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Has someone tried GG suggestion using average ticks to detect a TZ? Where the amount of ticks is 150% higher than the average I think 4 or 5 bars?
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Another way to think of the mid-transient zone idea is in terms of a familiar and intuitive concept:
breakouts. The simple “Trading the Middle TZ’s” thread on ff has got me thinking about this: http://www.ff.com/showthread.php?t=529396 and it is clear from that thread that the idea can be easily and intuitively turned into a strategy or strategies.For a channel breakout you choose a channel length.Within the teaching of Eurusdd, this can be thought of as h, and in particular, h-left.For a breakout to be valid you may choose some minimum "breakout threshold" that price has to move above a previous channel high or below a previous channel low for the breakout to be valid. Price has to break out by K pips to be valid.Within Eurusdd’s teachings this can be thought of as K.According to the thread referenced above, when price closes at or above a
previous channel high + K pips, the thread OP places a buy trade (breakout buy). When price closes at or below aprevious channel low - K pips, the thread op places a sell trade (breakout sell).So
channels with a "breakout threshold"and mid-transient zones are really the same. In reality, Eurusdd just repackaged a channel with new terms and new types of visualizations.By the way, zig zags and channels are basically the same thing too but that’s another story.
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So maybe the clue lies in candlestick wicks?
I don’t believe that there is only one ‘clue’ when talking about our TZ hobby. But I absolutely agree that the best TZ based entries would be placed inside wicks. This is what I’m working on at the moment: define current swing momentum based on potential mid-bar zones formed, then look for entries into this swing inside potential fractal zones, usually inside a wick.
I think I’m close, really close …
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)
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When Eurusdd said you win if the zone becomes a TZ or not what he was saying is that we treat all PTZ as completed TZ and trade back towards the recurring prices above/below the forming zone.
Now how K plays into this I have no idea. Even when it’s explained I’m still a bit cloudy.“You are not guaranteed longs/Shorts. What you are guaranteed are re-visits. That is what you should trade!!! If you suspect a zone to be transient and price moves to a region which will then be recurrent, you can then trade the re-visits. But don’t try to buy when price hits the top of the suspect zone because the zone is still forming!!!
You do not know if a region is transient or recurrent yet because it is still forming. What you do though is wait. The moment price goes above that region; you can assume it is transient and then prices very close above it recurrent. Those prices are the ones you will expect a re-visit within at least one of the remaining h bars.
If price goes above a Zone before it is done forming, you can assume the zone is transient and the prices above it recurrent. Those prices are the ones you will expect to be re-visited, not the prices in the zone.”
eurusddThis reply has been reported for inappropriate content.
When Eurusdd said you win if the zone becomes a TZ or not what he was saying is that we treat all PTZ as completed TZ and trade back towards the recurring prices above/below the forming zone. Now how K plays into this I have no idea. Even when it’s explained I’m still a bit cloudy. “You are not guaranteed longs/Shorts. What you are guaranteed are re-visits. That is what you should trade!!! If you suspect a zone to be transient and price moves to a region which will then be recurrent, you can then trade the re-visits. But don’t try to buy when price hits the top of the suspect zone because the zone is still forming!!! You do not know if a region is transient or recurrent yet because it is still forming. What you do though is wait. The moment price goes above that region; you can assume it is transient and then prices very close above it recurrent. Those prices are the ones you will expect a re-visit within at least one of the remaining h bars. If price goes above a Zone before it is done forming, you can assume the zone is transient and the prices above it recurrent. Those prices are the ones you will expect to be re-visited, not the prices in the zone.” eurusdd
I think the “k” is outside the zone [+k , -k] that makes the area becomes recurrent …. the guaranteed re-visit recurrent area. May be “k” has relationship to the wick of bigger TF ?
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As to the thread “Trading the middle TZ’s”, I am curious how it will proceed into the future.
Few months ago, I have done something similar analysis and the result was not so bad.
With tweaking the risk:reward, the max profit I have got was +1.10422(=11042.2pips) with 69% winning ratio.
Sampled data is 5 years of EURUSD.
Attached picture 1 is its return and cumsum return.
