Numerical Price Prediction Challenge

[expiated]

Most of this information is probably the same, or almost the same, as before. But as I polish the details, I want to keep everything updated. Plus the more I write it out, the faster I’ll be able to commit all my settings to memory, given that I eventually want to have all the parameters in my head and so familiar that I am able to rattled them off without even having to think about it.

SMAs (XX), (XX), and (XX) confirm the direction of the daily trend, but are too sluggish and lagging to pick up on or recognize the initial formation of overall day-to-day trend reversals as they occur in the context of daily price ranges.

Thus, this task must fall to SMAs (XX) and (XX). Consequently, these two indicators should be regarded as the primary arbiters of market bias/sentiment, with currency pairs deemed bullish as long as candlesticks are forming above this trend-line duo, or bearish whenever candlesticks are forming below it, especially if the slopes of these moving averages concur with the above assessment.

Moving down to the intraday time frame finds the general overall direction of price reflected in (or conveyed by) the slopes of SMAs (XX) and (XX), so perhaps the best time to enter positions is when the trajectories of these two moving averages reverse from plotting paths in opposition to the day-to-day trend to routes flowing in unison with it (instead).


This relegates SMAs (XX) and (XX) to tracking fluctuations within the overall direction of price at the intraday level. But it also renders them as more accurate (and therefore more valid) tools for gauging when to enter and exit positions than SMAs (XX) and (XX), so if one has the luxury of monitoring price action and managing positions more closely, this couple should be used in place of the longer-term XX- and XX-period SMAs for entering positions.

All of this applies to a pseudo swing style of trading. But it is much easier to rack up gains if one moves down to a five-minute chart setup and applies guerrilla scalping tactics instead to one’s trade executions.

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In this context, the day-to-day general overall trend-lines consist of SMAs (XX), (XX), and (XX), with SMAs (XX) and (XX) distinguishing between bullish and bearish market bias/sentiment, and the overall direction of the intraday trend conveyed by the blue simple moving average cluster of SMAs (XX) through (XX).

Also plotted at this level are lines that are not represented at the higher time frames—three versions of SMA (XX). This graphic possesses the kind of detail and precision required for it to serve as an extremely accurate early alert/warning signal for highlighting possible reversals in the intraday trend.

Now the pink cluster consisting of three versions of SMA (XX) has the added duty of validating the potential reversals highlighted by SMA (XX) in addition to still maintaining its former role as a “trigger” for position entries and exits (whereas the green cluster of SMAs (XX) through (XX) confirms whatever the red cluster validates).

The primary statistical support and resistance levels (i.e., typical intraday price ranges, which assist in establishing entry and exit points) are defined by the XX-period simple moving average envelope at X.XX% deviation, whereas the secondary levels of statistical support and resistance are defined by the white-banded XX-period simple moving average envelope at X.XX% deviation.

The typical day range is defined by the XX-period simple moving average envelope at X.XX% deviation, or X.XX% deviation under more volatile conditions.

 

[expiated]

Signs of a reversal south by USDJPY should be taken with a grain of salt, considered extremely suspect, and not be trusted. Don’t be surprised to see the pair resume a northward trajectory at anytime within the next forty-eight hours.

USDJPY finally followed through on its potential turn south. It appears AUDUSD is changing course as well, having apparently decided to push north. I was hit extremely hard by reversals in the Cable pairs and EURUSD, but feel confident I will be able to get back on track and rise from there relatively quickly.

 

[expiated]

Nothing new in terms of chart setups…nonetheless, I might have just gained a bit of fresh insight into how the relationships between typical price ranges and three key simple moving averages might be used to further optimize my position entries and exits. So far, I have executed two successful trades based on this new possible revelation, with a third still unfolding.

 

[expiated]

My Numerical Price Prediction (NPP) trading system is predicated on what more experienced traders tell me is a bogus contention that within a given timeframe there will be specific moving averages that do a much better job of accurately reflecting price direction than all others.

The genesis of this conviction was sparked in November of 2015, and after almost four years in development, it’s looking like all the specifics of its most essential elements might, at this point, have been pretty much worked out.

