I've been reading 100s of posts on the Jack Hershey method with an open mind. I think it has a lot of potential if described correctly. After so much reading, i was expecting to get some clarification. I understand how trend channels are supposedly built, what an FTT is, how to read volume, how to interpret BOs and FBOs, and so on. I've been developing systems for quite some time, i'm a programmer, and have had sufficient success in low-risk live trading. I've looked at a lot of different "indicators" and developed many of my own. Some parts of the jack hershey method strike me as remarkably similar to my own conclusion, especially about the FTT, that i almost thought "he stole my idea!".
However, I still have a lot of questions, so I won't ask all of them at once. Here are a few easy ones.
1- When a trend channel is forming we need points 123. I've seen charts where people have drawn those points. There seems to be very little consistency in defining what those points are however. They are supposed to be "highs and lows". In one chart posted by Jack, they are defined as highest bar out of 10+ bars around it. This means that at least 5 bars need to be lower in the past and future for it to be considered a "high" point. On other charts i've seen this number as low as 1, meaning that some people have constructed points 1 and 2 on two bars, without knowing if the 3rd bar will or will not end up higher still. These are the basics of "highs and lows detecting indicators". These indicators require a period of refference, and this to me is unclear. Sure, i can subjectively see them, but here is the problem. There is no consistency in detecting points 123, and if we wanted to make "sure" that for example point 3 is really where we thought it is, we have to wait N bars (ie 5 bars) to make sure no subsequent bars go below it. That means we have to wait 5 bars after pt3 has appeared to construct a trend channel. This then means we can enter the channel and be in a trade about 5 bars after point 3, and by that time we can't say if the trend channel will even continue sufficiently to be profitable. So my question is: what are the clear rules for defining points 123? Highest bar of how many, and of course comparing volume too, can anyone declare those rules or make them clearer?
2- After reading so much I also didn't figure out how FTT followed by a BO is supposed to be defined. Some define a BO as a breakout from a trend, but what happens if the price gets back into the trend and thus creates an FBO? How long do we wait for a BO to be confirmed? 4 bars? 5 bars? 0.2% of price change from the FTT? 15% increase in volume? Any criteria at all? Or is it just kinda subjective.
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I have more questions but these are good enough for me, for now. If anyone can answer me but doesn't want to because they think i didn't "read enough on my own" and that "they don't want to serve me answers without me searching for them more" then please direct me to where i could obtain information to clarify this. I am very good at using google and searching in general, so i think i've done my part.
Note: I am completely open and unbiased at this moment. I don't like people flaming Jack without proof, nor do I like people boasting about the system and saying some are "too thick to get it". I myself have worked on systems far more complex, and agree with the hypothesis jack has presented. I am unsure i agree with the methodology because to me it is unclear, and this is what i want to figure out. I approach this with my usual scientific mind and curiosity.
Finally:
If Jack, Spytrader, or anyone with a track record of using the system for over a year wants to explain it to me fully and devote the time to get to the nuts and bolts, i can assure that person that i can make a computer do it just as well as a human mind can. As long as the system has rules. I'm willing to devote a few months of my time and my proprietary trading, backtesting, study and analysis platform just out of curiosity - to put this theory to the test. If somebody tells me that these "rules" cannot be coded, my reply will be that in that case there are no rules to begin with and it's all speculative and subjective - thus eliminating any need for proving or disproving the hypothesis, because there is none. Also note my trading platform is already able to create trend channels, digaonal support/resistance and horizontal support/resistance trend lines. The trend channel creation in particular is very fast and accurate, and lots of studies have been done to make sure they are "the best detectable TCs" that can be found.