If I want to avoid negative balance but maximize the profit, the result was +0.90380(=9038pips) with 59.8% winning ratio.
Attached picture 2 is its return and cumsum return.
So it is VERY VERY important to chose optimal risk:reward!
Otherwise we would be faced with huge negative balance like picture 3, even though the final profit is positive with 66.6% win.
Anyways, this is not what I am studying currently, and so I will not go further.
Back to the topic, what triggered me puzzled was when I read Northtraders post.
He pointed out that, whether or not the objected bar is already recurrent or potential transient, the probability of fully revisiting is the same.
And I have got the similar result. So I wondered why we trade only potential transient bars?
Then saver0 suggested new idea with taking account of k.
To me, this makes sense and this seems what EURUSDD said in the proposition 1.
Yes we can get >99%, and moreover if we use [h-left < h-right] like saver0 tested, then maybe we can get >99.9% (I have never tried h-left < h-right though theoretically we can).
The maximum I have got was 99.2% for EURUSD60min, 99.6% for EURUSD240min, and 99.6% for EURUSD1440min (only using h-left = h-right).
BUT do you bet you will be a millionaire before you blow up account?
Even if probability is >99% ?
I think we all know its danger.
I will never do that kind of trade with real account.
In the end, I think it is the problem of application or extension (as EURUSDD mentioned).
I think fx-jay does not use k but he showed good profit. (I have never considered his trade so I may be wrong)
So it is nothing wrong, no one is wrong. Everything depends on application.
And I am 100% stuck here. haha.
But found something interesting about DNA few weeks ago.
This is my current status.
Peace on Earth. 4 years has passed and I will never forget.
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Hi jimsterk,
If u don’t mind explaining your quantitative results in a more layman term, its abit complicated for me, hope u understand, so hopefully I can learn something useful for my trading.
Pls see attached pic. CrucialPoint pic on Multi-Dimensional Donchian Channel looks abit like Transient Zone h right extended ???
I only know I know nothing
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“Prices do not have to return back into the TZ zone. Since you assumed it is transient you are not selling with the intention of price returning into the zone. You are selling with the expectation that price will re-visit the area above the zone. The other possible option is, you will get more pips because price will not just visit the area above the zone but go down into it as well.
I am trading this microscopically on the 1min 5min timeframes… Once price is above my h bars, I label that zone a suspect transient zone and start looking for my SURE 1-10 pip short opportunity above it, assuming it is forming up…!! Reverse for longs…
Focus on the zone price is presently concerned with. The current price should guide you. The whole thing is simple. This and the DNA are the two tools one needs to develop revolution!”eurusdd
What is DNA???
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“Prices do not have to return back into the TZ zone. Since you assumed it is transient you are not selling with the intention of price returning into the zone. You are selling with the expectation that price will re-visit the area above the zone. The other possible option is, you will get more pips because price will not just visit the area above the zone but go down into it as well. I am trading this microscopically on the 1min 5min timeframes… Once price is above my h bars, I label that zone a suspect transient zone and start looking for my SURE 1-10 pip short opportunity above it, assuming it is forming up…!! Reverse for longs… Focus on the zone price is presently concerned with. The current price should guide you. The whole thing is simple. This and the DNA are the two tools one needs to develop revolution!” eurusdd What is DNA???
If we look at “ultimate truth” @FF, i think it is the DNA ?
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Hi LearnAlways,
do you have this Multi-Dimensional Donchian Channel indi in your arsenal ? If so do you mind posting it, please. I would like to try it
cheers
hannele
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Hi LearnAlways, do you have this Multi-Dimensional Donchian Channel indi in your arsenal ? If so do you mind posting it, please. I would like to try it
cheers hanneleHi hannele,
I do not have the indicator, I just took the pic from CrucialPoint post, but I believe it can be coded. The Multi-Dimensional Donchian Channel seems like a self adjusting donchian channel to me, I got modify a donchian channel with shift function myself though, but its definitely not as good as I’m not a coder, if u don’t mind I post this here instead, pardon me as my coding skills are really amateur.