Realizing an approximately 85% daily success rate (which I find completely acceptable) without limiting myself to intraday micro guerrilla scalping at one time looked to be a totally unattainable goal for me—yet recent performance data suggests that the dawn of a new era in which such outcomes are no longer unrealistic is beginning to see the light of day, especially considering that I am no longer modifying my parameters in any significant way, and am therefore gaining a fuller understanding of how to use these settings to interpret price action with a heightened clarity, resulting in market forecasts that have every chance of raising my daily success rate even higher, thanks be to God.

 

[expiated]

USDCAD looks like it is trying to turn south. NZDJPY appears to have succeeded in joining NZDUSD in turning north. AUDJPY also looks like it has joined AUDUSD in turning north. USDCHF is still in consolidation, but I am currently long in that I’ve seen no signs of a reversal south yet.

 

[expiated]

Today’s developments revealed a fatal flaw in my system. It turns out that SMA (XX) does NOT represent the general overall trend. For that, I should have been relying on SMA (XXX). As a result, I was demolished by AUDJPY, NZDJPY and CADJPY.

My recovery is being lead by USDCHF, which has initiated a Bona fide turn south, and also EURUSD, whose reversal north has also been confirmed.

 

[expiated]

Due to the added confidence I have in the NPP forecast model with the “extra” moving average to facilitate valid interpretations of market conditions, I increased the Lot size of the last trade I made in my virtual trading account on Wednesday from 0.05 to 1.00.

Unfortunately, because I am not monitoring/managing my positions, I missed the opportunity to lock in my gains when the candlesticks advanced halfway to my take-profit target. By the time I checked the progress of the trade ten minutes later, I was upside down in the position.

To make matters worse, price continued to retreat and took out my stop loss! Consequently, I had to reenter the trade to wait for the rate to fall all the way back down to my original target. But then the same thing happened all over again (almost)…

While I was busy working, the rate of the first position I had entered advanced halfway to my take-profit target, and two-thirds of the way with respect to a second position I had entered.

Had I been monitoring my positions, I would’ve been able to recoup all of my previous loss with a nice bit of profit on top, and then reentered both positions at the top of the subsequent pullbacks to reap additional profits on the way back down again!

Later on I was able to do just that, only to discover that I had accidentally used 0.05 again instead of 1.00, so that my profit was twenty times smaller than what it SHOULD have been, leaving me still in the red when I ought to have been solidly in the black.

 

[expiated]

At this point, this thread as originally conceived has indeed come to an end, so I will now be using it merely as a convenient place to post observations for use in making market forecasts and timing trade entries and exits.

Now that I’m back at a new high in terms of cumulative profit in my virtual account, I’ll probably switch back to trading 0.05 Lot sizes (given that finishing the week higher than where I started it was my only objective when I jumped up to standard Lots).

The fact that I was able to accomplish this while trading sporadically and making about three whopping careless errors in the process only increases my confidence in what the system can potentially accomplish once I have the time (next year) to implement it seriously.

(At that time I probably WILL trade in Lot sizes as large as might be prudent relative to the size of my account balance.)

I thought that if and when the day came that my methodology was finally fully fleshed out and I could settle in with a repetitive routine, trading would get extremely boring.

I assumed that would just be par for the course, but to my surprise, I’m finding that just the opposite is true. As applying NPP becomes more routine, it’s also becoming a lot more fun.

However, at this point, the observations, market forecasts, and fine tuning of entries and exits which motivated me to resume posting entries in this journal are now part and parcel of my charts and my mental framework, which makes recording them here unnecessary and a suddenly boring aspect of what I do, so I’m probably not going to do so anymore for a while.

 

[expiated]

 

[expiated]

I spent less than a week seeing if I could adapt the Numerical Price Prediction (NPP) pseudo-swing trading system to buying and selling Forex binary option contracts via a North American Derivatives Exchange (NADEX) demo account, curious to see whether this exercise might provide me with any useful insights, which I believe it did.

The results of today's trading (in a separate demo account with a traditional Forex broker) are a reflection of what I believe I've learned in the last couple of days, but I am suspending the experiment, primarily due to the fact that, more often than not, when I log into the NADEX demo account, the platform is dysfunctional and I am unable to make any trades.

Particularly noteworthy from a personal standpoint is that my average profit trade was more than double my average lost trade. This is nearly unprecedented in my personal trading history and bodes well for the potential benefits this week's insights might offer when I return to full-time trading sometime around March of 2019.