- This topic has 51 replies, 11 voices, and was last updated 11 years, 5 months ago by
.
- Posts
actually there is a pending bottom zone if you consider h var or if u use a larger h. also there is a few of us who traded this way well before J even joined FF. hebsibah being one i remember that was vocal about it. to us this was a proper high probablility pattern. if your saying this is not a proper pattern based on “A delicate secret” as applied to the tz concept i would have to agree. on a side note I do tend to mix other methods that are related to tz for confirmation and i have spoke about them on my thread @ http://www.stevehopwoodforex.com/phpBB3/viewtopic.php?f=6&t=3880. if i need to add a disclaimer to all my calls i can or you can remove my posts i don’t mind. its just on ff the Buried Treasure thread seemed a safe place to post even if it wasn’t one strict particular school of thought.
No its absolutely fine. You seems to know what you are doing
There are no correct ways to trade TZs other than the way that works for you. If it works, then thats all that matters
Please don’t take it the wrong way. I didn’t know if you were new to TZs or not so just thought I should chime in. I am no expert either, it will probably take me a year or maybe even more to properly understand the probabilities associated with TZs. I take more of a mathematical view to trading with TZs and that doesn’t mean “guestimating” or intuition based trading isn’t any worse, could even be better. Please keep making your trade calls and feel free to open up your own trading journal thread (http://penguintraders.com/forums/forum/trading-journals/) just to keep it all in one place. I will certainly follow and try to learn something new
Focus, Patience, Determination & Order in chaos
Been getting my treasure looted today. FOMC meeting had me thrown around a bit. My trade probabilities have not been as nearly as high as i originally thought and are in reality around 65-70%, which is no where near 90%+ but with proper risk management, that is more than enough to make many pips. I took losses on 9 set ups in a row(2 trades were on same setup) this is what led me to reevaluate my probabilities and I found that compounding any probabilities gives us a very skewed view of what is happening and after testing the past couple weeks I have found that the probabilities it will give us are flawed in a sense. So after not compounding any probabilities my TPs have a 65-70% chance of being hit instead of my SLs when i enter the market.
I am going to let my open trades(currently in 6) run till the markets close for the holidays and then will be starting 2015 with a new account to begin the year fresh. It will be interesting to see where my buried treasure balance ends up as all the trades close out. In the meantime i have been working one some more spread sheets in relation to risk manage I thought every one might want to have. They are just things to think about when examining what you can expect from your system based on winrate , risk per trade ,etc.
Loss Expectancy(Link)
Win Expectancy(Link)
Risk:Reward & Win Rate To Break Even(Link)
Return Required To Break Even(Link)
Compounding Losses(Link)
Compounding Wins(Link)
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!Thank you for the tables Pip.
I will borrow it to study.
Bu can i ask you why Using 1:5 has lower Compounding Wins than Using 1:2
Thank you for the tables Pip. I will borrow it to study. Bu can i ask you why Using 1:5 has lower Compounding Wins than Using 1:2
It is 1:1.5. so risking 3% for 4.5% instead of 3% for 6% is this what you mean?
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!lets say your win rate is 80%
if you were to wait till your logic loses 4 times in a row before making a real entry how much higher would that turn the 80. i would imagine the entries may be to rare vs the amount of work you would have to do unless it was in an ea. in the highly unlikely event of seeing 11 losses in a row i guess the next trade would be close to 100%“I believe the very best money is made at the market turns. Everyone says you get killed trying to pick tops and bottoms and you make all
your money by playing the trend in the middle. Well for twelve years I have been missing the meat in the middle but I have made a lot of
money at tops and bottoms.”
– Paul Tudor Joneslets say your win rate is 80% if you were to wait till your logic loses 4 times in a row before making a real entry how much higher would that turn the 80. i would imagine the entries may be to rare vs the amount of work you would have to do. in the highly unlikely event of seeing 11 losses in a row i guess the next trade would be close to 100%
I am sorry I am little confused on what you are asking?
if your win rate is truly 80 you will never see more than 11 losses in a row in a 1000 trade sample so are you saying if this did happen load the boat on the 12th trade? if so i like your style
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!Whoop thank you for showing me I correct and re upload, should be 1:1.5
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!I’m also starting to think a bit differently about TZs now. Have you noticed how about 50% of the zones were cleared right after the first bar?
This means, right off the bat, we lose 50% of the RZ%. So lets say we had a total of 1000RZs and 50TZs. And if are to take a trade after 2 bars have passed from the pending zone bar, then the count of RZs is now 500RZs vs 50TZs. 95% probability of the zone being cleared now dropped to 90% and it keeps decreasing in that manner. Usually I tend to take trades after at least 10-20 bars have passed which reduces the probability by about 90%!
