Duxon's Archive

Discussion in 'Journals' started by expiated, Feb 1, 2019.

  1. expiated

    expiated

    From my Nadex Knock-Outs thread...

    upload_2022-5-10_13-7-15.png

    I also don't want to forget about the potential returns offered by the strategic application of a regression toward the mean/mean reversion trading tactic when rates have deviated from the 45-minute baseline by 0.30% or more
     
    Last edited: May 10, 2022
    #771     May 10, 2022
  2. expiated

    expiated

    If Terra is tied to the US dollar, how did Luna lose 99% of its value?

    The UST coin is designed to retain a value of one US dollar at all times, but depegged on Saturday and has since fallen to as low as 30 cents.
     
    #772     May 13, 2022
  3. expiated

    expiated

    The following protocol has proven it can return the full $100 Nadex Knock-out payouts, and is how I will be trading going forward...

    J. M. Hurst defined eight principles which provided the definition of his cyclic theory. The fifth principle, the Principle of Synchronicity, stated that waves in price movement are phased so as to cause simultaneous troughs wherever possible.

    As applied to the culminating methodology used by the Bias Overlap Six-minute version of Numerical Price Prediction for day trading the Forex market, this synchronicity occurs not only with troughs, but with crests as well (given that the object of trading foreign currency pairs is not simply to make money when rates are rising, but also when they are falling).

    More specifically, the Bias Overlap approach looks for simultaneous peaks and valleys between one or more 105-, 70-, 12-, and 10-minute measures, as explained in the following description:

    If we we label the side of a price range or simple moving average envelope that is opposite or away from the direction of the slope of its associated baseline/trend line as the "back," then the best time to enter a position is when candlesticks are forming at the back end of the 1¾-hours (105 minutes) temporal support or resistance level (as appropriate), AND painting on the back half of the 70-minute price range envelope (if possible), AND forming at the back end of the 12-minute temporal support or resistance level (as appropriate), AND at the back end of the 10-minute price range envelope.

    The trigger or signal to execute such trades is when there is a reversal in the six-minute baseline in proximity to the four above-mentioned measures/levels, as confirmed by similar reversals in the upper and lower bands of the dynamic seven-minute price range envelope.


    Here is a more detailed explanation:

    HOW DO YOU KNOW WHEN THE INTRADAY PRICE FLOW IS REVERSING DIRECTION?
    1. First of all, the two-minute baselines will switch from ebbing and flowing primarily on one side of the Price Projection Sidekick (i.e., the six-minute baseline) to the other.
    2. Similarly, the Price Projection Sidekick will cross over from one side of the Price Projection Indicator (i.e. the 12-minute baseline) to the other.
    3. And candlesticks will also begin painting on the opposite side of the Price Projection Indicator (the 12-minute baseline).
    4. Moreover, the upper and lower band(s) of the dynamic seven-minute price range envelope will begin curving in the other direction.
    5. And finally, the floor and ceiling of the Donchian Channel will begin stair stepping AND making steady progress in the NEW direction.
    If such a reversal has already taken place, positions can subsequently be entered as rates are coming out of less pronounced pullbacks in the two-minute baseline (off the floor or ceiling of the 12-minute temporal support/resistance channel along with the upper or lower band of the dynamic seven-minute price range envelope, as appropriate).

    And speaking of of the two-minute baseline, I will just briefly mention that one of the key "signs" I'm seeking when scalping is for the six-minute baseline to maintain a parallel course with the upper (blue) or lower (red) band of the dynamic seven-minute price range envelope when the band is sloping up or down (NOT when it is level/horizontal, obviously) and for the candlesticks to maintain their position above or below the (green) 2-minute baselines, as appropriate.

    And if the candles are painting to the outside of the envelope, so much the better. In fact, if the candlesticks are not yet forming on the outside of the seven-minute price range envelope, I probably shouldn't be in the trade.

    ScreenHunter_11906 May. 13 22.28.jpg
    CONGRATULATIONS!

    You can now return to doing more of the kinds of things you "normally" do, since Numerical Price Prediction is probably about to go on "autopilot," and if it does, is likely to require much less of your attention.

    Now that the final (bias overlap six-minute) protocol is established, there is not much thought required to recognize potential entry points, so if God wills, have fun getting back to some of the other ways you like to spend your time!!!

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    Last edited: May 14, 2022
    #773     May 14, 2022
    studentofthemarkets likes this.
  4. Overnight

    Overnight


    Your hindsight analysis is legendary.
     
