Prove to me that Technical Analysis Works.

[easymon1]

My trades are automated and all I see is a black and white console with some boring text logs.

Sounds just fine by me man. Most excellent.
What becomes the target of optimization for something like that?
No need for a white paper on the subject just a few items that are important when you think about your system, besides the "damn I'm glad I got this thing working" aspect of it all.

 

[guest_trader_1]

Sounds just fine by me man. Most excellent.
What becomes the target of optimization for something like that?
No need for a white paper on the subject just a few items that are important when you think about your system, besides the "damn I'm glad I got this thing working" aspect of it all.

I normally deliver software by implementing microservices. It is an approach for web APIs that can be translated to other domains.

So the fist step would be to identity independent modules that would act on specific objects. Those modules will contains a set of actions that are specific and unique to them. You end with a structure that would be similar to a company.

Accounts, Positions, Trades, Order and Executions, Trading Algo, Money Management, Risk Profile. All of these items could be departments of a company.

The target is to comunícate all modules with actions that are controlled by one single entity at all times. DBAs call this concept "normalization". One piece of data is stored and controlled by one single instance and it is not duplicated anywhere else. Software devs call it S.O.L.I.D principles.

Once you have everything in place your trading algorithms are ready to be executed.

I follow Ernest Chan's results on Algo Trading. He proved many times that humans need complex algorithms to feel satisfied in trading but the most profitable are the simplest. So when developing algorithms always look for the simplest solution.

A simple algorithm can be very profitable if it is executed right. So your target is to backtest an idea and try to make it as simple as possible. The benefit of automated trading is the power of its executions. A computer program does not sleep, does not get tired and does not change its mind. That resilience is what makes it to work on top of discretionary trading.

As per getting trading ideas, there are tons of successful attempts at the mql/meta trader forums.

 

[easymon1]

I normally deliver software by implementing microservices. It is an approach for web APIs that can be translated to other domains.

So the fist step would be to identity independent modules that would act on specific objects. Those modules will contains a set of actions that are specific and unique to them. You end with a structure that would be similar to a company.

Accounts, Positions, Trades, Order and Executions, Trading Algo, Money Management, Risk Profile. All of these items could be departments of a company.

The target is to comunícate all modules with actions that are controlled by one single entity at all times. DBAs call this concept "normalization". One piece of data is stored and controlled by one single instance and it is not duplicated anywhere else. Software devs call it S.O.L.I.D principles.

Once you have everything in place your trading algorithms are ready to be executed.

I follow Ernest Chan's results on Algo Trading. He proved many times that humans need complex algorithms to feel satisfied in trading but the most profitable are the simplest. So when developing algorithms always look for the simplest solution.

A simple algorithm can be very profitable if it is executed right. So your target is to backtest an idea and try to make it as simple as possible. The benefit of automated trading is the power of its executions. A computer program does not sleep, does not get tired and does not change its mind. That resilience is what makes it to work on top of discretionary trading.

As per getting trading ideas, there are tons of successful attempts at the mql/meta trader forums.

Yeah, I do a lot of that too. WTF are you doing over there man? Is it even legal? Go on with your bad self, while I go buy a dictionary. Be back in a week.

 

[easymon1]

The answer, the market went in a rally up, pretty big gap, tons of buyers coming in. Probably institutional fat money.

View attachment 293034

Hey man, the suspense is killin me. What was the fate of the price movement on that chart if that double top stop were placed "according to Hoyle" a few ticks above that second formation High?
The m(i)dified stop was not optimal for that trade as they say, lol.
How about the Hoyle stop vs the 100% measured move?
Where'd she end up?
Winner winner chicken dinner or peanut butter sammich?
Hell, I'm throwin that in my stats after alla that for just one trade, gotta get something for the effore, lol. Waste not want not, right?

LossView attachment 293039

 

[guest_trader_1]

Hey man, the suspense is killin me. What was the fate of the price movement on that chart if that double top stop were placed "according to Hoyle" a few ticks above that second formation High?
The m(i)dified stop was not optimal for that trade as they say, lol.
How about the Hoyle stop vs the 100% measured move?
Where'd she end up?
Winner winner chicken dinner or peanut butter sammich?
Hell, I'm throwin that in my stats after alla that for just one trade, gotta get something for the effore, lol. Waste not want not, right?

Once you know the result you can start convincing yourself with all sort of TA techniques. There is one for every case.

That's why I posted two charts and asked about the next move, and both caused trouble.

It is very easy to talk about where to place a stop when you know what is going to happen. That's the script on every TA book.

That "Hoyle" chap, I am sure that has tons of examples explaining those stops, every single one of them picked up knowing the result in advance.

 

[guest_trader_1]

 

[easymon1]

Once you know the result you can start convincing yourself with all sort of TA techniques. There is one for every case.