This is why I started to become a bit skeptical about it today. What we really have are just fractals of H length in size and they don’t wait for the H_Right to complete, so we see the possible fractal formation. And as we increase the H_Right, the probability of price coming back to the zone increases towards 100%. But by that time, our account could be blown.
Also I have been thinking about the SL and TP probability calculations that we talked about. I don’t think it’s correct because if it is correct, then the probabilities needs to add up to 100%. When we are given a top pTZ and a bottom pTZ, the highest probability is for only one of them to become RZ and not both. Most likely one of them will become RZ and the other will end up being a TZ. So it’s not possible to have two ~90% zones.
Anyways, it’s late. I will try to chat with you tomorrow if I see you around
Focus, Patience, Determination & Order in chaos
Loss Expectancy(Link)
Also don’t forget to take into account # of pips potential. That’s where things could get ugly and the probability would drop even more due to R:R.
For example, for GU H1, 80% of the price action following a pTZ made a maximum retracement of 30-150 pips before coming back to the zone. BUT the ones that reached 100-120pips were only 3%. In order to have an accurate comparison, I would need to find out the maximum retracements that were made by TZs and then compare that with the RZs. This could yield very accurate results I think.
For each setup that we want the probability of, we would need to get the number of time that it failed and the number of times it was successful. If not, I think it can be too much of a generalization and could be incorrect.
This made me think how the heck FX-Jay traded TZs successfully. It’s hard to imaging doing so without proper statistics. Maybe he was good at reading PA. He did tell me that he used currency strength indicator as well. Anyways, there is much more to TZs than I have the time for.. haha
Focus, Patience, Determination & Order in chaos
I’m also starting to think a bit differently about TZs now. Have you noticed how about 50% of the zones were cleared right after the first bar?
I agree we need to think of TZ differently. We need to remember we can not just trade one TZ or PTZ unless you were trading some sort of options strategy. I also think it is important for most of the PTZ to clear within the first few bars of H right as this just means the market is volatile.
When we are given a top pTZ and a bottom pTZ, the highest probability is for only one of them to become RZ and not both. Most likely one of them will become RZ and the other will end up being a TZ. So it’s not possible to have two ~90% zones.
This is what we should be taking advantage of. we to remember what Krpsa’s indi does is only one piece of the puzzle. the stats it gives are for each zone as it occurs one by one. It does not take into account when over laps what is going to happen.
-
This reply was modified 11 years, 6 months ago by .
-
This reply was modified 11 years, 6 months ago by .
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!compounding any probabilities
This is what we should be taking advantage of. we to remember what Krpsa’s indi does is only one piece of the puzzle. the stats it gives are for each zone as it occurs one by one. It does not take into account when over laps what is going to happen.
This is very important subject you are bringing out, firstly what is the correct way to compound probabilities? Especially for overlapping zones.
Yeah, it is vital to see the probabilities play out bar by bar. I discussed the matter with one former member and he discussed it with Fxjay, and the conclusion was to look at at every bar in every H scenario in multiple timeframes playing out. Figuring out how to accumulate all those probability stats is the first real step to progress further, me thinks.
compounding any probabilities This is what we should be taking advantage of. we to remember what Krpsa’s indi does is only one piece of the puzzle. the stats it gives are for each zone as it occurs one by one. It does not take into account when over laps what is going to happen.
This is very important subject you are bringing out, firstly what is the correct way to compound probabilities? Especially for overlapping zones. Yeah, it is vital to see the probabilities play out bar by bar. I discussed the matter with one former member and he discussed it with Fxjay, and the conclusion was to look at at every bar in every H scenario in multiple timeframes playing out. Figuring out how to accumulate all those probability stats is the first real step to progress further, me thinks.
There is no correct way to compound the probabilities, i believe the thinking behind it is flawed as if there are enough events you can always compound the odds to be 99%. we need to know what is going on probability wise on both sides of the martket, the key to get the actual probability of the trades is to not compound any of the probabilities you are working with.
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!So I have gone through all the 28 major currency pairs have found the probabilities for my setups and they are not nearly as good as I hoped or as compounding probabilities say they are(when i compound the probabilities I have get 99% when we do the rate of failure the numbers begin to look more realistic). Although these numbers are not nearly as good as Id hope they are still very tradable. Remember when the odds of success are against us, bet on the odds of failure :)
with proper MM and picking trades carefully these numbers are more than enough to be profitable.
Notice some of the 1 hour setups have less than a 30% chance of success… These are times you bet for the setup to fail.
As long as we maintain a winrate above 50% always using a risk reward greater than 1:1 we will be profitable. The key is to knowing the numbers you are working against.
After finding the real success rate of the setups I have been trading it is no wonder my account has been drawn down so much. Many of the trades I took, I really had better odds taking the opposite trade. My view of the true probabilties were obscured because I was compounding them before.
-
This reply was modified 11 years, 6 months ago by .
-
This reply was modified 11 years, 6 months ago by .
