BBands pull back can make lot of money for you-if you know

#12
Hi friends

here let us see about timeframe that looks best to trade.

HTML:
Trading process

see chart(visual action)
understand(mental action)
analyse-decide(brain RF)( correct action only possible after lots of practice)
Permission granted by Subconscious mind- master controller

ACT
fingers put order

OK
Now trading on 1 minute chart
trader type= NOVICE-NO IDEA OF WHAT TO DO
1 Looks at chart
2 cant understand
3 mind has no previous info in library-it is blank
4 analysis-decision-locked up in endless loop
5 time- going on 
6 Subconscious mind- reject orders  given
real time market action
trade progresses from neutral to high profit zone
Trader fed up takes random entry at resistance- high supply zone
trade reverses
money lost

Moral of the story
trader has no analytical ability or system understanding.
Lack of ruleset and lack of repetitive observation on the system
trader hndicapped
1 minute is not enough for him to achieve or implement any task
NOT QUALIFIED BY SKILLSET HE POSSESSES TO TRADE 1 MIN TIMEFRAME

TRY 10 MIN OR 15 MIN  OR 20MIN OR 30 MIN
CHECK YOUR RESPONSES
EVALUATE YOURSELF
CHOOSE RIGHT TIME FRAME THAT MATCHES YOUR NATURE
YOU CAN TRY   7MIN,12MIN,24MIN ETC

IF YOU CHOSE 12MIN TF,YOU LOOK AT CHART ONCE EVERY 11MINUTES 30 SEC. SET A BAR COMPLETE ALERT
TAKE REQUIRED ACTIONS-ADJUSTMENTS
SET & FORGET
THINK HOW YOU CAN SET THIS PROCESS RIGHT
STAYFREE of staring at screen
learn to act
 
#13
Hi KelvinHand

Here are some special comments.
Take time.
give your unbiased opinion

I don't find Bollinger Bands that useful -
when price gets to the extremes,
they simply widen to accommodate more movement.




HTML:
specialist comment-you can verify in live market

I don't find Bollinger Bands that useful - 
when price gets to the extremes, 
they simply widen to accommodate more movement.  

===The tunnel of 5's does something different, though - 
it's job is to help filter out the noise and false starts,
 and also to help keep you in trades longer and separate normal retracements from reversals.

Tunnel of 5's is a combination of two moving averages:

5-period smoothed moving average applied to the highs
5-period smoothed moving average applied to the lows

(if your charting package doesn't have smoothed MAs, then use exponential)

The idea is that you want to be trading Outside of this tunnel. 
 The tunnel can also show you a "squeeze" prior to a break-out forming, 
which is part of the reason--" I do no need Bollinger Bands up on my chart"-


 (in fact, John Bollinger himself once told me that " the best use of his bands is in option spread pricing, NOT in fx trading)."

Many people "over trade" in that as soon as they get out of a long, they look to go Short, AND vice-versa.

  The Tunnel of 5's forces you to wait, to see if the reversal is really in fact a reversal.  Sort of acts as a buffer zone.  AND, by the time price works it's way across AND comes out the other side of this tunnel, chances are if you compare with your longer timeframe (multiple timeframes, don't forget), 
that will give you permission to change directions as well.
  The two work together quite nicely. 
(No trade while price is inside the tunnel--PERFECT CLARITY)
 You will find many moves accelerating once price moves to the Outside of the Tunnel of 5's - 
this is because most bank traders are watching these levels, 
AND consider a move "confirmed" 
(AND jump on board themselves) once they see this.

The other function of the Tunnel of 5's is to distinguish 
between the end of a move AND
 normal market "breathing".  
So if you're already in a trade, AND price starts moving against you, 
the Tunnel of 5's can either give you the confidence to stay in longer (as long as candle bodies
 continue closing back Outside of it),
 OR tells you to perhaps consider abandoning your position early,
 ahead of target (if the Tunnel of 5's is breached with a candle body Close).




