Simple Mean Reversion

[kesTkNon]

Hello, and thanks for stopping by! No matter if you're new or old member of this forum, read here and that I guarantee you won't be let down! From my point of view that this thread is the natural continuation of this thread Greater Edge within one Candlestick” and here I mean to share with you some of my discoveries concerning this idea. As I commented at the original thread, I think that we may create and apply numerous egies only using the data that's...
Much obliged Alpha Omega...https://www.forexforum.co.za/attachments/1528683020.jpg

[Gesrcesy]

Hi, and thanks for stopping by! Regardless if you're new or old member of this forum, keep reading here and that I promise you won't be let down! From my standpoint this thread would be the normal continuation of this thread Greater Edge within one Candlestick” and that I mean to discuss with you some of my discoveries concerning this idea. As I commented at the original thread, I think that we can create and apply numerous egies only by using the information that is... I'm in... Keep up the great job!

[UtesSttcabesr]

Subbed ...

[ToTu]

Can you please refine the principles?

At the first tick of the day that the price is the only one. We've got price=highest=lowest=mid. If I mechanically follow the principles:

that I have no place open AND the current price is equal to the maximum price AND the current time is under the mid cycle
=gt; According to rule 1 I shall open a position.
Now I've an open position AND the current time is before the mid cycle AND the current price is equivalent to mid range
=gt; According to rule 3 I shall shut the position!

Clearly my case is stupid as it is a degenerate case however a minimum time following open (source of this box) or minimal range may be necessary especially since the source is at a time of cheapest volatility in which the range will remain tight for some time and the low liquidity is likely to make the price cross the mid many times fast.

[nescha]

You're on the ideal track that this system is the genesis of a rewarding journey.
PM me and that I can discuss my notes on analysis of one daily candle as well as the cycle or phase every Foreign Exchange pair exhibits daily.

Roy

[vuxxesvesS]

Could you please refine the principles? At the first tick of the day the price is your just real one. We have price=highest=lowest=mid. If I mechanically follow the rules: I have no position open AND the current price is equal to the highest price AND the current time is under the mid cycle =gt; Based on rule 1 I shall open a position. Now I have an open position AND the current time is ahead of the mid cycle AND the current price is equal to mid range =gt; Based on principle 3 I shall shut the position! Clearly my example is stupid since it's a degenerate case... You answered your own questions!
Of course we want minimum range. This is part of the egy but I abandoned the details for next posts. (I can't write long posts now)
We all try to capture just 50%(maximum ) of the range throughout the first half of the day.
So by way of example if we've range 5 pips it does not make sense to open position since the maximum possible profit is simply 2.5 pips.
This is the reason why from the next system coating I use sqrt(t) to determine optimal entry points. I have this calculation in graphical/visual form also.

I shall explain these things later! You will see how everything fits together if we add automation and once we diversify the machine to run concurrently on large number of markets. It's the actual thing! With the ideal technology this system can become high frequency profit monster! https://www.forexforum.co.za/attachments/1528683020.jpg
https://www.forexforum.co.za/attachments/1528683038130649582.jpg

[rC020202]

I am playing on this system today, I really like it. Whenever there are no strong trends it'll perform very well. I am thinking that to open a transaction, the current range shouldn't be lower than 50% of ADR. Or the lower your current range, the bigger TP degree, which gets lower through the time.
The 25% retracement are really wise thing.
Some of the transactions today:
https://www.forexforum.co.za/attachments/15286830402042232334.jpg
Looking forward the best way to include sqrt(t) to this. https://www.forexforum.co.za/attachments/1528683022.jpg

[Axr?Es15021993]

quote Much obliged Alpha Omega...https://www.forexforum.co.za/attachments/1528683022.jpg Hello AlphaOmega,
This egy I have worked for last 3 years. The enhanced use of this egy require some specific Technical conditions. I have optimized it to reach to 50% degree at least of the range. It needs somewhat different rules but of course based on this simple egy you've clarified here.Be alert, Taking into account only the Time block and Daily price range can easily flush-out your account. A couple failures will lead to margin call since there's not any limit on how much price can move against you until the end of the period block. However, for sure if you're able to combine the specialized analysis also you are able to discover good egies.

https://www.forexforum.co.za/attachments/15286830422005384736.jpg

[EsSaxdon11]

Hi AlphaOmega and thanks fort this egy.