    #774     May 15, 2022
  5. expiated

    expiated

    Updated (from April 1, 2022) Numerical Price Prediction Explanation
    Copyright © May 31, 2022 by Fred Duckworth

    Numerical Price Prediction is a unique and innovative day trading system that relies on a methodology similar to that used by meteorologist to predict the weather—one based as much as possible on statistical analysis and mathematical probability. The idea is to gather and evaluate precise, up-to-date, quantitative data and use it to calculate the odds of price reaching designated values within a given time period by patterning the system's elements after the equations, wave functions, and computer models used in weather forecasting.

    But, instead of monitoring wind velocity and direction, cloud formations, humidity, temperature, and barometric pressure; it evaluates the synergy between such factors as typical price ranges, reoccurring chart patterns, horizontal support and resistance levels, trend lines, and market structure, all in multiple time frames—with the result being a graphical depiction of current conditions that traders can then use to help make precise, well-timed trades.

    The system incorporates the idea of cycle theory, which holds that cyclical forces, both long and short, drive price movements, and can be used to anticipate turning points. It's also compatible with Edgar Peters' fractal market hypothesis, which views financial markets as fractal in the sense that they follow cyclical and replicable patterns—ones consisting of fragmented shapes that break down into parts which then replicate the shape of the whole.

    I used these cycles to generate what some call "baselines" by conducting a thorough analysis to first uncover the cyclical waves formed in the wake of price action, followed by the defining of their general frequencies and magnitudes; and then finally plotting centered moving averages that came as close as possible to approximating the zero amplitude of the corresponding waves/cycles.

    Even so, to trade with the clarity and precision I desired required me to carry out an additional step in which I assigned a specific temporal value to each individual baseline and its corresponding or associated price-range envelope(s)—to answer the questions: What moving average best conveys in which direction and by how much price moves every five minutes? Or every thirty minutes? Or every four hours? Or even every day?

    And yet, even after this "final" step, their emerged still another aspect to interpreting price action that proved deserving of my consideration which I had not envisioned at all—the concept of "temporal" support and resistance.In other words, not only do I believe there is a certain amount of distance beyond which exchange rates will typically resist separating themselves from the central tendencies of key price distributions. It seems to me I have also observed that there is generally a limit to the amount of time exchange rates will advance in one particular direction without deviation. I refer to these limitations as temporal support and resistance, and they have proven to be a welcome enhancement to my system.

    Numerical Price Prediction was developed based on the following five biblical principles:
    1. Test everything and hold fast only to that which proves valid and reliable.
    2. Systems generally operate at peak performance when the interactions between their component parts evidence strong, healthy relationships.
    3. The best plans are usually established in the presence of a multitude of counselors.
    4. Rightly interpreting the signs of the times is an absolute necessity.
    5. Positive outcomes are typically the result of having made good choices.
    To my surprise, applying the principle of "testing everything and holding fast to that which is good" led me to reject many strategies wholeheartedly endorsed by any number of trading gurus, such as Elliott waves, Fibonacci ratios, harmonic patterns, pivot points and the like.

    In effect, I replaced the advice to "keep your eyes on the road" with a mandate to "focus on your destination," a subtle, yet profound, distinction. Obsessing on the former tends to be constraining—dictating one's movements and limiting the parameters within which one is free to operate, often locking people into notions that are not truly worthy of the reverence bestowed upon them.

    But, emphasizing the latter allows folks to be creative and take any route desired, so long as it carries them toward that on which they have resolutely set their gaze.

    So, when strategies involving moving average convergence/divergence (MACD), stochastic oscillators, the relative strength index (RSI), the commodity channel index (CCI), the average directional movement index (ADX) and other indicators failed to live up to their reputations, I had no qualms about discarding them entirely and searching elsewhere for the "signs of the times" which, if interpreted correctly, would result in market forecasts of unusual accuracy.

    As it turned out, I found that the absolute best "atmospheric barometer" for predicting the direction in which an exchange rate might ultimately be headed was nothing more than a simple moving average, with a handful of key moving averages evidencing superior accuracy in this role.

    Nonetheless, there are any number of factors, or "data points" impacting foreign currency exchange rates, with the "Holy Grail" being the ability to unravel the hidden correlations between them. It's a matter of crunching the numbers and doing so in the correct manner, plain and simple.

    And speaking of "correct manner," I think I should probably mention that, though one often hears traders stating "the trend is your friend," from my perspective, it would almost surely be more accurate to say that the trend is merely one of several friends.

