Market paradox-be aware of it-read watch video

R

rvlv

Active Member
#1
#1
hi friends
HEAD FAKES?
I feel how to put this concept into an afl formula

WATCH.
Before a reversal at top,you find distance between close & high gets narrow.
before a reversal at bottom, the distance between close and low getrs narrower.
=======================================
TASK FOR CODING
PLOT 20BAR LOWS AND 20 BAR HIGHS
BUY AT 20BAR LOWS ON HEAD FAKE
SELL NEAR 20 BAR HIGHS ON HEAD FAKE
DETECTING HEAD FAKE IS THE CHALLENGE.
Hope some expert here will solve it out.
===============================================
http://www.youtube.com/watch?v=l7NdpInnai8
Ever heard of market paradox?

often in trading what feels good is wrong thing to do-& what feels bad & bitter turns out right thing to do.


market is made to move upwards by institutions to create better selling opportunities for strong hands( & trap weak hands).
market is made to go down to create buying opportunities for strong hands(& trap you and me-the weak hands)
How do you differentiate between real and fake? use major trend filter-use trendline.

when market is really going up, you find higher bottoms and major trendline slopes up.
===============================================
Think again how you can apply this below given information.
think cleverly-think beyond the obvious superficial stuff

Richard Dennis used 20bar high and 10 bar low method.
The summary was
it failed over 70% of the time and
it succeeded 30% of the time,
but whenever it succeeded,it made phenomenal amount of profits.

happy trading

Thinking unconventionally involves understanding market paradox and head fakes in the context of overall trend.

Lets see what our traders say on this
 
amitrandive

amitrandive

Well-Known Member
#2
#2
rvlv said:
hi friends
HEAD FAKES?
I feel how to put this concept into an afl formula

WATCH.
Before a reversal at top,you find distance between close & high gets narrow.
before a reversal at bottom, the distance between close and low getrs narrower.
=======================================
TASK FOR CODING
PLOT 20BAR LOWS AND 20 BAR HIGHS
BUY AT 20BAR LOWS ON HEAD FAKE
SELL NEAR 20 BAR HIGHS ON HEAD FAKE
DETECTING HEAD FAKE IS THE CHALLENGE.
Hope some expert here will solve it out.
===============================================
http://www.youtube.com/watch?v=l7NdpInnai8
Ever heard of market paradox?

often in trading what feels good is wrong thing to do-& what feels bad & bitter turns out right thing to do.


market is made to move upwards by institutions to create better selling opportunities for strong hands( & trap weak hands).
market is made to go down to create buying opportunities for strong hands(& trap you and me-the weak hands)
How do you differentiate between real and fake? use major trend filter-use trendline.

when market is really going up, you find higher bottoms and major trendline slopes up.
===============================================
Think again how you can apply this below given information.
think cleverly-think beyond the obvious superficial stuff

Richard Dennis used 20bar high and 10 bar low method.
The summary was
it failed over 70% of the time and
it succeeded 30% of the time,
but whenever it succeeded,it made phenomenal amount of profits.

happy trading

Thinking unconventionally involves understanding market paradox and head fakes in the context of overall trend.

Lets see what our traders say on this
Click to expand...
rvlv

Thanks for the concept and video.I think a simple trend line will be very helpful in identifying a head fake.

I really hope some senior codes this concept into an AFL.
:clap:
 
amitrandive

amitrandive

Well-Known Member
#3
#3
The MT4 indicator for this setup( I think :confused:), got from the net.

Need any expert to convert to AFL.

Code: 
//+------------------------------------------------------------------+
//|                                           Reversal_Indicator.mq4 |
//|                                                         Zen_Leow |
//|                                                                  |
//+------------------------------------------------------------------+
#property copyright "Zen_Leow"
#property link      ""

#property indicator_chart_window

// The number of buffers for calculation, up to 8
#property indicator_buffers 2

// The color for displaying arrows
#property indicator_color1 Green       // Long signal
#property indicator_color2 Maroon         // Short signal

// Width of the arrows
#property indicator_width1 2  // Long signal arrow
#property indicator_width2 2  // Short signal arrow

extern bool UseFullCandleSize = false;
extern int NumberOfCandles = 2;
extern int ArrowDistance = 3;