What is going to happen whether the market make a massive movement in one direction and does not come back? With this pyramid system, You will likely have a lot of positions in loss.

You are able to observe this condition twice on Your screenshot in the first post. I believe that it would be hard to recover from those huge losses...

[vuxxesvesS]

Hi AlphaOmega and thanks fort this egy. What is going to happen whether the market make a massive move in 1 direction and doesn't come back? With this pyramid system, You will probably have a lot of places in loss. You can observe this condition twice in Your screenshot in the first post. I believe that it would be tough to recover from these big declines... Yep. That is pretty much the only potential flaw of this machine. The week place. Https://en.wikipedia.org/wiki/Achilles'_heel https://www.forexforum.co.za/attachments/1528683023.png Each machine has a weak place.
That is why the entire development of this method is concentrated on different methods to reduce the effect of those undesirable https://en.wikipedia.org/wiki/Fat-tailed_distribution.
The fantastic news is that nearly half of those fat tails are brought on by economic information (news). And the majority of these news are understood beforehand. They are scheduled at the economic calendar.
So right from the start we can program the machine to prevent nearly half of these risks. And we are left with the other half.
When we find effective approaches to reduce the % of losing days down to 4 percent (or less) - we can have relatively steady and exceptionally profitable system. (Fully automated)

[EsSaxdon11]

quote Yep. This is pretty much the only potential flaw of this system. The week spot. Https://en.wikipedia.org/wiki/Achilles'_heel https://www.forexforum.co.za/attachments/1528683023.png Each system has a weak spot. That's why the entire development of the system is concentrated on various procedures to reduce the effect of these undesirable https://en.wikipedia.org/wiki/Fat-tailed_distribution. The good news is that nearly half of those fat tails are brought on by economic data(news). And most of these news are known beforehand. They're scheduled... What can we do, apart avoiding the news, to reduce the losing days. With those losing trades, the risk payoff will be pretty low

[esndrusynua]

Fantastic thread and thank you for sharing all of your hard work. I've been playing the indior and remembered some time backI did a little research on when Hello or low of the afternoon is shaped and found from LO it is normally the first couple of hours. Having gone through your indior, I can see that if there's a low or hi just after LO also it return throughout the midpoint then we could expect the overside to be shaped.
So, if we've got a low after London open then it moves through the midpoint we could expect to find a hi form, most time of exactly the same distance.

Just a observation https://www.forexforum.co.za/attachments/1528683023.png

looking forward to learning more about that thread https://www.forexforum.co.za/attachments/1528683023.png

[EsnakuCa26]

You men are avoiding high volatility periods.
I am the individual who can not wait for such days because making profit is efortless then.

Thank you for sharing but imho there's absolutely no advantage in such system.
It might have very substantial drawdown.
The only means to make profit would be handling to withdrawal earnings before the stop outside occurs.

[Royos]

Hi!

In threads Quantum London Trading by mer071898 https://www.forexforum.co.za/general-forex-discussion/342-live-trading-analysis.html
and Q A M Trading Strategy by https://www.forexforum.co.za/cryptocurrency-forum/407-lowest-range.html
men did a lot research regarding to such trading style.

States in his first post:
Initially only 2 currency pairs EURCHF and EURGBP is going to be traded due to their common'turtle' such as behaviour.
EURCHF WILL BE THE ONLY PAIR traded at the Beginning.
EURGBP is going to be traded at a much later stage.

TRADING WINDOW
Asian Session initially over a 6 hour trading period
Start Time = Tokyo Open
End Time = Frankfurt Open

After it Can Help prevent losses Brought on by tendencies.

With regards,
SP

[EsSvZ8]

Hello, and thanks for stopping by! No matter if you're new or old member of this forum, keep reading here and that I promise you will not be let down! From my standpoint this thread is the normal continuation of this thread Greater Edge within a Single Candlestick” and here I mean to share with you some of my discoveries regarding this idea. As I commented in the first thread, I think that we can produce and apply numerous egies only using the information that's... appears interesting. I am in https://www.forexforum.co.za/attachments/1528683023.png

[Suntos17]

quote What do we do, besides preventing the news, to reduce the shedding days. With those losing trades, the risk reward would be quite low One may perhaps use it on an instrument with the cheapest 14-day ADR?
Cheers,
k

[Cunucrus25]

Fantastic luck kolega!

[Cacces]

Mean reversion, fat tails and cycles.

