Variations on patterns distribution and combination

[Arteinvivo]

Thanks Sniper and how did your speculative activities go in general as me too i am using technical analysis but also my creativity to the max.

[Charlie201]

Arte , good to see you back and creating  , your ideas and efforts are always appreciated....Charlie

[sniper]

Hello Arte,
It's nice to hear you are a die hard technical trader. I started trading on the floor doing scalping using point & figure technique. When I left the floor and trade from the office I can't scalp because the commission and slippage will take a big chunk out of my profit. I could be right percentage wise but negative on the statement.I devise a trading method to suit my tolerance on loses. I cant' take big losses.I studied and tested most of the technical systems in the market and also tried using artificial intelligence. Nothing satisfied me, most of them work a certain time but none is consistent.I realized something crucial is missing. Being a blackjack player and a card counter, I am being exposed to numerous gambling strategy and money management technique.I then tried to merge the gambling technique and technical analysis. The outcome was successful and enabled me to make enough to retire for good.Basically I used  3 simple moving averages to identify the trend.I used pattern breakout from point & figure charting as entry and exit timing signal. I only trade in the direction of the moving averages.In this way we will ALWAYS get more WINNING trade than losing trade.I used a fix profit objective and equal amount on stop loss.I start with one lot, add one on a loss on the next signal. On a win minus one lot on next signal. Minimum trade is always one lot.I don't know if this method is still applicable in today's trading.Anyway I survive to tell the story,maybe I am just lucky for 20 years.

Regards

sniper

 

[Arteinvivo]

Hi Sniper, thanks for the feedback. These 3 little pesky moving averages are still popular today but also always late regarding price action. There are some differences between price action and a random stream of decisions. Have you noticed these differences ?

[pghilip]

Arte,

First, thank you for posting your ideas.  I have been trying to figure out your new update and improvement to the original idea....  Please post the rules or give examples how to play the improved version.

Thank You
Philip

[sniper]

Hello Arte,
I fully agree with you that moving averages are a lagging indicator.In my case I only used it as a filter.I did not bother about the crossing.I only look at the direction of the 3 MA's. Whenever all 3s were pointing upward, I will enter long when the short term timing indicator signal buying.The opposite is for short trades. By doing this my percentage of winning trades increased tremendously. I usually hit winning streaks trading this way.

Regards

sniper

[Arteinvivo]

Hello Arte,
I fully agree with you that moving averages are a lagging indicator.In my case I only used it as a filter.I did not bother about the crossing.I only look at the direction of the 3 MA's. Whenever all 3s were pointing upward, I will enter long when the short term timing indicator signal buying.The opposite is for short trades. By doing this my percentage of winning trades increased tremendously. I usually hit winning streaks trading this way.

I remember quite well at the beginning when i started to study the Forex market i just did not know by where to begin. What to look for? It was like landing in a completely new country without any maps. Someone suggested i should have a look at Hector Trader's web site which i did and it was quite a shock for me to learn new ways of considering price action as at first i was looking at price movement rather as a random chaotic stream of datas. I really like how Hector describes our Job as a trader :

...the job of a trader is similar to that of a detective. Before jumping into action, meaning entering a trade in the case of a trader or arresting a suspect in the case of a detective, there is a long job of investigation, sniffing around, considering different hypothesis, analyzing evidences, etc. Just as a detective doesn't quite get out there to arrest the first folk walking by, a trader doesn't quite pull out a chart and enters a position right away. Like I said before, there are plenty of things to do before that.

Hector helped me make my first steps into this Foreign country of the FX market. Some months later a professional trader with whom i used to discuss gambling systems and probabilities offered me to instruct me how to play the game as a pro. It was a privilege for me to get his assistance and it still is. It's unbelievable what i have learned over the past 8 months and what i can do with this knowledge. I always wanted to work from home and this FX market was the answer i was looking for. Knowing what i know now i would never attempt to learn the FX market without a mentor or a serious program which offers such help. It is just too much work to do by oneself. And having someone who can help speed the process dramatically.

[J.Daniels]

Nice website arte,

I am starting to read about trading, and having an overview. There is something that i would like to quote from his website, which i find interesting cause we can apply it to the game of roulette:

"FAQ #7 - Is It A Mechanical System?

