Simple System for Beginners

Quote from manni0805:

hallo AR,

i got just into your forum and i found it very interesting.
Thank you for that.

I´ve one more question:

When ER2 did already reach the entry points and went back into the narrow range before 1:00, are the entry points still the points to enter after 1:00 till 2:45 ? or: marketorder in the direction of the first touch of range...

I think, again the points to enter, right?

Is it too stressfull for you, to show the daily results after the day to follow you? not only month...

For how long do you trade this simple system? and still?

regards Manfred
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1)the stop-entry points should remain, even if it breaks and dips back into the range

2)autotrade it...I manually placed the orders, and got 0 slippage (due to the stop orders), but I found myself watching the screen too much, and even started messing with the exits (manually adjusted to trailing stop).
 
Quote from AnomalyResearch:

open = 548.20
long signal = 548.20*1.0033 = 550.00 STOP
short signal = 548.20*.9967 = 546.40 STOP
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Questions -

-Why have you chosen 0.33% from open for the buy/sell signal ?
-Whats the success rate of this trading method ?
-Why only ER2 ? would this method work in other markets too ?

Please advise

tks n rgds
 
only just read this thread.

there is a simple explanation for why the "simple system" of the original post has high probability of success - it is taking advantage of the timing of max daily excursions predicted by random walk, which predicts price extremes are far far more likely near the open and near the close and least likely in the middle of the day. and, fortunately, whether or not one believes in RW doesn't really matter because historically the market does in fact act that way.

only adjustment i'd be inclined to make is to the entry "coefficients": instead of absolute numbers, these should, for long term robustness, be a function of the volatility. some might look at that as a complication, but to me it's a simplification since it is less reliant on an arbitrary number.

the system also depends on highly liquid markets, so i wouldn't be trying to apply this to - shudder - microcaps.
 
I have studied the hole thread and i don`t really want to tune the system, because KISS.

Can you explain your volatility rules?

thanks a lot.

I will try it with the indexfund IWM, only to get a feeliing for it.

best regards manfred
 
Quote from manni0805:

I have studied the hole thread and i don`t really want to tune the system, because KISS.

Can you explain your volatility rules?

thanks a lot.

I will try it with the indexfund IWM, only to get a feeliing for it.

best regards manfred
More...

I was thinking of using a percentage of the 3 day average daily range added/subtracted from the Opening Price as a substitute of those absolute percentages. I want to use Daily Hi minus Daily Low instead of ATR, because we are using MOC orders and not closing the trades next day on open. Even though there is overnite risk, MOO orders may improve the profitability.

Can anyone test this idea please?

Maji
 
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