This includes a statistics/ML ring to it.

.... sub'd.

[barjes_hornes]

Thank you for sharing your own system.

Yes you're right we are using two different systems, but we are using the same properties in our systems. Interesting.

I follow your thread from today, keep going mate.

[axtica00]

Indior quite similar to DRS indior: https://www.mql5.com/en/code/10214
https://www.forexforum.co.za/attachments/1528683065972709890.mq4

[ISusosyTesTes]

This is my first version of the DRS indior which additionally has the chance to show the mentioned atr based projected volatility bands
https://www.forexforum.co.za/attachments/1528683067582929572.jpg
https://www.forexforum.co.za/attachments/15286830691514475867.jpg
https://www.forexforum.co.za/attachments/1528683071930245446.0j

[zesyess]

My buddy Jagg showed me this thread and I can't resist. If it's helpful I will remain and attempt to enhance it with your all help.

You need to choice to toggle all at will. Change colors and opacity to fit your requirements.

Https://www.forexforum.co.za/attachments/15286830731730818656.jpg
https://www.forexforum.co.za/attachments/15286830751989306729.jpg
https://www.forexforum.co.za/attachments/1528683078446782688.jpg

Attachment 2828209

I will follow this today, so don't hesitate to ask improvements.

Upgraded version with better performance whilst painting all the stuff (sorry for that).
https://www.forexforum.co.za/attachments/15286830801792971564.ex4

[vuxxesvesS]

This is my first version of the DRS indior which also has the chance to show the mentioned atr predied projected volatility bands image image file Nice.


My friend Jagg showed me that this thread and I can't resist. When it's helpful I will stay and attempt to improve it with your help. You have to choice to toggle all at will. Change colors and opacity to fit your requirements. image image image 2828209 I will adhere to this today, so feel free to request improvements. Updated version with better functionality while painting all the stuff (sorry for that). file Nice.
Which type of drawing egy you use? Initially I wanted to use DRAW_FILLING but sadly for some reason I cant make it work in MQL4. (It only works with mql5).

[zesyess]

quote Nice. quote Nice. Which kind of drawing egy you use? Initially I wanted to utilize DRAW_FILLING but unfortunately for some reason I cant make it work at MQL4. (It only works with mql5). Thx.

I builded my own graphical library for MT4, therefore I'm indepent in the MT4 developer team (it is complete rubbish to include features in the language but not to use them entirely ).

[SuCaa123456]

Great thread.

That I have a couple questions that I was hoping OP could help answer:

1) Are there any other ways to determine the start/end of a cycle apart from the hours? (Or would 00hrs-23hrs the universal cycle? ) )
2) Are some cycles longer/shorter in some specific pairs when compared with other people? How would you decide this? Sessions, maybe? Sessions maybe?
3) What are your normal drawdown proportions like?

[Jesrrusak]

https://www.forexforum.co.za/attachments/15286830841460113801.jpg

[sesru123]

picture Hi can you discuss your indior that are in your post?

[Jesrrusak]

quote Hi can you share your indior that are in your post? There Isn't Any indior

Chart is from Alex C.

I merely used: my eyes and Paint

[ISusosyTesTes]

Little cosmetic update to my indior... (gradient colors for ATR level bands also possible now)
https://www.forexforum.co.za/attachments/15286830861319136109.jpg
https://www.forexforum.co.za/attachments/1528683087369827976.jpg
https://www.forexforum.co.za/attachments/15286830892022354113.1j

[EsSbes07]

Hello, and thanks for stopping by! No matter if you're new or old member of the forum, read here and that I guarantee you will not be let down! From my standpoint this thread is the normal continuation of the thread Greater Edge within a Single Candlestick”. . .Range. The range is simply (large -- non ) for the current cycle. Mid - this really is the middle of the range. Or, mid=high-(range*0.5); Or (high low)/2; sqrt(t) - This really is the square root of time. ... And I guarantee you that if... Wow wow... thank you for creating this great thread alpha omega, the first and the last... https://www.forexforum.co.za/attachments/1529311171.png
Sqrt(t) is quite intriguing, but unfortunately I am weak in math... like on image below... https://www.forexforum.co.za/attachments/1529311172.png Need to finish some house functions. So busy at the moment. Beginning by studying a few of your great things is my first plan and attempt to get as far as I can with my feeble mind... The Point is, I am sure this will be quite valuable for me personally...
I understand my Cyclic daily tasks take up a lot of my own time, so I can not participate much in this long run, but I will stop by every time I can and try to combine your thought with other ideas, I am sure it will give me more success... https://www.forexforum.co.za/attachments/1529311172.png
Best regards.
https://www.forexforum.co.za/attachments/1529311172.png