No, by no means I trade a mechanical system. In fact I don't believe in mechanical systems at all - I am sorry guys, but I am afraid trading is not so simple. No-one will ever make consistent money off the markets by trading something like: " when the 14 EMA crosses above the 34 EMA, and the MACD goes positive and the RSI curls above 30, then go long ". I must be honest with you folks: that doesn't work, regardless of what any savvy marketing wizard and his shinny cherry-picked historical charts tell you. Guys, let's try to think clear here for a moment: if anyone could make consistent profits from a mechanical system, don't you think that largest institutional players (you know, the people with the beefiest computers and with the resources to hire the best programmers and mathematicians) would utterly dominate the trading world? if trading was so simple that mechanical systems were consistently profitable, don't you agree that small fishes like us would never have a chance?

The cold truth is that newcomers always search for mechanical systems because they are indeed simpler to follow than discretionary methods. In a mechanical system, you don't need to learn how to interpret trends, how to identify levels of support and resistance or how to read price action; you simply follow the signals given by a combination of grandiloquent indicators and you're good to go. Needless to say, most newcomers fail to ever make a living out of trading."

JD

[Arteinvivo]

The philosophy of this guy is in line with mine too. To trade successfully you need to be good at pattern recognition as most of our analysis is done using visual clues only.

[J.Daniels]

Arte,

Could you explain what makes the difference between roulette and trading ?

Both can be in a graph..

JD

[Arteinvivo]

Arte,

Could you explain what makes the difference between roulette and trading ?

Both can be in a graph..

JD

Good question J.Daniels, i'll use an analogy. Imagine a Casino where there are only roulette tables with no zero. Let's pretend 6 to 8 of them are very popular and visited by thousand of visitors but the organisation of the Casino is such that you can place a bet on all these tables at the same time or target just one of these at a time when you see what appears to be a good opportunity. The minimum bet amount can be as low as 1 cent to a max of 1 followed with many 0  This is for the organisation only. Next you have price movement or price action as it's called. It's chaotic but it is not. Price action will show personality traits or characteristics you can exploit on a daily basis while with roulette no such patterns are as reccurents. It's like looking at people from foreign country. Each of them will show different traits but you'll always be able to say he is chinese or african or American or French. See what i mean ? With roulette it's as if many different persons from different origins had decided to get together and produce a new breed of children with no discernable traits. With roulette it's like trying to look at an object which has no fixed propriety and is able to morph into something else each day. While if you look at a chinese person he can't look as an italian or change traits at will. This is the big difference and why you can make money long term without having to resort to use a martingale or other inneficient tactics. Oops! i almost forgot. You don't need to go out of your house to play the game. For me going to the Casino takes 2 1/2 hours so back and forth it is 5 hours that are lost. But as gambling, to speculate successfully you need to be psychologicaly strong. And finally, you don't do this business for entertainement. I have better fun pass-times for this.

[J.Daniels]

Great answer Arte,

I would definitely go further and study it. Its a good thing you safe time which, as we all know, equals money.
I wonder if I could email you for some help from time to time if its possible..  I would really appreciate it.

JD

[sniper]

Arte,thanks for sharing.I like your ideas and approach.I will study further regarding your advise.Probably it's been a long time since I last traded and most of my method is obsolete.

Thanks & regards

sniper

[Arteinvivo]

Arte, it sounds unnecessarily complicated.  If you agree that no matter what you do you may have to handle at least 5 losses in a row.

Then, why not simply select one pattern from the 32 and play that.  31 ways to achieve at least a win in 5 outcomes, win and 1 way to lose 5 bets.

First, it is not complicated for someone used to handle numbers or patterns. Secondly, i am not looking at it as the final answer to the game but just as a technique to capture all kinds of patterns that exhibit symmetry. That was my original objective and in this regard it is successfull. This is probably the best and easiest way to capture elegant patterns. Now, whether it will make you win or not depends on two things. 1) your luck 2) good timing. But this is just the preliminary part of a more sophisticated approach i have in mind. For example using patterns of four items or hands or 2^4 combinations you can use them in a very efficient way and get a lot of wins considering it's a pure game of chance 50/50.

Here is an example: over +4 standard deviation. That my friend if very rare. And all this by using just a little bit of complexity. This is not for the lazy person intellectually speaking.

[lucky_strike]

What i nice result you got there Arte

Cheers Lucky Strike

[lucky_strike]

-