A Bill Williams fractal high - Would you buy or sell?

[tomorton]

Fractals are not of great interest to many traders. They're the simplest pattern: Bill Williams used them to generate a buy signal. His fractal high comprises 5 bars, of which the middle one has the highest high, while the two before and the two after have lower highs. He taught (and traded) that you buy when price rises to breach the high of the middle bar.

But it seems his message has been perverted over the years. Many traders regard a fractal high as a sell signal, and you sell at the close of the 5th bar. They still call it a Bill Williams fractal and they still credit him for the strategy. But its the opposite of what he actually said.

I don't know who started this.

Which way would you trade it?

 

[maxinger]

I use my own terminology.


The price goes up.
Price retraces (some people call that oscillates) down.
At the end of the retracement, press the BUY button after 1, 2, or a few candlesticks / bars.


and vice versa.

Of course, in the real world, things are not that straightforward.
So I use Intermarket correlation to improve the win rate.


I can't answer your question as the bigger picture was not presented.

 

[SunTrader]

A fractal by itself is not enough for me to put a trade on.

 

[tomorton]

A fractal by itself is not enough for me to put a trade on.

Well, Williams himself did add indicators using a series of MA's to confirm trend. These raised the probabilities of the trades taken I'm sure. But they never were enough to reverse the trade direction.

 

[SunTrader]

Well, Williams himself did add indicators using a series of MA's to confirm trend. These raised the probabilities of the trades taken I'm sure. But they never were enough to reverse the trade direction.

For me personally, HL's = uptrend, LH's = downtrend, MA's = GIGO. To each their own.

 

[murray t turtle]

Fractals are not of great interest to many traders. They're the simplest pattern: Bill Williams used them to generate a buy signal. His fractal high comprises 5 bars, of which the middle one has the highest high, while the two before and the two after have lower highs. He taught (and traded) that you buy when price rises to breach the high of the middle bar.

But it seems his message has been perverted over the years. Many traders regard a fractal high as a sell signal, and you sell at the close of the 5th bar. They still call it a Bill Williams fractal and they still credit him for the strategy. But its the opposite of what he actually said.

I don't know who started this.

Which way would you trade it?

%%
MAINLY depends on the context+ market + main trend.
WOULD i buy + sell that pattern, or sell + buy it??
NOT a buy in a bear market, monthly chart, on that exact pattern. Or sell on that exact monthly pattern, in a bull or bear market.
I can think of several markets where we would want to ignore that pattern[with ma]; but some markets it may still work.
I'm thinking of something, that really depends on the specific market, more than any five bars@ all.
Looks like it could still work in Real Estate, monthly data, even for those who never hear of BW.

 

[easymon1]

His fractal high comprises 5 bars, of which the middle one has the highest high, while the two before and the two after have lower highs. He taught (and traded) that you buy when price rises to breach the high of the middle bar.

Do you have the source documentation that BW published to nail down his method as presented, with precision?
If not, then you are left to generate some stats to at least get a quick and dirty comparison of the permutations that exist 'out there'.
Do stats?
Well yeah, unless you can get your momma to do em for you. Got any kids, grandkids, neices, nephews that you can get to run stats for you for $1 per documented screenshot? Sit em down over the holidays and hook em up with a spreadsheed to fill in, show em what you want. Buy your stats by the dozen, lol.
They can prolly throw together a school report somewhere along the line.
https://www.dogpile.com/serp?q=trader+bill+williams+fractal+trading+method

 

[TrAndy2022]

A study here about Bill Williams approach.

ABSTRACT
Prediction of stock price and modelling of market pattern are quite difficult and complex to understand itself. There are hidden factors of market like effect of news, sentiment of crowd etc. which play an important role of modelling the market pattern. The modelling of market patterns was primarily developed by R.N. Elliott. The Elliott Wave theory was described subjectively in literature and wave patterns cannot be identify easily. In this work, we mainly focus on identification of wave pattern through Fractal indicators and Awesome Oscillator using R programming.

 

[tomorton]

Do you have the source documentation that BW published to nail down his method as presented, with precision?
If not, then you are left to generate some stats to at least get a quick and dirty comparison of the permutations that exist 'out there'.
Do stats?
Well yeah, unless you can get your momma to do em for you. Got any kids, grandkids, neices, nephews that you can get to run stats for you for $1 per documented screenshot? Sit em down over the holidays and hook em up with a spreadsheed to fill in, show em what you want. Buy your stats by the dozen, lol.
They can prolly throw together a school report somewhere along the line.
https://www.dogpile.com/serp?q=trader+bill+williams+fractal+trading+method

Sure.

See

Skip to about 36:00.

 

[easymon1]

Sure? Sure what. I have my methods statted well before i trade them.
I've always assumed you do too, Tom. No?

This looks to be from an oldschool trader and said to be a classic setup.
yawn.
lol, so you askin about it. so I'm tellin you how a rules based trader could go about answering his own question.
-
So "sure" what. Pls excuse me if i don't waste time on your youtube find, wanna encapsulate its message for us?

Looks like your boy has three sections to go with his classic samwich.
I'm down the road, later gator, lol.