That's why I posted two charts and asked about the next move, and both caused trouble.

It is very easy to talk about where to place a stop when you know what is going to happen. That's the script on every TA book.

That "Hoyle" chap, I am sure that has tons of examples explaining those stops, every single one of them picked up knowing the result in advance.

I'm a rules based trader AT.
The rules are based on stats.
The stats are based on charts.
Like the one that you posted.
I would like to include that in my stats with the two outcomes for sorting pleasure, lol
The result being the "Classic stop. and the Prior Swing stop.
The stats do the convincing.
Unlike the esoteric Artistic intuitive traders this lowbrow data driven method is what I use to estimate odds of favorable result.
At home, ymmv, lol.

I'm happy to do this thing, but you gotta futz with the charts, no problemo, glad to get some more stats and have some fun.

Or anybody else for that matter? Hell it's fun.
Do it here or do it over at this joint. - https://elitetrader.com/et/threads/...-game-with-you-all.365997/page-2#post-5568580

Up to you. You gonna at least give me the symbol and timeframe for Trade #1 and agree to those terms for trades 2 - 5?
Make you a deal, if you provide the result or at least the Symbol name and time frame so I can look it up myself, then I'll do 4 more of your charts if you agree to post that info for those charts too.

I am a "pullback to support" price action trader.

Those are in my toolbox so at least put a couple of those in there, I'll be happy to make a fool of myself on whatever rangebound breakout crap you throw up but that is not the action I look for and it is against my religion to trade when there's no action. Commandment V, When there's no action, Take no action, with fuggs inferred corollary to Ct-V Relax-have a Homebrew.

Pullbacks or Pullups to support or resistance: Put a 200, a 50ma and an 8ema and giddy up.
You post em and I'll give em a shot.

Yes or no? - https://justflipacoin.com/#flip-a-coin

BTW futzin with those charts and keeping up with posting the proper results with the proper charts does not pay well, lol.

Hell, I still gotta do my HG stats before getting some snoozola. No hurry on those charts, if they appear, then we put it in gear.
Shiny side up and Ill try to do the same.

 

[Sprout]

Once you know the result you can start convincing yourself with all sort of TA techniques. There is one for every case.

That's why I posted two charts and asked about the next move, and both caused trouble.

It is very easy to talk about where to place a stop when you know what is going to happen. That's the script on every TA book.

That "Hoyle" chap, I am sure that has tons of examples explaining those stops, every single one of them picked up knowing the result in advance.

Stops are pools of liquidity and tend to cluster depending on a trader's timeframe. An intraday trader will have stops much tighter than swing trader that has a position that span days. Logically, those intraday stops will not have as much resting liquidity as those that are positioned much farther away from the current HRE.

As for TA, it's simply a way of structuring information to provide a personal mental framework. Any line could work for it would be a reference for continuation or change.

You can give a random selection of adults a map and compass and drop them in the middle of unknown territory. If their experience is only using a phone's gps, they will not do as well as someone who might have done orienteering as a child. While some maps are better at describing the territory, it's just information until one applies knowledge by combining the compass that can support a decision.

So whatever one's flavor (FA,TA) that allows them to participate successfully in the market, who is anyone to argue?

You wanna post a follow-up chart?

 

[easymon1]

You wanna post a follow-up chart?

If he doesn't want to, lets play over here, post one up.

My advice make the outcome chart first.
Save that file
Then crop the symbol and maybe x-axis, maybe price, off the chart, depends on how you go about it.
Crop back to wherever you want the last candle to be.
Save that associated file and post that one up.
Be ready to find that ANSWER chart, lol. make it easy on yourself by file-naming convention.

Right Here where it's been done already...
If he doesn't lets play over here, post one up.
https://elitetrader.com/et/threads/...-game-with-you-all.365997/page-2#post-5568580

 

[guest_trader_1]

Stops are pools of liquidity and tend to cluster depending on a trader's timeframe. An intraday trader will have stops much tighter than swing trader that has a position that span days. Logically, those intraday stops will not have as much resting liquidity as those that are positioned much farther away from the current HRE.

As for TA, it's simply a way of structuring information to provide a personal mental framework. Any line could work for it would be a reference for continuation or change.

You can give a random selection of adults a map and compass and drop them in the middle of unknown territory. If their experience is only using a phone's gps, they will not do as well as someone who might have done orienteering as a child. While some maps are better at describing the territory, it's just information until one applies knowledge by combining the compass that can support a decision.

So whatever one's flavor (FA,TA) that allows them to participate successfully in the market, who is anyone to argue?

You wanna post a follow-up chart?

I did post a follow-up chart!

https://www.elitetrader.com/et/thre...al-analysis-works.367351/page-69#post-5662518