Compassfx has a code for HeikinAshi and smoothed ma of 5 period highs and lows. alternatively,Dean Mallone recommends EMA8 of highs and lows
i DONT HAVE IT. will find it.

Why all this trouble?
Becoz I dont want the bands to move along with price extremes-bands need to be steady & form a reference not dynamically moving but sort of firm one like a wall.




Above shows PAC price action channel for Nifty JULY FUTURES 10 minutes
KEEP IT SIMPLE-CLEAR
 
Last edited:

KelvinHand

Well-Known Member
#14
Hi KelvinHand

Here are some special comments.
Take time.
give your unbiased opinion

I don't find Bollinger Bands that useful -
when price gets to the extremes,
they simply widen to accommodate more movement.




HTML:
specialist comment-you can verify in live market

I don't find Bollinger Bands that useful - 
when price gets to the extremes, 
they simply widen to accommodate more movement.  

===The tunnel of 5's does something different, though - 
it's job is to help filter out the noise and false starts,
 and also to help keep you in trades longer and separate normal retracements from reversals.

Tunnel of 5's is a combination of two moving averages:

5-period smoothed moving average applied to the highs
5-period smoothed moving average applied to the lows

(if your charting package doesn't have smoothed MAs, then use exponential)

The idea is that you want to be trading Outside of this tunnel. 
 The tunnel can also show you a "squeeze" prior to a break-out forming, 
which is part of the reason--" I do no need Bollinger Bands up on my chart"-


 (in fact, John Bollinger himself once told me that " the best use of his bands is in option spread pricing, NOT in fx trading)."

Many people "over trade" in that as soon as they get out of a long, they look to go Short, AND vice-versa.

  The Tunnel of 5's forces you to wait, to see if the reversal is really in fact a reversal.  Sort of acts as a buffer zone.  AND, by the time price works it's way across AND comes out the other side of this tunnel, chances are if you compare with your longer timeframe (multiple timeframes, don't forget), 
that will give you permission to change directions as well.
  The two work together quite nicely. 
(No trade while price is inside the tunnel--PERFECT CLARITY)
 You will find many moves accelerating once price moves to the Outside of the Tunnel of 5's - 
this is because most bank traders are watching these levels, 
AND consider a move "confirmed" 
(AND jump on board themselves) once they see this.

The other function of the Tunnel of 5's is to distinguish 
between the end of a move AND
 normal market "breathing".  
So if you're already in a trade, AND price starts moving against you, 
the Tunnel of 5's can either give you the confidence to stay in longer (as long as candle bodies
 continue closing back Outside of it),
 OR tells you to perhaps consider abandoning your position early,
 ahead of target (if the Tunnel of 5's is breached with a candle body Close).
http://i40.tinypic.com/xf5cex.png[/IMG]"]http://i40.tinypic.com/xf5cex.png



Compassfx has a code for HeikinAshi and smoothed ma of 5 period highs and lows. alternatively,Dean Mallone recommends EMA8 of highs and lows
i DONT HAVE IT. will find it.

[B]Why all this trouble?
Becoz I dont want the bands to move along with price extremes-bands need to be steady & form a reference not dynamically moving but sort of firm one like a wall.[/B]


http://i40.tinypic.com/2j2xncy.png"]http://i40.tinypic.com/2j2xncy.png
Above shows PAC price action channel for Nifty JULY FUTURES 10 minutes
KEEP IT SIMPLE-CLEAR[/QUOTE]


Remember this: 5-period smoothed moving average is actually 9-period exponential moving average. You superimpose and see. not much diff with 8EMA.

OK. if you find this suitable to you. You can also combine with the bollinger band. You can use Keltner Channel also, no that widening.

Using the BB was tried find out the basis of alpeshpatel. It did not find the BB tally with his chart.

I don't think his method find the extreme, you can see that after the entry
it can go up future and then reverse, it had to had the money management with it.

There is some usefulness of SMA50 BB:
- It serve as a Take profit area, MidBand as 1st T/P and OuterBand as 2nd T/P
- SMA50 reaction to Price Action from current and the higher time frame.

