Al Brooks ideas - Possible to code?

[NoDoji]

Quote from Wulfrede:

Basically, Brooks has a way to what I call, "tokenize", the price stream into meaningful, discrete blocks which comprise micro and macro contexts. It isn't really that his methods work or don't work per se. Meaning, that's not the actual point. Brooks aims to give you a way to view the market in a concrete fashion which allows you to assign probabilities to future outcomes. As long as you let probabilities work in your favor, you'll be ok.

Hi Wulf!

Your comments above nail the Brooks approach.

"Bar by bar" doesn't mean that every bar signals a potential trade, nor does it mean every bar has importance to the price action tactics you choose to incorporate into your plan.

It's the concepts that matter.

For example, Brooks talks about "barb wire" which is back to back dojis in your chosen time frame (his TF is the 5min chart). He makes the point that a doji is nothing more than a range in a smaller time frame. That concept is really important. Are you trading ranges in smaller time frames? If not, then back to back dojis mean there is no trade awaiting you at that moment. If you are, then would you trade the first break out of a range or would you watch price react to the break and then trade based on whether the breakout was strong , weak, or a total failure (1 or 2 ticks before retracing back into the range)?

I will not provide any set of rules to code. I've already provided basic rules for a 1min 20EMA tactic in another thread. You can code that easily and you can tweak the management rules based on the instrument traded and the sort of trading you do.

 

[wrbtrader]

Quote from gmst:

...Basic rules - so that one of us can probably code it to see if it has value. Or do the rules involve a lot of discretion?

Some discretion is involved. Therefore, the method can not be coded. Thus, the method is "dependent" upon you to manually (discretionary) apply it.

Another way to look at it...each trader will apply the method differently in comparison to another trader due to the trader's own perception, trading experience, discipline and so on.

Yet, the method does involve an indicator called price moving average. I'm sure you can code that aspect of the method to help you make "discretionary analysis" in the other areas of Al Brooks methodology.

 

[cornix]

Brooks doesn't provide exact set of rules, but general ideas give good clues on what to look for. And with some persistence one can test various sets of rules applied to those concepts, eventually finding successful.

Now automation is what I also started to think about lately, but not any close so far.

 

[dom993]

Brooks doesn't provide exact set of rules

I feel like he is providing a dozen rules a page - granted, I have never been able to go past page 100 (or so) of his 1st book, may be the rest of it just rehashes the same rules?

Anyway - if I remember correctly, he uses trendline breaks & overshoots a lot in his various explanations/rules - micro-trendlines & "regular" ones. Micro-trendlines might be easy to program (they are based on small number of bars), regular trendlines are much more of a pain.

Anyway, to program something, you need to first have a very clear model - aka specification. For sure his 1st book doesn't provide that very clear model, you'll have to either create it by studying the book (many times over I suspect), or may-be read his 3 later books which hopefully do a better job in this area.

 

[cornix]

Quote from dom993:

I feel like he is providing a dozen rules a page - granted, I have never been able to go past page 100 (or so) of his 1st book, may be the rest of it just rehashes the same rules?

Anyway - if I remember correctly, he uses trendline breaks & overshoots a lot in his various explanations/rules - micro-trendlines & "regular" ones. Micro-trendlines might be easy to program (they are based on small number of bars), regular trendlines are much more of a pain.

Anyway, to program something, you need to first have a very clear model - aka specification. For sure his 1st book doesn't provide that very clear model, you'll have to either create it by studying the book (many times over I suspect), or may-be read his 3 later books which hopefully do a better job in this area.

Right, no models in the book. And language is horrible. But he provides a goot overview of how price action can be analyzed in general, productive food for thought.

No substitute for personal efforts, but useful basis.

 

[Wulfrede]

The language is not any worse than in any other textbook. In fact, often it is very evident that Brooks put a lot of thought into how to phrase a non-trivial concept. Open a Calculus text and read a chapter. Not exactly night-time reading. Requires a serious effort figure it out, doesn't it?

Brooks texts are not to be read. They are to be studied. I think the man has done a great service to traders truly serious about their careers. Fortunately to some, he will be ignored by most, as all things requiring persistence and elbow grease.

/Wulfrede

 

[gmst]

Quote from dom993:

I feel like he is providing a dozen rules a page - granted, I have never been able to go past page 100 (or so) of his 1st book, may be the rest of it just rehashes the same rules?

Anyway - if I remember correctly, he uses trendline breaks & overshoots a lot in his various explanations/rules - micro-trendlines & "regular" ones. Micro-trendlines might be easy to program (they are based on small number of bars), regular trendlines are much more of a pain.

Anyway, to program something, you need to first have a very clear model - aka specification. For sure his 1st book doesn't provide that very clear model, you'll have to either create it by studying the book (many times over I suspect), or may-be read his 3 later books which hopefully do a better job in this area.

Hey, personally did you find his ideas helpful in your trading? Others have already indicated that they have found value in Brook's teachings, however it will be interesting to hear if you have been able to make use of it - since you are completely automated, your response will be valuable. Thanks.

 

[gmst]

Quote from Wulfrede:

The language is not any worse than in any other textbook. In fact, often it is very evident that Brooks put a lot of thought into how to phrase a non-trivial concept. Open a Calculus text and read a chapter. Not exactly night-time reading. Requires a serious effort figure it out, doesn't it?

Brooks texts are not to be read. They are to be studied. I think the man has done a great service to traders truly serious about their careers. Fortunately to some, he will be ignored by most, as all things requiring persistence and elbow grease.

/Wulfrede

Useful information. Thanks. The way you have put it - it seems it all depends on the kind of approach one takes towards studying his material. One can't be laidback, rather has to work his way through his material.

Let me ask you these:
1) Is Brook's material similar in toughness to Crabel's material?
2) How your trading would have been had you not been exposed to Brook's idea? I want to assess through this question - how much actual impact Brook's ideas have made on your trading performance and results. Because it is clear that reading his stuff is serious work. Thanks for the tips.

 

[gmst]

Quote from wrbtrader:

Some discretion is involved. Therefore, the method can not be coded. Thus, the method is "dependent" upon you to manually (discretionary) apply it.

Another way to look at it...each trader will apply the method differently in comparison to another trader due to the trader's own perception, trading experience, discipline and so on.

Yet, the method does involve an indicator called price moving average. I'm sure you can code that aspect of the method to help you make "discretionary analysis" in the other areas of Al Brooks methodology.

Thanks for your comment. I get a sense that reading his books would be like reading an approach and some building blocks along the way.

Would you say that his book is similar in design (not writing style) to Mark Fischer ACD book?

 

[dom993]

Quote from gmst:

Hey, personally did you find his ideas helpful in your trading? Others have already indicated that they have found value in Brook's teachings, however it will be interesting to hear if you have been able to make use of it - since you are completely automated, your response will be valuable. Thanks.

The short answer is : no, I didn't find anything helpful for my trading in the 100 pages that I read.