So, at this time, I would summarize everything by saying that generally, I want to trade in the direction of the six-hour baseline; but that this is going to be within the context of the six-hour price range, and will also be limited and directed by the trajectory AND the price range of the 2½-hour measure; which will in turn be influenced and impacted by the slope and price range of the 90-minute measure. ALL of these factors must be considered in light of and in relation to one another.
Duxon's Archive
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So, at this time, I would summarize everything by saying that generally, I want to trade in the direction of the six-hour baseline; but that this is going to be within the context of the six-hour price range, and will also be limited and directed by the trajectory AND the price range of the 2½-hour measure; which will in turn be influenced and impacted by the slope and price range of the 90-minute measure. ALL of these factors must be considered in light of and in relation to one another.
Entry levels (i.e., trade opportunities) are likely to be found by monitoring pullbacks to the 34-minute price range at 0.15% deviation or pullbacks in the 34-minute baseline itself, along with pullbacks to the nine-minute price range at 0.04% deviation or pullbacks in the nine-minute baseline itself.
Numerical Price Prediction (NPP) Update
Copyright © 2021 Fred Duckworth
Post #611 is a description of NPP, where I stated that the system was developed based on five biblical principles, which I listed there.
I also wrote that the main idea behind this approach is to gather and evaluate precise, up-to-date, quantitative data and use it to calculate the odds of price reaching designated values within a given time period by patterning the system's elements after the equations, wave functions, and computer models used in numerical weather prediction.
At that time, as is still true today, the system incorporated the idea of cycle theory, which holds that cyclical forces, both long and short, drive price movements, and can be used to anticipate turning points. It is also compatible with Edgar Peters' fractal market hypothesis, which views financial markets as fractal in the sense that they follow cyclical and replicable patterns—ones consisting of fragmented shapes that break down into parts which then replicate the shape of the whole.
However, to trade with the clarity and precision I desired required me to do something I did not see mentioned by Peters, or J.M. Hurst, nor anyone else, which was to assign a specific temporal value to each individual measure plotted on my charts.
After that, their emerged yet another aspect to interpreting price action that proved deserving of my consideration which I had not envisioned at all—the concept of "temporal support and resistance."
That was it. That was NPP in its totality. However, beginning next week, I plan to introduce another preexisting concept—the idea of range trading, which is to say, identifying the range between which I plan to buy or sell over a given period of time. I kind of do this already, but I intend to make it my primary focus going forward, which was not the case previously.
This is not to be confused with range-bound trading, since I plan to do this in a way that is dynamic and can be applied to both consolidating or trending markets. I believe that there is a good chance this will eventually lead to very few trades that garner only a few pips profit, with most resulting in returns of perhaps 20 to 100 pips each.
Copyright © 2021 Fred Duckworth
Post #611 is a description of NPP, where I stated that the system was developed based on five biblical principles, which I listed there.
I also wrote that the main idea behind this approach is to gather and evaluate precise, up-to-date, quantitative data and use it to calculate the odds of price reaching designated values within a given time period by patterning the system's elements after the equations, wave functions, and computer models used in numerical weather prediction.
At that time, as is still true today, the system incorporated the idea of cycle theory, which holds that cyclical forces, both long and short, drive price movements, and can be used to anticipate turning points. It is also compatible with Edgar Peters' fractal market hypothesis, which views financial markets as fractal in the sense that they follow cyclical and replicable patterns—ones consisting of fragmented shapes that break down into parts which then replicate the shape of the whole.
However, to trade with the clarity and precision I desired required me to do something I did not see mentioned by Peters, or J.M. Hurst, nor anyone else, which was to assign a specific temporal value to each individual measure plotted on my charts.
After that, their emerged yet another aspect to interpreting price action that proved deserving of my consideration which I had not envisioned at all—the concept of "temporal support and resistance."
That was it. That was NPP in its totality. However, beginning next week, I plan to introduce another preexisting concept—the idea of range trading, which is to say, identifying the range between which I plan to buy or sell over a given period of time. I kind of do this already, but I intend to make it my primary focus going forward, which was not the case previously.
This is not to be confused with range-bound trading, since I plan to do this in a way that is dynamic and can be applied to both consolidating or trending markets. I believe that there is a good chance this will eventually lead to very few trades that garner only a few pips profit, with most resulting in returns of perhaps 20 to 100 pips each.