    For it seems to me that what would have to be considered at least equally as important as trend is the location of rates within the entirety of a given asset's price distribution.

    So then, though investors often speak of trend lines, I've ceased to think of trends as being represented solely by lines, and have come to conceptualize them as belts as well, with the location of price within the expanse of values constituting the width of these oscillating bands being just as important (when deciding exactly where to enter and exit positions) as the general direction that each "breadth of values" is headed.

    Accordingly, my final decisions on when to buy and when to sell are always made based on the consensus of various input data, sampled in multiple time frames—data which includes baselines, market structure, temporal support/resistance, horizontal support/resistance, price ranges, and reoccurring chart patterns, as stated above.

    It is the consensus opinion of all these various factors that determines what I will decide to do in the final analysis. The moves I make depend on what each of these determinants means in light of all the others and how they all will affect and impact on one another. It is the interpretation of each moving part individually—and of all these assorted components as a whole—that constitutes Numerical Price Prediction. Nonetheless, chief among these measures is the 30-minute baseline. This is the primary indicator dictating at what point and in which direction positions will be entered and exited at the intraday level.

    So then, Numerical Price Prediction is all about interpreting what's happening in the moment based on market generated information, which is to say, technical analysis. (I choose not to put my trust in non-market generated information—meaning fundamental analysis.)

    It comes down to "ruling reason," which for me, is just another way of saying the numbers, or "the math" if you will—the summation of all those correlating data points that are a part of the market generated information.

    Another key component of this system is the 2½-hour baseline, which is assigned the task (along with the 1.83-hour baseline) of conveying the gist of the general overall direction in which rates are headed at the intraday level.

    So then, stated as simply as possible, the main idea is to look for 30-minute pullbacks in the 2½-hour price flow.

    Such pullbacks are confirmed when the 30 minute baseline is rejected by statistical support or resistance in the form of the 70-minute price range at about 0.20% deviation and/or the 2½-hour price range at about 0.30% deviation.

    If the 30-minute baseline elects not to maneuver a hook somewhere near these levels, the pair is almost certainly in the midst of a fully-fledged reversal rather than simply executing a temporary pullback.

    (Additionally, another possible move that confirms a reversal in the intraday trend is if the primary area in which price action is taking place switches from one half of the 2½- and/or 5-hour price range envelope to the other half.)

    Beyond this, one can drill down to trade with even greater precision by entering positions in the direction of the slope of the 30-minute baseline on the "far" side of the 40-minute temporal support/resistance level, and exiting those positions on the "near" side of this same measure. (The 45-, [50-] and 70-minute baselines are often helpful in confirming the trajectory of the 30-minute measure.

    Maximum precision is offered by the two-minute baseline, which tracks short-term price action "like white on rice," with the four-minute baseline eliminating most of the insignificant price fluctuations observed in the faster measure, and the six- and eight-and-a-half minute baselines conveying the gist of this shorter-term price flow.

    The 11-, 15- and 20-minute measures take on a somewhat intermediate role, helping to confirm the direction the 30-minute baseline by their positional relationship to/with it (opposite the 45-, [50-] and 70-minute measures) thanks to their being less sensitive to the influence of relatively fleeting price action; while also helping to confirm the direction of the three or four fastest measures for the exact same reason.
     
    Last edited: May 31, 2022
    #775     May 31, 2022
  6. expiated

    expiated

    SWING TRADING WITH NUMERICAL PRICE PREDICTION
    Wednesday | June 1, 2022


    I have established that, for me, the 30-day baseline is the backbone of intraday trading, with approximately thee faster moving averages and three slower moving averages helping to clarify its direction, and a set of supersonic or granular trend lines cycling above and below it.

    That being settled, I'm wondering… "Can I identify a singular baseline within the context of swing trading with this same kind of role and those same kinds of relationships?"

    If so, it seems to me that it would have to be between five hours (i.e., the slowest measure I am using for day trading) and four days (i.e., the fastest measure I use to discern the general overall direction rates are headed on a daily chart).

    And so, my search begins…

    UPDATE …and ends the same day...

    ScreenHunter_11980 Jun. 01 15.04.jpg

    With the overall general flow of price conveyed by the two- and four-hour price range envelopes at the intraday level, I would say this compares with the two-day price range envelope in the context of swing trading, more often than not, between 1.00% to 2.00% deviation.

