attached Image


A pip is only worth it if you know how much you risked to earn it
  • #284
  • Oct 24, 2014 5:33am Oct 24, 2014 5:33am
Quoting vlady1974
{image}
Thanks mate
You reap what you sow.
  • #285
  • Oct 24, 2014 5:51am Oct 24, 2014 5:51am
Quoting vlady1974
{quote} I suspect that people here are confusing or placing more emphasis on Trade Entry instead of Trade Exit....
wow. i wish folks realised the weight of that phrase. my achilles heels as far as scalping is concerned. but getting there...nice one my friend.
  • #286
  • Oct 24, 2014 6:02am Oct 24, 2014 6:02am
Quoting LITEchild
{quote} wow. i wish folks realised the weight of that phrase. my achilles heels as far as scalping is concerned. but getting there...nice one my friend.
Cheers my friend.

I actually think there is huge gravitas in these two resources:

  1. Mark Douglas - Trading In The Zone
  2. Van K Tharp - all his books, but mainly Super Trader, Trade Your Way to Financial Freedom

My statement has come from the amalgamation of what I've learned from these fine gentlemen.
How this relates to TZ could be obvious to some and clear as mud for others.

A pip is only worth it if you know how much you risked to earn it
  • #287
  • Oct 24, 2014 7:02am Oct 24, 2014 7:02am
Hi Trader,
Vlady Thanks for creating this Thread and many many thanks to EURUSDD for sharing a Idea about probability. I am a newbie so silently reading all post here and in Similarity thread. Some of guys are intelligent and find the correct way and they make good profit with this theory. As notice if some one found the way they kept it secret ..... Just i want to say you guys if He/She find then why we can't ...! Lets Do it \m/ (Sorry English is not my first language )
Newbie
  • #288
  • Edited 7:13am Oct 24, 2014 7:03am | Edited 7:13am
Maybe you can see the 'basic' of TZ that repeatedly and constantly 'show up' even with very basic renko chart and standard zigzag, if you know the principle of price movement..

Attached Image (click to enlarge)
Click to Enlarge Name: GBPUSD M11 10.2 brick size basic renko with ZZ represent TZ.png Size: 227 KB


GBPUSD basic renko chart with 10.2 point brick size (average size of last 1440 M15 GBPUSD candles).


similar story with CRB

Attached Image (click to enlarge)
Click to Enlarge Name: GBPUSD M11 10.2 point CRB with ZZ represent TZ.png Size: 301 KB


and you can compare it with standard M15 candlestick chart

Attached Image (click to enlarge)
Click to Enlarge Name: GBPUSD M15 10.2 average candlestick with ZZ represent TZ.png Size: 241 KB


in my opinion the key is that horizontal lines and not the shape of the candles

MTH
  • #289
  • Oct 24, 2014 7:29am Oct 24, 2014 7:29am
Quoting cfdtaleong
{quote} Absolutely completely without a doubt out of business! 97% price will go back yes but when? Tick charts and ignore time? 10 ticks? 1000 ticks? 3445636747 ticks? Wow you've successfully managed to surprise me.
Ok i see. Sorry, i feel stupid. (vlady "feel stupid" image?)
Bottomless wonders spring from simple rules, which are repeated without end
  • #290
  • Oct 24, 2014 7:49am Oct 24, 2014 7:49am
Quoting limprobable
{quote} Ok i see. Sorry, i feel stupid. (vlady "feel stupid" image?)
Don't be, its how we all learn. I would respectfully sugest that once we have an opinion formed, take a moment and think about the validity of that opinion first. Often you will be suprised at how much you learn on your own as you attempt to "counter" your own opinion first. As I've learnt from others in trading we often only think about what is required to make a trade work and negelect the elements that would make it not work. Easier said than done of course but the benefits it brings to game cannot be ignored.
I want more brain power!
  • #291
  • Oct 24, 2014 8:06am Oct 24, 2014 8:06am
Quoting limprobable
{quote} Ok i see. Sorry, i feel stupid. (vlady "feel stupid" image?)
CFD's advice is brilliant Limprobable.
It's not about emotions... so don't feel like you're somehow deficient because you're not understanding, etc. It's just how we learn.