[cesrCon]

quote Wow wow... thank you for creating this fantastic thread alpha omega, the first and the last... https://www.forexforum.co.za/attachments/1529311172.png Sqrt(t) is quite interesting, but unfortunately I am weak in math... like on image below... https://www.forexforum.co.za/attachments/1529311172.png must complete some house functions. Quite busy at the moment. Starting by studying some of your great things is my very first plan and attempt to get as much as I can with my weak mind... The Point is, I am sure this will be quite valuable for me... I understand, my Cyclic daily jobs occupy a lot of my time, therefore I can not engage much in this close...
Was that from Pythagoras? He had been one of the first traders of the famous Greek Drachme.

[cesrCon]

Here is an excel file, you can use for calculating the distances, at which stage to put in a trade.

You have to input the beginning of the afternoon:
a) The Open
b) The dailyrange = Average daily range over 20 days
c) alfa = a percentage. It's fixed at 10% at the moment. This percent is taken of the dailyrange.
==gt; ADR = alfa * dailyrange.

Per hour is calculated the reduced range and the upper range.
Upper range = OPEN ADR * SQRT(hour)
Lower range = OPEN - ADR * SQRT(hour)

This provides a simple worksheet for the day. Here it is possible to check where price needs to be in a certain time
of day in order to go into a trade.

The current excel file has the data for gbpjpy of today. The open was 150.16 and the average daily range is 1.197 (119 pips).
Alfa = 0.10

This also results in a lower border of 149.74 in 12 o'clock. Price must be 149.74 or reduced in order to buy this.
However, it didn't reach this level, so we do not buy at the moment.
https://www.forexforum.co.za/attachments/15293111791577906315.xls

[TORDUTEsRDA]

quote... A trading egy that purely depends upon price:time show on just 1 chart (one pair and one timeframe) will not survive more than 3 decades. 3 Years is somewhat arbitrary to eliminate the human luck factor and to incorporate discipline in implementation with optional style. There is not a single automated egy that could last for 3 yrs in retail forex that's based on one chart one pair one time. . VEEFX; there is 1 egy that satisfies your criteria above; and it's been working indefinitely; market earning.

Liquidity providers (including banks) are doing it since the inception of these markets. Their egy only cares about current bid/ask, and forthcoming news events (where they decrease their risk exposure).

That said; you do have a point in using a egy not lasing more than 3 decades. This is because to triumph in trading; you need to adapt; and enhance the egies all the time. In 3 years period; the egy remains running; but due to the advancements made; it is perhaps not regarded as the identical egy. The edge is the exact same. It's either:
- momentum based (aka trend after )
- mean reversion
- market making

CP for instance; uses momentum. (hints: His egy Won't work on pairs Aside from GU)

[CUCEsOSEsNG]

VEEFXthis is for you.
Once I've prommissed to youpersonally,
to explain to you just how you can see a range?
Can you recall that?
Unable to talk about a chart now.
Some smart wolves sniffing around here.

I shall just simply clarify it.

In a strong fashion, the price does not brake previous/last top/bottom.
Range is opposite to that.
First range signal is a false break of an opposite top/bottom.
More of this follows shortly after.
You are in a range now.

I trust you will appreciate my honesty.

[vuxxesvesS]

quote Thanks MZ. I certainly remember and appreciate the honest response. I've learnt a lot because I posted that question on your thread. What is your take on the 12 queries I posted before. My reply is a resounding Yes all the 12 questions. AO answer is opposite of what my research tells me. Just like everything on the market, it always depends on the trader, what they see and the way they respond. It is an essential element for market to exists I guess:--RRB- the majority of your queries have cloudy definition.
My first premise was that by win/loss ratio that you mean gross profit divided by gross loss. Also known as profit element. If this is the case then my answers stay as they are.

But if you mean percent (percent ) of profitable trades, then the answers will be yes. BUT again, together with the premise that all trades have equidistant fixed stops and targets. Otherwise you will receive different supply.

Nevertheless under this condition the motives for the placement of the trades is irrelevant. Regardless of the egy, IF you put random trades in all directions you will receive random outcomes. Period. (50:50)-cost. No escape from this!