I worked backwards this morning, starting with my daily charts, noting which measures conveyed in what direction price was headed in the immediate context, and then deleting all the rest; getting as far as 15-minute charts before it was time to head off to church (though that's as far as I was probably going to go anyway).
Again, the idea now is to employ a kind of dynamic price-range-driven style of trading based on market structure—entering positions in the direction of a given trend as price is bouncing off (statistical) support or resistance. Accordingly, price action is conceptualized more as a set of interactive channels rather than trend lines, with the daily channel being the maximum time frame of primary interest.
Yet, the main driving force is the two-hour baseline, with a focus on its slope or trajectory, and on whether the 34-minute price range envelope and the maneuvers of the 13-minute baseline are positioned above, below, or across this measure. (The 13-minute baseline is used because tracking the nine-minute measure cannot be carried out on a 15-minute chart.)
In addition to noting where the 13- and 34-minute measures are located in relation to the two-hour baseline, the 13-minute baseline should be monitored in terms of its relationship to the 34-minute price range envelope at 0.04% deviation. Yet, the 34-minute measure functions more as a means of discerning the gist of intermediate intraday price action than to define the limits of price fluctuations. Hence, 15-minute candlesticks will often maneuver beyond the 34-minute channel. So then, a better alternative for this job is the 70-minute price range envelope at 0.12% and 0.20% deviation.
Accordingly, if the two-hour baseline is headed north, one should look to enter long positions when price is bouncing off the bottom of (statistical) support in the form of the lower band(s) of the 70-minute price range envelope, especially if this converges with the lower edge of the two-hour price range.
Conversely, if the two-hour baseline is headed south, a trader should look to enter short positions as price is bouncing off the top of (statistical) resistance in the form of the upper band(s) of the 70-minute price range envelope, especially if this converges with the upper edge of the two-hour price range.
Similarly, if the daily channel is headed north, it makes sense to enter long positions as the two-hour baseline reverses course from a southbound to a northbound trajectory—especially when such reversals take place in a region of (statistical) support, as represented by the lower threshold of the daily channel.
Likewise, if the daily channel is headed south, it makes sense to enter short positions as the two-hour baseline reverses course from a northbound to a southbound trajectory—especially when such reversals take place in a region of (statistical) resistance, as represented by the upper threshold of the daily channel.
The same applies to the six-hour measure. But, this measure is lagging, so it is more useful as a tool to help anticipate when the two-hour trend has reached a level where it is susceptible to reversing direction (i.e., when price is located at the top or bottom of the six-hour price range at 0.30%, 0.45%, or 0.60% deviation), and also to confirm the direction of the two-hour trend, which is likely to be above the six-hour baseline when headed north, or below the six-hour baseline when headed south (often only after the trend has already been well-established, given that the six-hour measure is lagging).
I am convinced that these temporal readings (moving averages/baselines) hold true for all other financial instruments as well. However, I am not tempted to apply this methodology to trading commodities, which I find have a tendency to swing wildly and suddenly; nor to trading equities, whose price ranges are not at all uniform from one stock to the next—unlike the currency pairs, which for the most part, evidence the same degree of variation (divergence) from one asset to the next.
As far as the major U.S. indices are concerned, their price action exhibits far too much frenetic energy for me, and there is too much variation within the price range of even a single individual index for me to be interested in anything other than a buy-and-hold methodology to trade these selections. Day trading the Russell 2000, Dow, Nasdaq, or S&P 500 is simply not at all attractive to me.
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Monday / November 1, 2021 /8:30 AM
The market isn't all that active this morning, so I wasn't able to catch any major moves. Plus, I have things I need to go out and do this morning, hence my exiting all my positions now rather than waiting another couple of hours. Nonetheless, by adopting a very strategic, dynamic-price-range driven style of trading based on market structure—which is what it looks like I'm going to be doing from here on out—I should still be okay by simply picking up four pips here, seven pips there, etc., and not executing any losing trades, as this approach seems like it will easily be able to do on a daily basis.
Given that the development of Numerical Price Prediction has come to a complete end, if the trading goes well this week, I will begin to quickly increase my typical trade size to accelerate the amount of funds it generates, and then move as rapidly as possible to setting up something like this Forex Smart Trade setup (apparently another ripoff outfit, according to the review sites) where I can link up with a stable of prop traders who cash in on the opportunities I identify right along with me...
And since my system really works, I won't have to charge recruits for training like all those other supposedly remote proprietary trading firms. I'll just need to verify which potential candidates can follow my directions, and then hire the ones who aren't going to lose me any of my money.
