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Interesting you say that Ripley. We test our trading strategies using neural networks and some of the BEST systems we use are failed ones reversed. It often spins out totally different strategies than originally intended.
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Would anyone wish to share a 1 minute chart Strategy
- Thread starter Boy Scout
- Start date
Interesting you say that Ripley. We test our trading strategies using neural networks and some of the BEST systems we use are failed ones reversed. It often spins out totally different strategies than originally intended.
First Post here, hope I got it right.
I have been trying to re-create the MATS method to trade the spot currency market. Mainly the Euro.
I have attached a chart of Friday's action.
First some background. This method is based on the duel auction process and Market Profile. According to the site, there are no technical indicators used. This is something that I happen to like.
The red doted lines with the aqua blue line in the middle is called a Balance Area. A Balance Area is created when there is a series of consecutive PaintBars. When the next bar is not a PaintBar (in this chart green), a line is drawn at the high of the highest PaintBar and a line is drawn at the low of the lowest PaintBar. The a Line is drawn at the midpoint. The idea is that price will tend to trade up to the midpoint giving an entry into the market. If the High is made first, then the low, we have a Selling Balance Area. Conversely, if the low is made first followed by the high, we have a Buying Balance Area. A order is placed +/- 1 or 2 pips below the midpoint as the entry price. If the bar that is not a PaintBar, and trades up to where the midpoint is, then enter on the next bar. We do not know if it is a PaintBar until the bar closes. The Balance Area buy/sell is just one of the trade types in the MATS program.
I have also taken an some ideas from other sources. Mainly the idea of the "magic hours". These hours are from 7am EST to 12pm EST. I have read that these are the best hours to trade. I believe this is true because all the big boys are trading during this time. That is, the e-mini traders are trading and the NYSE is also open during this period (9am open). Using the idea of Initial Balance from Market Profile, I would not trade during the first 30 mins of this period. Hence no trade set up is valid before 7:30 am. On this chart there is a yellow line that stops at 8:35 am EST. The additional hour is added because of a News release that came out at 8:30. In other words, the non-trading time increases on those days when certain news releases are coming out. This partly done because of low volatility (this idea is used by Mark Fisher when he extends his opening range) and because of some issues related to currency trading (spreads/re-quotes/connectivity) during news times. Not to mention that the release can bring wild price swings. While that increases the volatility, it is not good for the trader trying to capture directional movement (trend).
On this chart the red arrow points to the first signal. Since the high was made before the low, we know it is a selling Balance Area. Price trades up towards the midpoint and a short entry is signaled. Mats uses a 1.5 tick stop, I have been using 15 pips as the initial stop level. The next Selling Balance Area does not move back enough to the midpoint to give us an entry. The last Selling Balance Area occurs just prior to the green arrow. This one would be ignored, however, as price had moved 55-60 pips. The green arrow points to the first Buying Balance Area and where we would enter long.
I have been trying to re-create the MATS method to trade the spot currency market. Mainly the Euro.
I have attached a chart of Friday's action.
First some background. This method is based on the duel auction process and Market Profile. According to the site, there are no technical indicators used. This is something that I happen to like.
The red doted lines with the aqua blue line in the middle is called a Balance Area. A Balance Area is created when there is a series of consecutive PaintBars. When the next bar is not a PaintBar (in this chart green), a line is drawn at the high of the highest PaintBar and a line is drawn at the low of the lowest PaintBar. The a Line is drawn at the midpoint. The idea is that price will tend to trade up to the midpoint giving an entry into the market. If the High is made first, then the low, we have a Selling Balance Area. Conversely, if the low is made first followed by the high, we have a Buying Balance Area. A order is placed +/- 1 or 2 pips below the midpoint as the entry price. If the bar that is not a PaintBar, and trades up to where the midpoint is, then enter on the next bar. We do not know if it is a PaintBar until the bar closes. The Balance Area buy/sell is just one of the trade types in the MATS program.