[CUCEsOSEsNG]

quote What is your take on the 12 questions I submitted earlier. I have found, for myself, trading is a sport of:

Tops
Center
Bottoms

Plenty of pips, when avoiding the Center.

Center is aligned with timing.

Everything Starts and Ends in the Center.

The only means to survive, in a very long term, is to learn how to avoid the Center.

The Market Makers want you to trade in the Center.

Center is their best interest and best buddy...

This is quite practicle opinion... I hope it will help.

P.s. Everyone must loe the answer of”How?” For oneself's.

[TORDUTEsRDA]

quote Thanks AO. My apologies for not being crystal clear. I wasn't speaking about Profit Factor at all. Profit Factor is determined by the outcome of a egy. I had been only referring to entry setups based on current market conditions at the point of entry relevant to the subject of the thread i.e. Reversion to Mean anticipates a market to revert from some OB/OS or whatever level the egy targets with the expectation that reversion will proceed to it's final destination (i.e mean in this instance ). How you specify levels or mean is irrelevant. I was also... the six dimentions thingy is an over kill.

When you enter into a commerce; the market can go in the direction of your commerce, against it, or move. 3 possibilities just.

Keep it simple. As soon as you open a position; exit at a profit, and whether the market goes against nowhere or you exit at a reduction. period.

[vuxxesvesS]

quote Thanks AO. My apologies for not being crystal clear. I was not referring to Profit Factor in any way. Profit Factor is dependent on the outcome of a egy. I had been purely referring to entrance setups based on current market conditions in the point of entrance pertinent to the subject of this thread i.e. Reversion to Mean anticipates a market to revert from some OB/OS or whatever level the egy goals with the anticipation that reversion will proceed to it's final destination (i.e mean in this case). The way you define mean or levels is irrelevant. I was also... Yes I agree.

It's even simpler than that!
Trading is only a sequence of binary options (Bets) under different conditions.

For example:

if (trend == true)
choice 1 = bet on continuation;
option 2 = bet on reversion;

if (fad == false)
choice 1 = bet on upwards Trend;
option 2 = bet on Down Trend;

And you always have option 3, that the safest bet - Do nothing and wait patiently!

You can also trade solely predied on expectations and fundamental details. Without analysis. However, this is just another story.
Lets just stick to the subject. https://www.forexforum.co.za/attachments/1529311173.png

[TORDUTEsRDA]

quote Thanks. Glad you agree and well said in bold. If you quantify all of the binary options, there is hardly any (if any) edge left for traders to exploit. Brief success will almost always follow with brief failure lol. The only option I have found is that a combination of regulation of large numbers and regulation of averages (not typical down) and with that said, I will depart and get back to the grind. My apologies for the distraction. You are missing a point from the probabilities; think about the following scenarios:
1. EURUSD has moved up by 20 pips since the day open; what is the prospect of the price going up or down? is 50/50
2. EURUSD has moved upward by 150 pips since the day open; what is the prospect of the price going up or down then? It is certainly NOT 50/50

probabilities change over time; just like the roullette' probabilities change following a very long number of plays (refer to CP's article on roullettes)

the purpose would be to recognize an edge. In the case by Alphaomega egy; we utilize statistical edge. We calculate the average daily range; and enter when the price has drained its daily movement (measured from the ADR)

[vuxxesvesS]

quote you are missing a point in the probabilities; think about the following scenarios: 1 ). EURUSD has moved up by 20 pips because the day open; what is the prospect of the price going down or up? is 50/50 2. EURUSD has moved up by 150 pips because the day open; what is the prospect of the price going down or up then? It has certainly NOT 50/50 probabilities change over time; like the roullette' probabilities change following a long number of plays (refer to CP's article on roullettes) the purpose is to recognize an edge. In the example... Some folks will argue that this is a classic instance of https://en.wikipedia.org/wiki/Gambler's_fallacy

But I am not completely confident about the validity of the theory in the context of trading.

[TORDUTEsRDA]

quote Some folks will argue that this is a classic instance of https://en.wikipedia.org/wiki/Gambler's_fallacy But I'm not completely convinced about the validity of the theory in the context of trading. That is the beauty of Forex compared to volatility; it will have more rubber ring effect. EUR/USD for example; not doubles in value; nor drops 50% of its worth. It will stay within a reasonable value for quite a long time.

