NEW RULES: Extensive observation makes clear that, generally speaking, foreign currency exchange rates are willing to distance themselves only so far from certain key moving averages before being compelled to return to more typical deviation levels—distances I think of as “maximum degrees of separation” and refer to as “statistical support and resistance.” If this is true, to maximize the statistical odds or mathematical probability of executing successful trades, all an individual need do is refrain from entering positions until and unless the exchange rate of a given currency pair makes its way to such levels. It is on this contention that the 5-minute chart setup (not pictured) is based. As you can see, there are three key moving averages at the heart of the system: SMA (x), SMA (y), and SMA (z). SMA (z) functions as the day-to-day trend line, whereas SMA (y) tracks the intermediate or intraday direction of price. SMA (x) is less a reflection of the short-term trend as it is a quasi plumb line for gauging abnormally fast rates of acceleration. The idea is to only enter positions when the exchange rate has deviated from all three of these key moving averages to a statistically significant degree. To determine when such an event has occurred, check the lower panel indicators, collectively referred to as the Price Anomaly Channel. The channel’s outermost bands are called the outer walls, so of course, the inner bands are called the inner walls, with the upper walls thought of as ceilings and the lower walls referred to as floors. As a general rule, the only time it is permissible to enter a new position—the only time that a trade should be executed—is when all three oscillators have, at the very least, made contact with the inner ceiling or the inner floor of the Price Anomaly Channel.
This demo-account report might signify somewhat up a milestone for me. As unusual as it is when it comes to my daily demo account results, my average profit trade was actually greater than my average loss trade. This was not due to my setting tighter stops or to my refraining from placing orders and then walking away. Indeed, I strongly suspect it is because I am doing a significantly better job now of executing what my system is founded on, which is correctly forecasting the ultimate direction price will head in the near future based on how five carefully selected moving averages and six key (and corresponding) moving average envelopes relate to and interact with each other (and with the exchange rate) at any given moment. Nothing should change when I go back to trading my live account (which should happen within a number of days) because I will NOT be placing orders and walking away at that time, but will wait around for the precise moment I receive confirmation of a trend reversal (rather than simply rely on my supposed ability to interpret market structure, as I am doing presently). This WILL allow me to set tighter stops and will even enable me to exit positions BEFORE my stops are hit in those occasional instances where I see evidence of a false positive/head fake.
I’ve gone back of trading my live account now, but it took me about a week to figure out what I believe might turn out to be the final and ultimate iteration of my system, now essentially based on just two (or three, depending on how it’s implemented) carefully selected moving averages, and one key moving average envelope (not plotted on the chart, but represented by the lower panel indicators and the main chart’s dynamic support/resistance indicators—the Darvas-box-looking graphics). The first trade (below) was made before the chart existed and the remaining trades were made before the rules were established, yet the system was still profitable, though the performance was admittedly a bit shaky. Now that everything is in place I ought to be able to get the success rate above 80% and the average profit trade equal to or greater than the average loss trade. Here are the rules:
The system ultimately adopted for all my trading—Numerical Price Prediction (NPP)—is essentially the same as my Multiple Simple Moving Average Envelope strategy (MSMAE) from a year ago, except that what I was doing then was more dependent on the art or craft of trading (having a feel for when circumstances were such that it made sense to enter a position) whereas pretty much every facet of the decision making process is now quantified... It is my plan to fund an IQ Option binary option trading account with $10 at the end of this month (June) and attempt to double the balance at least every two days using what I hope to be a near perfect approach to trading that platform... Today's results when using the IQ Option tactics to trade my live OANDA account:
I did not go this route. I have instead been preparing to resume full-time trading through a regular broker (OANDA) in September. However, there is nothing more for me to do in that regard. The system is probably as near "perfect" as I can get it, so in the interest of finding something else to entertain me until next month, I have returned to this thread intending to follow Harry Boxer and see if I can't adapt what I'm doing trading Forex using Numerical Price Prediction so that it works just as effectively in the stock market.
There is nothing to do here. My charts are already set up for the major indices (futures) and the platforms to which I currently have access are not satisfactory for stocks, so I will need to find some other way to entertain myself...