Pls take note: I shift the Donchian Channel to the left instead of right because I don’t want the channel lines to obstruct the candlestick when its strongly trending as I like to see PA. Candlestick will stick to one side of the channel when strong trend starts.
I only know I know nothing
Skype: learnalways@outlook.comHas someone tried GG suggestion using average ticks to detect a TZ? Where the amount of ticks is 150% higher than the average I think 4 or 5 bars?
Hi muuh, can we use “Tick Volume” indicator for this? So, we compare current closed candle’s TV value with the average of 4 or 5 previous bars’ TV value. We can get the “absolut” (mathabs) value of each candle, so the negative TV value must be convert to positive value first, before we calculate its average.
May be this can help us to “predict turning point” using MA, CCI, etc too ??
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GG came up with the idea. I haven’t thought one minute about this.
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Dear Fellow Traders,
I have a few question that I would like to ask. I am new to the concept discussed, but it is one i am having trouble with. Now, after reading the Similarity thread and looking superficially into Eurusdd’s presentation on TZs, I am bothered by this… and please, for those who have grasped this, i apologize for noob questions… The reason I ask it here is because, I see many of you in this thread were also active in the original thread. I have finished reading the other day and its a lot to digest.
In one of the examples of RZs and TZs, there is an idea that if the price penetrates the Potential Zone, we can assume that it is Transient and that the area above it is Recurrent. (Please see image attached). The real problem i have with any application of this concept is that…when a potential zone appears, many times before it is declared either, it disappears and is recreated at another position, particularly on the lower tfs. Now, this makes it difficult to apply while zones are being created, however if you get the right H, most recurrent zones will be revisited…but hard to say when.
BTW, I was reading Kiads take on the zones and he posted an image of Arnold Schwarzenegger saying I’ll be back…just dont know when…LOLed and spilled coffee all over…. great humor.
Thank you in advance for a bit of clarity on this.
Best,
Michael E
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… The real problem i have with any application of this concept is that…when a potential zone appears, many times before it is declared either, it disappears and is recreated at another position, particularly on the lower tfs. Now, this makes it difficult to apply while zones are being created, however if you get the right H, most recurrent zones will be revisited…but hard to say when. …
I get the same problem. Now i am trying to trade on M5 instead of M1. We do not know when the time of revisit, so now i am trying to find the max DD that can be used as SL calculation.
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Hey Smallcat,
Higher TFs dont help that much IMO,try using a mt4 replay, and load the indicator on various timeframes…you can see potential zones develop, disappear on all tfs. I guess you could develop something if you used martingale with it,…otherwise you would be stuck in trades for a looooong time, or stopped out. The zone idea is interesting in ranging periods only.
This is in the event we try using them alone…however, combining it with, perhaps with Saver0’s basket indi may give you a rather interesting system? Use the indi to tell you when a pair is “out of sync”, and use the developed recurrent zones as targets in the expected direction.
What I am saying, is that I don’t see, at this point, a way to successfully trade from the zones as it was suggested…i see them as potential targets, to be used with other tools in the arsenal. Anyway, these are my noobie experiences and thoughts about it so far. Time to put on my thinking cap….
Best,
Michael EThis reply has been reported for inappropriate content.
Hey Smallcat, Higher TFs dont help that much IMO,try using a mt4 replay, and load the indicator on various timeframes…you can see potential zones develop, disappear on all tfs. I guess you could develop something if you used martingale with it,…otherwise you would be stuck in trades for a looooong time, or stopped out. The zone idea is interesting in ranging periods only. This is in the event we try using them alone…however, combining it with, perhaps with Saver0’s basket indi may give you a rather interesting system? Use the indi to tell you when a pair is “out of sync”, and use the developed recurrent zones as targets in the expected direction. What I am saying, is that I don’t see, at this point, a way to successfully trade from the zones as it was suggested…i see them as potential targets, to be used with other tools in the arsenal. Anyway, these are my noobie experiences and thoughts about it so far. Time to put on my thinking cap…. Best, Michael E
Thanks mate. About “MT4 replay”, do you mean this “trading simulator” link? http://www.forexfactory.com/showthread.php?p=1856969
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Hey,
Anything that will replay, that one looks fine. The one I have is LFH trading simulator.