    And it appears to be the four-hour baseline that, like the 30-minute baseline at the intraday level, is accompanied by waves of candlesticks cycling above and below it, roughly along the two-hour (and one-hour) baseline(s), with entries best executed on the "back" side of the four-hour measure (assuming it is trending), preferably near or beyond the far side of the two-hour price range envelope at 0.20% deviation—but at the very least—the far side of the one-hour price range envelope at about 0.17% deviation.
     
    #776     Jun 1, 2022
  7. expiated

    expiated

    Thursday | June 2, 2022 | 9:26 AM PST
    I calculated my numbers wrong yesterday. Here is the relevant text with the errors hopefully corrected…

    With the overall general flow of price conveyed by the two- and four-hour price range envelopes at the intraday level, I would say this compares with the two-day price range envelope in the context of swing trading, more often than not, between 1.00% to 2.00% deviation.

    And it appears to be the eight-hour baseline that, like the 30-minute baseline at the intraday level, is accompanied by waves of candlesticks cycling above and below it, roughly along the two-hour (and one-hour) baseline(s), with entries best executed on the "back" side of the eight-hour measure (assuming it is trending), preferably near or beyond the far side of the four-hour price range envelope at 0.20% deviation—but at the very least—the far side of the one-hour price range envelope at about 0.17% deviation.

    Based on having just observed the effective role it played in making it easy to get the gist of general price flow on a previous chart configuration, I am now also including the 18-hour price range envelope at 0.75% and 1.35% deviation.
     
    Last edited: Jun 2, 2022
    #777     Jun 2, 2022
  8. expiated

    expiated

    Miscellaneous Notes:

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    The 30-minute baseline is the backbone of the Numerical Price Prediction system of intraday trading, with approximately thee faster moving averages and three slower moving averages helping to clarify its direction, and a set of supersonic or granular trend lines cycling above and below it.

    So, stated as simply as possible, the main idea is to look for 30-minute pullbacks in the 2½-hour price flow; and two- to eight-and-a-half minute pullbacks in the 30-minute price flow.

    In terms of swing trading, the basic idea is to look for two- to four-hour pullbacks in the eight-, 18-, and/or two-day price flow; and one- to two-hour pullbacks in the four-hour price flow.

    I would say that generally speaking, the most profitable trades will be had by entering positions of the "backside" of a trending 18-hour price flow. If this just so happens to be the backside of a trending two-day price flow as well, so much the better...

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    Last edited: Jun 2, 2022
    #778     Jun 2, 2022
  9. expiated

    expiated

    Saturday | June 4, 2022 | 10:15 AM PST

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    As a general rule, you want to be trading in the direction of the 18-hour price flow, especially whenever the two- and four-hour measures execute an about-face (or exit consolidation/accumulation) to resume a course in the same direction as this measure.

    Unfortunately, the measure can and will vacillate at times, so when the direction in which it is truly headed is not clear, it is a good idea to also consult the two-day price range envelope, which is subject to a certain amount of lag, but has the benefit of offering little to no ambiguity in terms of the direction in which it is sloping at any given moment; AS WELL AS CONSULT the eight-hour baseline, which provides almost 100% confirmation as to current intraday market bias/sentiment IF angled in the same direction as the two-day measure; and also helps to establish if a given pair is in the midst of an ongoing trend, or might possibly be in the initial stages of reversing direction.

    Usually, the 2½- and 1⅔-hour baselines are headed in the same direction. If this movement matches the trajectory of four-hour price flow, it would make little to no sense whatsoever to trade in the opposite direction, movement constituting price action that should probably be regarded as pullbacks until and unless proven otherwise; conveyed by the slope of the 20-minute baseline; verified by the slope of and its positional relationship with the 30-, (45- and 70-) minute baseline(s); and confirmed by its positional relationship above or below the usually fluctuating 5-minute trend lines, along with the 8½-, 10-, 12-, and 15-minute measures.
     
    Last edited: Jun 4, 2022
    #779     Jun 4, 2022
  10. expiated

    expiated

    Tuesday | June 7, 2022 | 1:15 PM PST
    ScreenHunter_11992 Jun. 07 12.53.jpg
    One of the foundational tenets or principles of Numerical Price Prediction is that "the best plans are usually established in the presence of a multitude of counselors."

    As of today, I am of the opinion that the core group of counselors advising traders employing Numerical Price Prediction as a day trading strategy are the 30-, 42-, 50- and 70-minute baselines...

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    #780     Jun 7, 2022