<i>"Obviously by always being on the right side of the market, ..."</i> Jack, much as I respect all your effort thru the years, at least two of us here know that the word "always" above means at best "mostly" in real life. We wouldn't want to raise the bar of expectations too high for people to hurdle, when in fact success doesn't even remotely depend on being right all the time. Pursuit of perfection kills more budding traders than most any other affliction we can think of. Gotta be careful not to foster such a mistaken belief
Thanks, but that's too difficult. I'm not interested in spending screen time to learn how to do something. I just want something I can see below a chart with a binary buy or sell signal. Something in the area of 95% correct would be great. But 80% would be okay if the risk:reward were something like 1:3. TIA
You may be interested in the "refined MACD" indicators: http://www.journal.au.edu/abac_journal/2001/may01/refined.pdf
A person can sit down and pick his degree of sensitivity. Financial advisors do that with their clients. The client comes in to rebalance his portfolio occationally. This periodic adjusting is what Warren Buffett does as well. For me this is always what goes on in this setting. People who have jobs stay on the right side of the market by keeping jobs for so long and then changing jobs. For me this is always whats going on in the job markets with workers. The subject of being right all the time is now on the table here. I see trading as a six stage affair going from Assessor (looking at it) to Expert. Beginner, Advanced Beginer, Intermediate, Advanced Intermediate and Expert comprise the active stages where money is used. It all begins with a lot of ignorance spread across heritage. At any stage after assessor a person has the skill to be on the right side of the market in my opinion. I think in terms of always. Pursuing perfection, I believe, is an attitude that you associate with the dynamic process of following a curriculum or syllabus. Most of the time neither is being followed by Assessors or perhaps Beginners whom we can call budding traders. So they are probably mostly learning failure since the bar is quite low. I am posting in ET. And rarely if ever, I get cautioned about things. Taking meds and laying off scotch suggestions happen as well. Here I tlked about staying on the right side of the market and I wnet further; I said always stay on the right side of the market. I see assorted people on various skill levels that they came to by spending time (gaining experience) to acquire knowledge and skills. In this key endeavor, I am suggesting making it one's business the always stay on the right side of the market as part of this investment in time and energy. To explain better, what I am saying is that everything a person does has to include a component of staying on the right side of the market. Recently someone had a hardon (that is my sense) about his believf that everything was included in PA and for days no one said that anything was missing from the completeness of PA nor was there anything that could add to PA that wasn't already in PA. He is definitely stuck where he is and not acquiring knowledge and skills and he repeats experiences. To see if you are on the right side of the market turns out to be more of an affirmation than an analysis, in my opinion. This makes for filling in logs with C's and X's, meaning continue and change,respectively. The X means that you have to act to change the right side of the market. How many rows on a log have X's one after another? That depends on sensitivity and not perfection and not how high the bar is set. My illustration today of the 10:00 report from ISM shows seconds passing on the T&S. Many over 50 contract rows peel up on the T&S. Most people take 100milliseconds to sense. 10 senses a second and most of it is stored in unconscious parts of the mind. Only skilled traders can make a lot of money since they do not have losses except for external types of failures. People who are largely ignorant (which is a normal thing for someone new to anything), no matter how dumb and stupid (usually a personal choice for a life style) can spend their time keeping in mind that each little thing they do has a component of thinking about what they are sensing with regard to what side of the market is the right side. By looking very empathetically at each one of these people, I see their buds. They all have buds that grasp and sense the two sides of the market. While percolating along, they could be (and I am posting that I insist that they) always deciding if they are on thewrite side of the market just as they complete taking their monitoring data set. What if a peson have 13 locations on his display, each of which displayed symbolically or otherwise, the right side (of two sides) of the market. Allen hobbs states he gets inthe trade and immediately figures out he does not know what is going to happen. He askes many Q's about how to set stops because of his circumstance. The way I saw it (and my post was deleted by the moderator) was that he might have considered dealing with knowing what side of the market he was on all the time. If a stop is hit, we both know that the person does not know what side of the market he has been on recently and up to the present. here is sopmething that has a lowly set bar of performance associated with it. A person enters. He also sets a stop. from that point on as an assessor paper trading or a beginner with 3 contracts riding, he may be able to notice whether or not he is headed towards his stop. If he is able to be that aware of things then he is capable of alwys staying on the right side of the market. We know that allen has a two minute limit on holding that is imposed by his lifestyle stree and participation limits of being in he market. He is sidelined 99% of the day, roughly speaking. What is during 99% of the day he didn't quit and he simply, without risk logged the right side of the market, debriefed in a different color to see where he wasn't on the right side. He could do a profile of his progress on becoming aware of the right side of the market for RTH's and have a personal hitory of his purposeful budding and how many buds he was acquiring. Right now he is telling me I misssssspell words because I am drinking too much scotch. So I know, as someone said, I wreck 2880 people a day by irresponsibly posting things. What I post sets the bar too high because it wrecks budding traders who have chosen to afflict themselves with the thought that they are actually striving for perfection. Striving for perfection isn't a good Idea at some stages of trading learning, you suggest. Here I have tried to water down what effort could be made to always stay on the right side of the markets. I know many people will read and ignore this. I have learned to accept their decisions. Maybe in 48 ours or two weeks or 6 months they will reconsider. I regard a lot of things as works in progress. It is certainly true that wearing safety glasses around here is a good idea. There is a lot of chipping away at things that is required to even get a potential shape to begin to form.
400,000 runs with PVT yielded 8.08 days as the hold period. As you suspected how you decided on the sample to test, gave you that equity curve for your backtest on that sample. Here is something you may want to consider. Take off your shelf the Meeting 5 Background paper for the IBD Meet UP Tucson* It was updated in October 2006. Use the original video as a reference for this illustrated transcription. The update in the text is in bold print and 30 some additonal illustrations are included. All of this will help you in several ways. It is your choice to use the help or not use it. *Putting the Pieces Together is the short title and ,as usual, it was published by Adobe Llamingos, 77 pages.
As mentioned earlier, 12/26/9 is too wide to trade with. It should be used to identify the larger trend. Use a smaller MACD, such as 5/13/1, to identify the smaller trend. After some screen time you will notice that price itself will move before the indicator does. If your market has volume, you will notice that volume from the old trend will "dry up" When volume comes back, it will support the direction that price is trying to go. So, when you fully evolve as a trader, you will use indicators to confirm trades rather than make trades. Best Regards Oddi