The key is forming the opinion. You have to have one. Period.
You can't test anything if you don't have one.

The result of your test will feedback to you what the market is doing.
Stack enough results and you will see whether you have an edge or not.
Collect the statistics of your tests/edge and you will be able to calculate the probability of it's win/loss ratio and profitability.

So having said that, you should be able to form some "opinions" about the TZ and test whether or not the recurrence theory holds true for your "opinion".
A pip is only worth it if you know how much you risked to earn it
  • #292
  • Oct 24, 2014 8:28am Oct 24, 2014 8:28am
Quoting vlady1974
{quote} CFD's advice is brilliant Limprobable. It's not about emotions... so don't feel like you're somehow deficient because you're not understanding, etc. It's just how we learn. The key is forming the opinion. You have to have one. Period. You can't test anything if you don't have one. The result of your test will feedback to you what the market is doing. Stack enough results and you will see whether you have an edge or not. Collect the statistics of your tests/edge and you will be able to calculate the probability of it's win/loss ratio and...
  • #293
  • Oct 24, 2014 9:39am Oct 24, 2014 9:39am
Quoting NorthTrader
EU, M15, h=21, 9956 bars:
Fully recurrent bars = 68%
Left-only recurrent bars = 18%
Right-only recurrent bars = 11%
Tip-TZ bars = 2%
Mid-TZ bars = 1%
Total = 100%
Quote
What does this say to me?
1) If the current bar is a PTZ (21 bars to the left didn't touch all prices in the current bar), then the chance of it becoming right-only recurrent within the next 21 bars is nearly four times greater than the chance of it becoming full transient.
2) If the current bar is recurrent (all prices were touched by at least one of the last 21 bars to the left), then the chance of it becoming fully recurrent within the next 21 bars is nearly four times greater than the chance of it becoming left-only recurrent.
Quote
3) So, the chance of price returning to all prices in the current bar, within the next 21 bars, is always nearly four times greater than price not returning to them.

Hello NorthTrader,

the figures you mentioned above are very interesting. Did you use an indicator to calculate them? It would be great if you could share it.
  • #294
  • Oct 24, 2014 11:48am Oct 24, 2014 11:48am
Quoting JohannaV
{quote} {quote} {quote} Hello NorthTrader, the figures you mentioned above are very interesting. Did you use an indicator to calculate them? It would be great if you could share it.
K's recurrence indi in the attachments. Also note the ~4X figure may also be seen in the stats as: Freq of possible problem bars / Freq of true problem bars
  • #295
  • Oct 24, 2014 8:37pm Oct 24, 2014 8:37pm
Quoting Barbaresco
{quote} K's recurrence indi in the attachments. Also note the ~4X figure may also be seen in the stats as: Freq of possible problem bars / Freq of true problem bars
Actually no, I dont use K's indicator because I don't use MetaTrader. My indicator is a NinjaTrader version. It's comforting that the stats agree with K's though.
You reap what you sow.
  • #296
  • Oct 24, 2014 8:48pm Oct 24, 2014 8:48pm
Quoting vlady1974
{quote} ..... As an NLP practitioner, I can tell you it doesn't work that way - no matter how you think you've simplified it. .......
thanks Vlad, sorry for this newbie question: "what is NLP practitioner" ?
Good friends are more valuable than gold ...
  • #297
  • Oct 24, 2014 11:24pm Oct 24, 2014 11:24pm
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
Yes, you are right mate. Too fast in typing .....