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!Once I have more time I will later look into smaller timeframes. I am interested to see how we could trade 5, 15 ,30 minute time frames as well.
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!Added 30M 15M set up probabilties for 28 major pairs
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!Added 30M 15M set up probabilties for 28 major pairs
Hi Pip, this is nice. May i know how you did the calculation? Which software do you use to get this result? Thanks
sorry I think some unwanted visitors are around this forum, doesn’t want to let them know my efforts and thoughts.
First is zippo lighter now what horse thing is opening a public group, I dun feel safe.
-
This reply was modified 11 years, 6 months ago by .
-
This reply was modified 11 years, 6 months ago by .
-
This reply was modified 11 years, 6 months ago by .
-
This reply was modified 11 years, 5 months ago by .
I only know I know nothing
Skype: learnalways@outlook.comHi Everybody, I’m running out of ideas in making (TZ + RS + SS) all into 1 single system. That’s why I’m posting this pic and maybe we all can come up with something to make it tradable. I thinking of attacking when a PTZ is formed only when an arrow came out to confirm the trade. But all this indicators I just changed the settings and the arrow(RecurrenceStatistic) repaints live. And if someone can solve the repainting issue.It would be great if someone could code an indicator displaying left side of PTZ (gray zone). Its actually Sciurus_recurrence_V1.7 but I would greatly prefer the source code. If anyone have the source code, could u kindly pls pm me, thx. Actually my thoughts are 1) CTZ (3% = rare event) 2) Gray Area signifies continuation of Trend 3) Arrow indicates confirmation trigger signal except it repaints live (moving away from TZ) Best Regards
Nice bro. I am preparing the same thing, some indicators into 1 system : modTZ, SnS, FxGT, ZZcount, CI, some other Level indicators, etc … etc… the modified TZ is based on kprsa’s one (with probability calculation based on his rule) + my understanding on TZ (i hope it’s true
) + alert on some rare events : 6bulls, 2 in a row F-TZ/R-TZ, CTZ without touching it, both win, etc …
This need database, so i am concentrating with MT4-NodeJs-Mysql first. I think we can do many things if the connection to database going smooth, including pattern of TRZ wings. I will post images later if i have finished it.There is no correct way to compound the probabilities, i believe the thinking behind it is flawed as if there are enough events you can always compound the odds to be 99%. we need to know what is going on probability wise on both sides of the martket, the key to get the actual probability of the trades is to not compound any of the probabilities you are working with.
Agree! This is just because those single events like PTZ / CTZ are not independent of each other within one chart. If they were independent of each other, we could find a compound probability simply by multiplying all single probabilities.
If we do not find a mathematically formal description of the correlation between those single events (which I doubt) we only can determine the compound probability experimentally, e.g. by some special tweak of a Recurrence Statistics indicator.
A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)
Added 30M 15M set up probabilties for 28 major pairs
Hi Pip, this is nice. May i know how you did the calculation? Which software do you use to get this result? Thanks
Hey smallcat these were done using a custom indi and then i created the chart from the data sample.
sorry it took me so long to respond. Been relaxing and staying off of the computer for the holidays. Since the break is ending next week though I will be much more active on here again. I have opened a new account linked on myfxbook that I will be trading with for all of 2015 using a strategy based on TZ/RZ. This account is going to be much more risk aware and will only be risking .5-1% per trade. I will regularly be posting updates here on how my trading is doing.
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!sorry I think some unwanted visitors are around this forum, doesn’t want to let them know my efforts and thoughts. First is zippo lighter now what horse thing is opening a public group, I dun feel safe.
I too do not feel comfortable sharing too much any more as I am unsure many unwanted visitors are lurking… This is why my ideas and sharings have become more discretionary.
-Life’s Good & Why Wouldn’t It Be? I’m a Pirate After All!Added 30M 15M set up probabilties for 28 major pairs
Hi Pip, this is nice. May i know how you did the calculation? Which software do you use to get this result? Thanks
Hey smallcat these were done using a custom indi and then i created the chart from the data sample. sorry it took me so long to respond. Been relaxing and staying off of the computer for the holidays. Since the break is ending next week though I will be much more active on here again. I have opened a new account linked on myfxbook that I will be trading with for all of 2015 using a strategy based on TZ/RZ. This account is going to be much more risk aware and will only be risking .5-1% per trade. I will regularly be posting updates here on how my trading is doing.
Happy New Year Pip. Nice to see you again, and may you have success in 2015 …
If we do not find a mathematically formal description…
You want to find a mathematically description? That’s easy even if you don’t have a clue how to do it :)
Symbolic Regression is the magic you need.Think about it as some kind of brute force attack on a password. Symbolic Regression uses different functions and combines them in many many different ways.
If there is a mathematically formular that can describe your problem, it will find it.-
This reply was modified 11 years, 6 months ago by
- You must be logged in to reply to this topic.