The market isn't all that active this morning, so I wasn't able to catch any major moves. Plus, I have things I need to go out and do this morning, hence my exiting all my positions now rather than waiting another couple of hours. Nonetheless, by adopting a very strategic, dynamic-price-range driven style of trading based on market structure—which is what it looks like I'm going to be doing from here on out—I should still be okay by simply picking up four pips here, seven pips there, etc., and not executing any losing trades, as this approach seems like it will easily be able to do on a daily basis.
Given that the development of Numerical Price Prediction has come to a complete end, if the trading goes well this week, I will begin to quickly increase my typical trade size to accelerate the amount of funds it generates, and then move as rapidly as possible to setting up something like this Forex Smart Trade setup (apparently another ripoff outfit, according to the review sites) where I can link up with a stable of prop traders who cash in on the opportunities I identify right along with me...
And since my system really works, I won't have to charge recruits for training like all those other supposedly remote proprietary trading firms. I'll just need to verify which potential candidates can follow my directions, and then hire the ones who aren't going to lose me any of my money.
I went to Tradeoff.com this morning to see what was happening over there, opened up a chart, and it just so happened to be a great example of what I was talking about...
The price range on the above stock was miniscule before August, then began to swing wildly, stretching both above AND below the trend line simultaneously, and then went back to limiting itself to one side of the baseline or the other after September, once again becoming something that might possibly be traded rationally.
The currency pairs almost never exhibit such crazy price action.
Saturday / November 6, 2021
There's nothing more to do with NPP, so it looks like I'm finally finishing the book...
I'll have to decide after it's done if I'm actually going to list the publication on Amazon for 200 bucks a copy or not. In the meantime, I've resumed a number of other interests as well, including songwriting and learning about option trading. I also need to see if applying the pseudo-swing trading style of executing NPP (that I initiated last week) to Nadex "knock-outs" is more profitable than last week's performance in my traditional OANDA and Forex.com trading accounts (if it is profitable at all).
I'm ready to decided on the final version of my Bible study series for kids too, so I'm working on a logo...
Copyright © 2021 Fred Duckworth
...and for the first time ever, last night I got an idea for a novel where the framework was already fully fleshed out, from the beginning all the way to the end. I'll just need to put meat on the bones and then find a ghost writer to fix all my mistakes for me (since I'm not a fiction writer).
Indeed, if NPP continues to "pay dividends," 2022 should be a very productive year, God willing.
There's nothing more to do with NPP, so it looks like I'm finally finishing the book...
I'll have to decide after it's done if I'm actually going to list the publication on Amazon for 200 bucks a copy or not. In the meantime, I've resumed a number of other interests as well, including songwriting and learning about option trading. I also need to see if applying the pseudo-swing trading style of executing NPP (that I initiated last week) to Nadex "knock-outs" is more profitable than last week's performance in my traditional OANDA and Forex.com trading accounts (if it is profitable at all).
I'm ready to decided on the final version of my Bible study series for kids too, so I'm working on a logo...
...and for the first time ever, last night I got an idea for a novel where the framework was already fully fleshed out, from the beginning all the way to the end. I'll just need to put meat on the bones and then find a ghost writer to fix all my mistakes for me (since I'm not a fiction writer).
Indeed, if NPP continues to "pay dividends," 2022 should be a very productive year, God willing.
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I have no idea why I was thinking about this. Maybe because I keep trying to figure out ways to develop more self control to follow my own method.
But it just now dawned on me that by starting your own prop and structuring it like you are, you no longer have to fear losing self control in trading BECAUSE: 1. You (probably) aren't trading, or you don't have to trade, you simply (will) have others that will follow your alert system and then THEY have to follow the rules. And it will be much easier for them to follow the system rules because they aren't working for themselves, but you.
Now, if I could only think about how I can make that work for my own trading. Maybe I could pretend to be my own prop firm and take only the trades allowed by my imaginary prop firm...
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It's possible that you're right. But, even so, I believe the exact opposite is true. I think it is harder to practice self-control when you are following someone else's system because you don't have full confidence in it.
The reason I have no fear of losing self-control when trading my own way is because I fully understand how my system works, including the logic, rationale and reasoning behind it; and how doing otherwise would just be stacking the odds, or statistical probability, against me.
For example, this image from the book I'm likely to finish writing this year displays graphically why not following my own rules would just be plain stupid (for me—not for anyone else) given how obvious it is how well it is designed to work...