Quoting vlady1974
{quote} I clearly can't speak for Fx-Jay whose results are stellar. But because we're all implementing our understanding of the same elements differently, whilst we can sometimes have the same timing of entries... our performance may not be "efficient" as Van K Tharp would describe. For example, last night, I made a mistake doing an experiment with Kiwi crosses and I got the relationship wrong for one pair but right on another. The net effect was +87 pips on one trade but -150 on another. No big deal cos I got the diff back on some EU and AU trades. The point is this... the mistake had nothing to do with TZ. I basically, in my rush and lack of concentration whilst commuting, forgot to set SL. As simple as that. Then Kiwi tanked and I panicked and added to a losing trade. Classic Trading Error. Nothing to do with TZ. TZ timing perhaps but.... it's just another tool... it's just another blah blah. I'm the one who pulls the trigger. I am Money Management. I am Exit Strategy. I am Entry Strategy. I am responsible for the result of the trade. Not the signal. (Sorry, my teaching tone has come back). I'm revealing this just to show you that we're not infallible. We make mistakes. It's part of trading.
You are absolutely right mate ....
Good friends are more valuable than gold ...
  • #298
  • Oct 25, 2014 12:00am Oct 25, 2014 12:00am
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
Thank you very much mate, it is more clear now. A blind man can see a shadow of a candle light . i will try to play with kprsa's to make all thing better ...
Good friends are more valuable than gold ...
  • #299
  • Oct 25, 2014 4:22am Oct 25, 2014 4:22am
Quoting vlady1974
H and Probability Okay, now is the time to get down to brass taxes. Let's go to the "Jewels of the TZ Section" document: "There is a minimum value for h for which 97% of prices h-recurrent" "The beauty of this is summed up in one powerful statement - Price is 97% recurrent, 3% transient" I believe this is one conceptual hurdle that people have had trouble with in terms of applying TZs to a trading opportunity. It's because h is like a garment or clothing size. If I'm Large, then the measurements won't be the same as a Medium... but the item of clothing...
Guy thank you for this great work you are doing. you have made me understand even support and resistances better.
Please, help me clarify this questions:
1) what are problem bars?
2) are fractal bars thesame with focus bars? and if not, please what are fractal bars because i understand focus bars.
thanks.
  • #300
  • Oct 25, 2014 5:03am Oct 25, 2014 5:03am
I HAD this on my laptop from somewhere i cant remember and am sharing it ,may be it will be useful for those that want to analyse transient zones with volume. I wont say more than that.
Pulse and think mostly on eurusdd way of thinking on price behavior.

How the price makes and how the price up and down? I’ll give you example on “How the price make?” at a simplified simulation.

Simulation of: “HOW PRICE CHANGE?” in simplified.
Name of multi-Currency: GBPJPY Present price: 172.354 bid, 172.379 ask (example only)
Name of Institution that look into this price: MM1, MM2, MM3.
MM1 already hold their position open in market as long. They have 20 open long already. Here is the list of their offer (bid) price:
172.600 (2 Position)
172.750 (3 Position)
173.100 (4 position)
173.300 (11 position)
MM2 and the other looking for Short position, so, they look to Short at highest price as possible.
What happened next when some of the MM fill or do a deal in market?
MM2 Open short by fill order MM1 at 172.600. The price jump up from 172.354 bid into 172.600 bid
and 172.620 ask. This order makes the new price now updated into 172.600 (bid) and 172.620 (ask).
This is the new price.
Then MM3 Open short by fill order MM1 at 172.750. The price jump up from 172.600 bid into
172.750 bid and 172.780 ask. This order makes the new price now updated into 172.750 (bid) and
172.780 (ask). This is the new price.

The prices itself already SHOW the position that MM look for in the future. As you see from example above, price jump up when the MM opening short. Jump up again, when another MM opening short again. I ask you to keep this as a secret (Ha ha ha ha….). So, no wonder if retail trader 90% suffered loss. The trend that many retail trader follow, actually is the result of the opposite position from MM. They know the future, but retail trader not. Then, if we are in the same page here, we can
conclude with: “price trend up, we looking for short; price trend down, we looking for long.”
By understand “price up, we looking for short; price down, we looking for long.”, doesn’t mean that
we should blindly jump in, and open position.
We Win Some, We Loose Some, But Let your Win Rates be More to be Successful
0 traders viewing now