// Buffers for the calculations
double Up_Arrow_Buffer[];    // Long buffer for display
double Down_Arrow_Buffer[];   // Short buffer for display
int PipFactor = 1;
//+------------------------------------------------------------------+
//| Custom indicator initialization function                         |
//+------------------------------------------------------------------+
int init()
{
   // Cater for fractional pips
   if (Digits == 3 || Digits == 5)
   {
      PipFactor = 10;
   }
//---- indicators
   SetIndexStyle(0, DRAW_ARROW);
   SetIndexBuffer(0, Up_Arrow_Buffer);
   SetIndexArrow(0, 233); // Up arrow
   SetIndexStyle(1, DRAW_ARROW);
   SetIndexBuffer(1, Down_Arrow_Buffer);
   SetIndexArrow(1, 234); // Down arrow
//----
   return(0);
}
//+------------------------------------------------------------------+
//| Custom indicator deinitialization function                       |
//+------------------------------------------------------------------+
int deinit()
{
//----
   
//----
   return(0);
}
//+------------------------------------------------------------------+
//| Custom indicator iteration function                              |
//+------------------------------------------------------------------+
int start()
{
   int i;                           // Bar index       
   int Counted_bars;                // Number of counted bars
   //--------------------------------------------------------------------   
   Counted_bars=IndicatorCounted(); // Number of counted bars   
   i=Bars-Counted_bars-1;           // Index of the first uncounted   
   
   while(i>=0)                      // Loop for uncounted bars     
   {  
      Up_Arrow_Buffer[i] = EMPTY_VALUE;
      Down_Arrow_Buffer[i] = EMPTY_VALUE;
      
      if (isUpReversalCandle(i))
      {
         Up_Arrow_Buffer[i] = Low[i] - (ArrowDistance * Point * PipFactor);
         Down_Arrow_Buffer[i] = EMPTY_VALUE;
      }
      if (isDownReversalCandle(i))
      {
         Down_Arrow_Buffer[i] = High[i] + (ArrowDistance * Point * PipFactor);
         Up_Arrow_Buffer[i] = EMPTY_VALUE;
      }
      i--;
   }
//----
   return(0);
}

bool isUpReversalCandle(int index)
{
   if (AllDownCandles(index))
   {
      if (UseFullCandleSize)
      {
         if (High[index] - Low[index] > High[index+1] - Low[index+1])
         {
            return (true);
         }
         return (false);
      }
      else
      {
         if (Close[index] - Low[index] > Close[index+1] - Low[index+1])
         {
            return (true);
         }
         return (false);
      }
   }
   return (false);
}

bool isDownReversalCandle(int index)
{
   if (AllUpCandles(index))
   {
      if (UseFullCandleSize)
      {
         if (High[index] - Low[index] > High[index+1] - Low[index+1])
         {
            return (true);
         }
         return (false);
      }
      else
      {
         if (High[index] - Close[index] > High[index+1] - Close[index+1])
         {
            return (true);
         }
         return (false);
      }
   }
   return (false);
}

bool AllUpCandles(int index)
{
   for (int i=index; i<index+NumberOfCandles; i++)
   {
      if (!isUpCandle(i))
      {
         return (false);
      }
   }
   return (true);
}

bool AllDownCandles(int index)
{
   for (int i=index; i<index+NumberOfCandles; i++)
   {
      if (!isDownCandle(i))
      {
         return (false);
      }
   }
   return (true);
}

bool isUpCandle(int index)
{
   if (Close[index] > Open[index])
   {
      return (true);
   }
   return (false);
}

bool isDownCandle(int index)
{
   if (Close[index] < Open[index])
   {
      return (true);
   }
   return (false);
}
//+------------------------------------------------------------------+
 
R

rvlv

Active Member
#4
#4
hi
here is a chart.
The chart uses hhv 20 & llv20 lines.
chart also uses kama 20 period high and kama 20 period low lines.

kama hi and low show adaptive high and low levels.

The kama 20 hi-kama 20 low lines come inside the hhv 20 and llv20 lines.

the market context is a bit easier to see.

when price falls below kama20 low line bias is short and confirmation comes from hhv20 and llv 20 lines stepping down.

when the price rises above kama20 high line,market bias is long and confirmation of uptrend comes from higher highs and higher lows of hhv20 & llv20 lines.

the kama lines can act as stoploss lines.


===================================================

The question we pose ourselves is simple but answer is complex.
the question is

with a 20bar high and 20 bar low tracking & price, with 70% failure rate and with 30% success rate,how do we judge market context more reliably and take advantage of itso that the 70% failures go with minimal losses leaving us high profit trades?
 
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