Compare this using SP price, or Facebook stock price; that will go upward with time.

A Forex pair; is already a pair of 2 currencies; (EUR, and USD), you are trading the difference (aka the spread, in pairs trading language ). Statistically; you do have a border already; it will mean revert over fashion.

You just need to er for mean ramble from time to time; due to macroeconomic/news events. During these times; stay aside if you aren't in; or exit if you are in a position.

[Y]

quote How is it possible your average profitable commerce, with a lotsize of 0.01, is $11.64 along with your losing commerce - $15.48 In general, the width of a commerce will be 25% to 50% of the daily range. That means, with your results, you get a daily range of 232 or something like this. However, in reality the daily range is a lot smaller. For eurusd that the ADR = 80 pips. Thus, profitable trades should be between $2 and $4 on average. You're correct,

except you have missed the part, of that being a multi currency back evaluation for 3 pairs at the same period (EURUSD,USDJPY,USDCHF). . .which should describe your queries. https://www.forexforum.co.za/attachments/1529311173.png

[TORDUTEsRDA]

quote you're missing a point in the probabilities; think about the following scenarios: 1 ). EURUSD has moved up by 20 pips since the day open; what is the chance of the price going up or down? is 50/50 2. EURUSD has moved upward by 150 pips since the day open; what is the chance of the price going up or down then? It has certainly NOT 50/50 probabilities change over time; like the roullette' probabilities change following a very long number of plays (refer to CP's article on roullettes) the point is to recognize an edge. From the case by Alphaomega egy;... correction to my previous remarks above;

I just did a statistical analysis on EUR/USD and GBP/USD; and found out that:

regardless of the current price in relation to the day open; the likelihood of the price moving in the exact same way; or retracing; is indeed 50/50

in other words; whether the market moved by 20 pips above the open; or 80 pips, or 100 pips; the likelihood of this market continuing in the exact same direction; or Placing; remain at 50/50.

The analysis I conducted is from 2015 thus far; using daily candles; and also using London session candles.

[EsSbes07]

quote Was that from Pythagoras? He had been one of the first traders of the famous Greek Drachme. Hello Riverstar,
Most importantly of all, sorry for not explain it clearly, and thank you that you have attempted to provide me a clue, but... it is not about pythagoras. My bad is not to read alpha articles clearly before I ask, so this leads to mistake... https://www.forexforum.co.za/attachments/1529311173.png... Trying to read and Understand the contents first, and then I will ask again if I find something not clear... Time is restricted at the moment, so cannot explain it much, hope you can understand it... https://www.forexforum.co.za/attachments/1529311173.png

[desvud]

quote correction to my previous comments above; I just did a statistical study on EUR/USD and GBP/USD; and found out that: regardless of their current price in relation to the day available; the probability of the price moving in the same direction; or retracing; is indeed 50/50 in other words; whether the market transferred by 20 pips above the open; or even 80 pips, or even 100 pips; the probability of the market continuing in the same direction; or reversing; stay at 50/50. The study I conducted is from 2015 to date; utilizing daily candles; and additionally using London session... Maybe you need to extend your statistical study to a couple more years back, because it is a little flawed in my opinion. If price travels 20 pips isn't the same with it traveling 40 pips and can be even different of 100 pips.
The distinction between them is a really thin line and if not looked at it attentively might sooner or later resemble Gamblers Fallacy.
The reversion to the mean or diverging away from the expression is really complex and should be treated as such.
There are simpler means of trading for people who don't posess very well established statistical, mathematical and trading understanding.

[esraxConto]

Hi All!

I'm not sure I knew this egy, nevertheless I will compose as I get it:
The heart of the egy is your assumption that prices have a tendency to reverse to mean price. Therefore most of the trades are profitable.
The heart of the issue with this egy is the bad days, when you open many trades and they all go to reduction, which make a very terrific loss.
But if you take off the greed from the game, rather than open too many trades on a single day, then you will continue to be profitable on most days, and also the bad days will not be so bad.
For instance, you can decide that on your very first trade of a day you risk only 1 percent of account, next trade another 1 percent, third commerce 1 percent and that is all for this day. On the worst day you will lose 3%. If there are lots of times of profit, this will not destroy your profitability.

