boldtrader » Sun Mar 23, 2014 7:41 am wrote:Had a few minutes to read some of the updates while walking around New York City enjoying the many culinary delights.
I have been using a form of Traders Dynamic Index, which I call the Dynamic Strength Index (DSI), which I developed in 1998/1999 and have been using since. It signals ranging, trending, when to add on, when to close the add on, when to close the entire position. The TMA I have also been using almost since it was created. The best and most practical use of the dual TMA channels with which i have had the most consistency with is using the fib values. The TMA indicator I use alerts to when price moves outside of the channels and gives values of the range of the channels distance. The number one highest and most profitable technique which I apply to all time periods is to use the TMA with DSI, Octaves, and LRC channels trading back to MST price points. In 2000, I developed the use of automated Triple Linear Regression Channels which will alert to a continuation of price within a trend, in advance.
The trades almost never fail. If they do, it is mostly because I may see something to cause me to exit a trade early before allowing the trade to work out. What often occurs is the original trade would have performed better with higher results had I allowed the position to remain and allow the utilities to do their job as I had developed them. By adding the CSS with H4, these two tools provide additional confirmation of my original utilities. I have one last algo I developed to alert to a pending change of a market condition, doing so in advance of those changes.
If I may offer some thoughts. Bob, you have developed some great tools. My experience is that changing the STO7 from 80/20 to 90/10 is going to vary with different pairs, based on different conditions and different time periods. Just like the dealer at the desk had different strategies for different periods, I think you will see the same with the STO7. What I did find that worked out the best across all time periods is the monitoring of the tools and their differential between periods. In this manner, it didn't matter if market was ranging or trending. The utility will adapt to the conditions. An additional benefit is the recognition of divergence in the market of price vs the algo. Without me saying much more, I will simply note that the current tools in play, ie: CSS,H4, TMA and TMA with distance which I posted, the MST levels, even the Octaves I use and the Triple LRC, at least for me... no changes need to be made. We will end up changing the tools and values to suit the market conditions, essentially chasing the end of the rainbow but never quite getting there. In my opinion, we are there, at least i am comfortable with how the trades and results are working out with the current settings for the current market conditions. My focus is about the timing of the trades when the market conditions are right for entry. I spent 7+ years trying to develop the right timing tool. What I learned was it was not about the timing tool, but rather the specific market conditions which occur based on the algo of the tool I developed. We could probably spend the next 5 years looking for better tools, the right tools, etc. chasing values, running back tests, essentially curve fitting to the markets. And when the markets change again in volatility, we will be looking for the next latest and greatest and spend another 5 years searching for values. I would prefer to keep what we have currently and focus on identifying the market conditions which meet the current tools / system in place. What does not change is Trend lines ( I refer to them as Trade lines) and how markets react to these lines, along with various repeatable historical market conditions.
This change of mindset allows me to focus on the trades and the market conditions, THEN, use the tools to confirm the trade, rather than trying to use the tool to give me the trade to make and then try to justify the trade based on market conditions. Example.. I know that when a market creates dual MST's and moves to certain fib levels, that the markets will return to certain levels to give very exacting trades. I have posted such examples here many times. 100% of each of my posts have hit their targets. Not a single trade failed. Entry of each trade could be confirmed with the CSS, TL, Octaves, H4 trend or counter trend and TMA. All trades were announced in advance. The tools / indicators confirmed what the price action showed in advance.
As a result of this mindset change, my overall performance greatly increased and my selection of trade choices reduced greatly while the overall quality of trades increased. This change of mindset will typically allow me to run 43-52 trades in a row between a loss. So at least for me, my postings (if still desired) will be based on the current system, which is not broken, using the current tools in place.
Since the CSS and H4 are not broken, I will continue to enjoy the great trading I have experienced since making them a part of my tool box.
Cheers.