I have also taken an some ideas from other sources. Mainly the idea of the "magic hours". These hours are from 7am EST to 12pm EST. I have read that these are the best hours to trade. I believe this is true because all the big boys are trading during this time. That is, the e-mini traders are trading and the NYSE is also open during this period (9am open). Using the idea of Initial Balance from Market Profile, I would not trade during the first 30 mins of this period. Hence no trade set up is valid before 7:30 am. On this chart there is a yellow line that stops at 8:35 am EST. The additional hour is added because of a News release that came out at 8:30. In other words, the non-trading time increases on those days when certain news releases are coming out. This partly done because of low volatility (this idea is used by Mark Fisher when he extends his opening range) and because of some issues related to currency trading (spreads/re-quotes/connectivity) during news times. Not to mention that the release can bring wild price swings. While that increases the volatility, it is not good for the trader trying to capture directional movement (trend).
On this chart the red arrow points to the first signal. Since the high was made before the low, we know it is a selling Balance Area. Price trades up towards the midpoint and a short entry is signaled. Mats uses a 1.5 tick stop, I have been using 15 pips as the initial stop level. The next Selling Balance Area does not move back enough to the midpoint to give us an entry. The last Selling Balance Area occurs just prior to the green arrow. This one would be ignored, however, as price had moved 55-60 pips. The green arrow points to the first Buying Balance Area and where we would enter long.
Attachments
As the thread starter was asking for 1 min strategies, here is another method that I have been looking at recently. This uses indicators, which I do not like, but it is not indicator based or right side only trading. That is, trades are not entered based on indicator color change or position above below the zero line. This method can be found at the Tactical Trader web site. It seems very good. The real key is in one's ability to recognize and draw trend lines/support and resistance at relevant price areas.
On my chart, the yellow bars are when there are volume extremes. On his charts he too has these yellow bars. On index futures these bars show up when there is program trading. On the Euro, I believe they appear based on time. He uses a 45 tick chart, therefore all bars have the same amount of volume. So the rate of completion of the bar must be what he is using. For example, if the average time for a bar to complete is 30 seconds. A bar would be painted yellow if the time it takes is only 15. This would imply greater activity at that time which could be translated to increased volume. Just my guess.
The site does give the parameters of the green/red line and the green/red histogram. Also the parameters for the High-low channel are given. He does not give the settings for the blue-purple lines (slow momentum flow), but does say it is an oscillator tied to slow momentum (histogram) not price and is smoothed but not with an exponential moving average. I have used Wilder's smoothing. The purple SAR is not what he uses. He says it is based on the 9 period high/low channel and not price. I have a plain SAR. Still working on this one.
The aqualine is placed at the price specific area. He calls a price area that acts as both support and resistance as price specific. The circle is the entry signal. Again, he is trading from the left to the right. Understanding what has happened on the left side of the chart is key to trading the right. An indicator only trader would be looking to trade the right side, usually based on a change in color of the indicators. Here we see that slow momentum flow is down, then we get both fast momentum (3-10) and slow momentum (4-23) turn down. However, both the price specific point and an understanding of how the News release has been absorbed by the market are why the trade is taken at the circle.
everything need to create a method close to his can be gotten at the tactical trading site.
On my chart, the yellow bars are when there are volume extremes. On his charts he too has these yellow bars. On index futures these bars show up when there is program trading. On the Euro, I believe they appear based on time. He uses a 45 tick chart, therefore all bars have the same amount of volume. So the rate of completion of the bar must be what he is using. For example, if the average time for a bar to complete is 30 seconds. A bar would be painted yellow if the time it takes is only 15. This would imply greater activity at that time which could be translated to increased volume. Just my guess.
The site does give the parameters of the green/red line and the green/red histogram. Also the parameters for the High-low channel are given. He does not give the settings for the blue-purple lines (slow momentum flow), but does say it is an oscillator tied to slow momentum (histogram) not price and is smoothed but not with an exponential moving average. I have used Wilder's smoothing. The purple SAR is not what he uses. He says it is based on the 9 period high/low channel and not price. I have a plain SAR. Still working on this one.
The aqualine is placed at the price specific area. He calls a price area that acts as both support and resistance as price specific. The circle is the entry signal. Again, he is trading from the left to the right. Understanding what has happened on the left side of the chart is key to trading the right. An indicator only trader would be looking to trade the right side, usually based on a change in color of the indicators. Here we see that slow momentum flow is down, then we get both fast momentum (3-10) and slow momentum (4-23) turn down. However, both the price specific point and an understanding of how the News release has been absorbed by the market are why the trade is taken at the circle.
everything need to create a method close to his can be gotten at the tactical trading site.