Regards,
Avraham

[jttoNesaxresyresngoS]

Hi Avraham,
OP in the next egy is talking about just taking 2 trades:
buy on level 4 and 5 below moderate, sell on level 4 and 5 over moderate.
Stop losses on level 7 and 6.
So better with just 2 trades.

[SesCwSXDXD]

quote whether the market transferred by 20 pips over the open; or 80 pips, or 100 pips; the probability of the market continued in the same direction; or Placing; stay at 50/50. 100% true. I ran this test last year using 12 months worth of information crossing from 2016 into 2017 across all 9 timeframes (whatever highest MT4 candles can manage in their charting history per interval ) and across several 72 pairs conducting over 85Million calculations via a mql script that ran recursively for more than 5 days. I am able to say that. . .It's not just leadership but also fad...”Trade Small, Trade Frequently, Cut your Losses Brief, Hold Your wins just a small bit longer (through Law of Averages and huge Numbers) is the only'edge' I really could quantify out of the market.”

Perfect advice.

I would also add Trade What You See, Not What You Think.

[TORDUTEsRDA]

quote whether the market transferred by 20 pips above the open; or 80 pips, or 100 pips; the probability of the market continuing in exactly the exact same direction; or reversing; remain at 50/50. 100% true. I ran this test annually with 12 weeks worth of data spanning from 2016 into 2017 across all 9 timeframes (whatever highest MT4 candles can manage in their charting history per timeframe) and across several 72 pairs conducting over 85Million calculations by means of a mql script that ran recursively for over 5 days. I am able to say this. . .It's not just management but also fad... the reach of my study was limited to mean reversion of the daily range to the conclusion of the daily candle.

It doesn't mean there is not any advantage elsewhere. Keep searching https://www.forexforum.co.za/attachments/1529311173.png you are in the ideal direction

[desbuzgesrcesy]

quote You answered your own questions! Of course we want minimum range. This is part of the egy but I left the details for next posts. (I can not write long posts now) After all we attempt to ch just 50%(max) of the range during the first half of the day. So by way of example if we've range 5 pips it does not make sense to open position since the maximum possible profit is simply 2.5 pips. That is why in the second system layer I use sqrt(t) to find optimal entry points. I have this calculation in graphical/visual shape as well. I will... Can you share this file as well?

[osthor8878]

Been testing this vigorously for a few days and it always results in account blowing at any point. Unless the creator of the system has a way to mitigate a 1 way market this system won't ever work. I believe you can take some risk off with tailoring about news events, but that alone won't cut it.

The only option is to cap the rankings it takes I presume which may be tested if it had been an input in the EA..can you add that to the EA??

Appears like thread is dead so I will leave it at that.

[BureshuC]

Hello Alphaomega, if I'm not wrong you have substituted you profile picture right? Final time is Alpha and Omega sign. And I know you're a genius when you have a discussion with CP or perhaps when CP refer to a post, I do not remember exactly.

Okay I'm not a genius like you, therefore I believe it'll be considerably more time for me to grasp your lesson, but I'll try. Please be patient. . Https://www.forexforum.co.za/attachments/1529311188.jpg

Thank you for sharing, btw.

[vuxxesvesS]

Hello, and Thank you for stopping by!

Regardless if you are new or old member of the forum, keep reading here and that I promise you won't be disappointed!
From my standpoint this thread is the natural continuation of the thread Greater Edge within a Single Candlestick#8221; and here I intend to share with you some of my discoveries regarding this idea.

As I commented at the first thread, I believe that we may create and apply multiple egies only by using the data which is present within one candlestick.
However I would like to distance myself from the candlestick for a tool simply because we don't need candlesticks. I think they are only unnecessary distraction.
We are going to concentrate on the raw information.
That's why I need to concentrate and to attract your attention the idea of the organic trading cycles. Mainly the daily cycle also to some extend the weekly routine.

Later in the thread I will try to spell out the connections between time and price which exist within every trading cycle. These associations are the foundation of the egy which you're going to find out in this thread.

So, let's get started!

First when we would like to have clear understanding, we must define the main terms.

Time! All times in this thread are based on GMT 2. This really is my time zone and also the unofficial time zone where we determine the start and the end of every day on the Forex market.

The majority of the respectable brokers utilize GMT 2 in their own servers. So 00:00 on GMT 2 is just at the center of the most inactive period. (After US near and before Asia open) Here is the onset of the daily candle.