Purfect Example:
[IMG]http://i.imgur.com/ibfJ1u4.jpg

The only issue is what the content of alpeshpatel arrow indicator to pin point the entry. Who know It may OBOS indicator to sync with the Outer Band.

I shown you the TDI and also the pfb_OSOB, that could be another way of judgement. Definitely, not every location is right. but likely possible with Support and Resistant area.

And the title is contain Pullback element, but his chart maybe did not reveal too much information. The is one possibility of the price reaction to the SMA50 on the higher time frame but react as price reversal at the band extreme.

Study that and see.

Based on your above chart, since you are not taking the close price after break out the tunnel, then no issue.
There could be cases that the break out , trigger out entry but back into tunnel or break out the other side

Lucky to find this example after the above statement to illustrate to you:

Assume you like KISS, and with your only 5SMMA tunnel, you could had enter:


That is why your Post #13 is historical data, you know where to place the entry.

Some people will take long instead of the short.
What is your confirmation to take short ?
 
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#15
Hi KelvinHand

Thanks for the nice charts proving the point.
--------------------------------------------------------------------
YOUR COMMENTS WORTHWHILE FURTHER INVESTIGATION
The only issue is what the content of alpeshpatel arrow indicator to pin point the entry. Who know It may OBOS indicator to sync with the Outer Band.

I shown you the TDI and also the pfb_OSOB, that could be another way of judgement. Definitely, not every location is right. but likely possible with Support and Resistant area.

And the title is contain Pullback element, but his chart maybe did not reveal too much information. The is one possibility of the price reaction to the SMA50 on the higher time frame but react as price reversal at the band extreme.

Study that and see.
----------------------------------------------------------------------------------------------------------------------------------------------------
May be I need to plot 30min htf support resistance on 15min chart and see.


I think I am sort of confused.

Mean Reversion -reversion of price to the mean or value area
or
breakout-Price cross the upper band or lower band creating trading opportunity

Alpesh was referring to reversion using bbands around 50ma and price pullback from extremes on either end.
With bband of 50 periods,price cant breakout -it can only reverse most often.

reversal detection.

DeanMallone refers to breakout-breakdown method using 9ema bands.
trend detection after squeeze in lower timeframes-may be.

My vote goes to method that has high clarity,simplicity,ease of trader following it.

I remember some old friends complaining of confusion & frustration due to
moving away of bollinger bands and missed trades-incurred losses etc.
There may be a way to shield from this behaviour of bbands.

Let me find some clarity with myself.
need time and hints to move out of my confusion band!
A trading method we follow needs to be easy on decision making,less on number of lines on chart,fast enough to see-understand-decide-act.
In fact not much thinking to be done when we trade with our favourite system

My motive-objective is not restricted or limited to the title pullback but is finding that keep it simple trading style or method that goes easy on the trader mind.
regards
ford
 
Last edited:

KelvinHand

Well-Known Member
#17
Hi KelvinHand

Thanks for the nice charts proving the point.

I think I am sort of confused.

Mean Reversion -reversion of price to the mean or value area
or
breakout-Price cross the upper band or lower band creating trading opportunity

Alpesh was referring to reversion using bbands around 50ma and price pullback from extremes on either end.With bband of 50 periods,price cant breakout -it can only reverse most often.reversal detection.

DeanMallone refers to breakout-breakdown method using 9ema bands.
trend detection after squeeze in lower timeframes-may be.

My vote goes to method that has high clarity,simplicity,ease of trader following it.

I remember some old friends complaining of confusion & frustration due to
moving away of bollinger bands and missed trades-incurred losses etc.
There may be a way to shield from this behaviour of bbands.

Let me find some clarity with myself.
Need time and hiNts to move out of my confusion band!

regards
ford
Any system that you want to use, you need to train yourself in simulator mode till
you subconsciously confident. When in live trade, auto pilot mode and no doubt is required.