Best,
Michael E
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Hey, Anything that will replay, that one looks fine. The one I have is LFH trading simulator. Best, Michael E
Thanks mate. I will try version 3 of LFH.
Let me try to clarify for you @Edington
There are 3 types of zones
1) (PZ) Potential Zone (that can be either RZ or TZ)
2) (RZ) Recurrent Zone
3) (TZ) Transient ZoneWhat you are betting on is a zone becoming recurrent. Almost all indicators that were made for this method only shows TZ (the failed zone, the one that failed to become recurrent). This is why Zones disappear from the chart because they became recurrent.
And then there are two ways to trade PZs. You can counter trade it (what EURUSDD taught), or you can trend trade it. Each gives different probabilities. Pretty much what you will find is, smaller the TP (for counter trend), higher the probability (this is the K in the formula, the TP).
Then there is the extremely high probability trading with PZs. This is when you have multiple PZs on the chart because the chance of having 2 consecutive TZs is extremely small. So you can trade the newest PZs and bet that the PZ will become a RZ with a much higher probability. This is the grail part of this system
Let me know if you don’t understand something. Better to show a screenshot and write stuff down so I can try to explain it on the screenshot.
Focus, Patience, Determination & Order in chaos
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Let me try to clarify for you @Edington There are 3 types of zones 1) (PZ) Potential Zone (that can be either RZ or TZ) 2) (RZ) Recurrent Zone 3) (TZ) Transient Zone What you are betting on is a zone becoming recurrent. Almost all indicators that were made for this method only shows TZ (the failed zone, the one that failed to become recurrent). This is why Zones disappear from the chart because they became recurrent. And then there are two ways to trade PZs. You can counter trade it (what EURUSDD taught), or you can trend trade it. Each gives different probabilities. Pretty much what you will find is, smaller the TP (for counter trend), higher the probability (this is the K in the formula, the TP). Then there is the extremely high probability trading with PZs. This is when you have multiple PZs on the chart because the chance of having 2 consecutive TZs is extremely small. So you can trade the newest PZs and bet that the PZ will become a RZ with a much higher probability. This is the grail part of this system
Let me know if you don’t understand something. Better to show a screenshot and write stuff down so I can try to explain it on the screenshot.A very nice and brief explanation of the whole thing. Thanks Saver
For the first 2 months of this year I tried MTZ (middle TZ) trend trading. I didn’t measure but the success rate was quite low.
Now, in light of this new explanation + 1 pip approach…. I can see some real merit in FX. (Volume can also be added in many ways). I will go real soon but first I’ll need to find a small spread broker. No suggestions in this thread please. Thanks…
Best regards…
Nothing has ever motivated me more than this...
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Dear Saver0,
Thank you for a very good explanation of the zones. The way to trade them was what was troubling me the most. I will try implementing these trade ideas in the weeks to come.
Best,
M Edington
Let me try to clarify for you @Edington There are 3 types of zones 1) (PZ) Potential Zone (that can be either RZ or TZ) 2) (RZ) Recurrent Zone 3) (TZ) Transient Zone What you are betting on is a zone becoming recurrent. Almost all indicators that were made for this method only shows TZ (the failed zone, the one that failed to become recurrent). This is why Zones disappear from the chart because they became recurrent. And then there are two ways to trade PZs. You can counter trade it (what EURUSDD taught), or you can trend trade it. Each gives different probabilities. Pretty much what you will find is, smaller the TP (for counter trend), higher the probability (this is the K in the formula, the TP). Then there is the extremely high probability trading with PZs. This is when you have multiple PZs on the chart because the chance of having 2 consecutive TZs is extremely small. So you can trade the newest PZs and bet that the PZ will become a RZ with a much higher probability. This is the grail part of this system
Let me know if you don’t understand something. Better to show a screenshot and write stuff down so I can try to explain it on the screenshot.Thanks a lot bro. This is the one i am looking for.
One is not so clear to me, they are the FPTZs or MPTZs or both ?
cheers hannele
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