What is trading cycle? It is very straightforward. The trading cycle constitutes a fixed time period through which we've largely uninterrupted trading action. Each bicycle is separated from another cycles by a time period with very low or no trading action.
On the Forex market we've only 2 natural bicycles. Daily and Weekly.
The daily cycle begins at 01:00 and ends at 23:00 daily.
The weekly cycle begins Monday at 01:00 and ends Friday at 23:00.
Within our egy we are looking at every cycle as independent occasion!

Low and high. When I say high or low, I mean the highest or the lowest price of the current cycle.
Range. The range is simply (high #8211; low) for the current cycle.
Mid - this really is actually the center of the range. Or, mid=large -(range*0.5); Or (high low)/2;
sqrt(t) - This really is actually the square root of time. For now we don't need this. But we are going to utilize this calculation later in the next layer of the egy. (Where we add a few more complied optimizations).

So let's get down to the basics of the egy. I utilize the daily cycle, but you can use the same rules to the weekly.
First we make the frame. For simplicity in this example we suppose that the cycle begins and ends at 00:00.

So let's envision a rectangular flat airplane.
The vertical dimension is a variable and it's dependent on the price. (The range)
The horizontal dimension is adjusted and in our example is equivalent to 24 hours.
With this airplane we always track the loion (the coordinates) of their current price, the high, the low, and also the center.
Here you can see one very common example of completed daily cycle.
Https://www.forexforum.co.za/attachments/15286830302139010874.jpg
Notice that we also track the loion of the current time in relation to the mid cycle. In the base version we utilize 12:00. Later if we apply the next layer of the machine we can shift this value forward or back in order to maximize the egy.
The loion of the center of the cycle in part determines the aggressiveness of the egy. The farther away it's from the start - the higher the risk. From this will emerge all kinds of impliions concerning the probability distributions. (I will explain the mechanisms after )

Now let's see how we could utilize this info. Remember that later we can alter a few of the parameters to get superior optimization but the main structure of the system always remains the same!

Here are the basic trading rules. I explain only for SELL position. The BUY is the same but inverted.

We split each position into multiple components. The positions are build using inverted pyramidal structure. We construct the position by scaling in UP TO the highest size. (Not at the top of the max ). The maximum is dependent upon account size, risk appetite and a few other things.

1. First sign. (If there's absolutely no open position)
We SELL 1 unit when the current price is equal to the maximum price for the current cycle AND the current time is below the mid cycle. (In our example earlier 12:00)

2. Secondary signal. (Position buildup ).
If the current price is over the former entrance price X, then we add 2 components.
X is a variable which we decide with optimization. As a standard from the initial layer we could use 10 percent ADR. In the next layer we could put in nonlinear calculation together with sqrt(t). But for now we don't need this. You only have to comprehend the basic structure.
So with this particular system we construct inverted pyramid.
First open 1
If the price is over 1 X then we add 2.
If the price is over 2 X then we add 3.
We can keep adding till we reach the highest position size. 1 2 3 4 5....

3. Position Close.
If we have open position and the current time is prior to the mid cycle (12:00), then we look for correction into the mid range. (50% retracement in the large )
If the current time is later 12.00, then we look for 25% retracement in the high.
In the next layer we are going to add more precise and constant calculation utilizing nonlinear formula. For now it's not vital.
Whatever the outcome during the trading cycle, the ALL positions are closed in the end of the cycle. I our illuion at 00:00 or in 23:00.
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Ok. This is the foundation of the egy! Even with these basic rules, this egy will generate at least 85-90% profitable days. Or 9 out of 10. Average RR on trade by trade basis is over 1:1,5 (or closer to 2) and win% is over 60 percent for certain.

But when we put in the next layer with optimizations and much more precise calculation we could bring the achievement rate up to 98% profitable days.

Here you may also download the indior which tracks the cycles. It is very useful tool for visual/manual backtesting. At least I use it a lot.
Https://www.forexforum.co.za/attachments/1528683031798654550.ex4
Who knows, if you dig deep enough, maybe you will discover another secret egies based on a single candlestick. Https://www.forexforum.co.za/attachments/1528683018.jpg like I said there are at least 2 more.
Https://www.forexforum.co.za/attachments/15286830331672139893.jpg

You can expect more details in the upcoming posts. (When I've got time).
And I promise you that when I finish with this particular thread, everybody reading this will have the chance to earn money with this system! https://www.forexforum.co.za/attachments/1528683020.jpg