BBand there are many ways.
1. Breakout
2. Trend pullback
3. Reversal (more difficult to do)
You may be see HTF Trend Pullback and LTF Extreme as illustrated OR
HTF Extreme and LTF Extreme together

Not to confuss you, you see it as Support and Resistance Reaction will do.
If you know Basic EW then will be good.

The chart shown pullback to higher timeframe, there is a horizontal SnR (maybe supply n demand, pivot, fibo..etc) not known to you.

Don't forget some people trade believe TA - 50MA x 4 is 200MA, 50MA trend ... etc
 
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#18
Hello Ford & Kelvin

Nice discussion.

For the Intraday channel (MA of high & low), i use a dynamic number for the period

i.e. 2 for for the first bar, 3 for bar 2 and so on till the max (10-12 your choice)

This way for first hour, the MA is not influenced by yesterdays action, only yesterdays last bar is used


:) Happy
 
#19
Hi Happy singh

Thanks.

How does this kind of intraday channel look like?
How to code such dynamic channel?
If the High on each bar gts increasing n, whatabout lower band,Low gets same sequence of numbers-i think.

worth exploring
please post a chart and afl coding if possible

SEE MOVING TREND BANDS MADE OF Time series TSF
----------------------------------------------------------------------------------------------------
//Formula Name: Moving Trend Bands (MTB)
/*
Author/Uploader: Uenal Mutlu - uenal.mutlu [at] t-online.de
Date/Time added: 2003-04-08 21:00:27
Origin: Moving Trend: William Rafter, "The Moving Trend", TASC 1/2003 p38 The idea of Moving Trend Bands (MTB) is IMHO by me.
Keywords: Moving Trend, Bands, MTB
Level: basic
Flags: indicator

DISCLAIMER: Most formulas present in AFL on-line library are submitted by the users AND are provided here on an "as is" AND "as available" basis. AmiBroker.com makes no representations OR warranties of any kind to the contents OR the operation of material presented here. We do NOT maintain nor provide technical support for 3rd party formulas.
Description:

Around the Moving Trend Average an upper AND lower band similar to Bollinger Bands is implemented. Maybe this is even better than BB (?).
Formula:


*/
//==========================
/*
Moving Trend Bands (MTB) [experimental]
Written 030408We by [email protected]
Similar to Bollinger Bands, maybe better?
*/
// mid = LinearReg(C, Prefs(4));
mid = TSF(C, Prefs(4));

sd = StDev(mid, Prefs(4));
top = mid + 1 * sd; // check 1
bot = mid - 1 * sd;
top2 = mid + 2 * sd; // check 1
bot2 = mid - 2 * sd;

//Plot(C, "Moving Trend Bands (MTB) C", colorBlack, 1 + 8);//dots line 8+1
Plot(C, "Moving Trend Bands (MTB) C", colorBlack,styleBar,styleThick );


Plot(mid, "mid", colorBlue, 1);
Plot(top, "top", colorRed, 1);
Plot(bot, "bot", colorRed, 1);
Plot(top2, "top2", colorRed, 1);
Plot(bot2, "bot2", colorRed, 1);
-------------------------------------------------------------------------------------------------------------------------------


regards
ford
 
Last edited:
#20
HELLO Friends

Problem dealing with bband uncertain reversals at upper band or lower band?
Here we have remedy.

just add Ema3, Ema5 and Ema13 on the chart
RULES ARE

LONG IF
EMA3 AND EMA5 BOTH TOGETHER CROSSED ABOVE EMA13
NEAR CENTRELINE OF BBANDS
PRICE BREAKS ABOVE RECENT SWING HIGH

SAME PHENOMENA OCCURS AND MATURES IN IMMEDIATE HIGHER TIMEFRAME

FOR SHORT IF
nEAR UPPER BAND
EMA3 AND EMA5 BOTH CROSS BELOW EMA13
PRICE BREAKS BELOW RECENT 3BAR SWING LOW
FOR MORE CERTAINTY WAIT FOR SAME THINGS OK ON IMMEDIATE HTF


SEE CHART

 

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