Parabolic SAR - that's all!

[frontier2002]

Originally Posted by dpaterso

Alright alright - I closed the position. You can all call me a 'chicken' if you want.

There was, however, method in my madness:

I had a look at the four hour chart i.e. one timeframe down and I noticed that Wilders' ADX is starting to move up, and Bill Williams' AC has two green bars showing already - and that almost always guarantees a trend reversal coming (at least on the Indices). I even added Stochs to be sure and they are also turning up.

Maybe this in itself is a good way of doing things i.e. work on the Daily / Weekly / Monthly charts but once you have opened a position monitor the four hour charts (or one timeframe lower than the one that you are working on) - that way you could get a warning that there is a reversal coming.

Anyway - I'm out (although I'll leave this same position open at my other broker and see what happens with it. Those are smaller and cheaper lots so if I lose a couple of $$$ it won't be anywhere near what I have just made).

What I will probably do now is wait and see what happens on the Weekly next week. If the first dot appears when the chart opens on Sunday I will go short again and then monitor the same indicators on the Daily Chart and see what happens.

Now don't get me wrong - I know this all sounds like I am going against everything I was trying to preach at the beginning of this thread. I'm not. It is just that this trade was a 'special' case because of the 'ferocity' of the fall. If it were not so 'violent' and 'huge' I would have stayed in this trade until I was stopped out by a Parabolic SAR dot. Shot dot!

Regards,

Dale.

I am intrigued by the use of Parabolic SAR indicator in trading, i meant i couldn't understand at all how people is using this thing. Is it more effective than the B. Band, Stochastic, MACD combination?

[isidrohg]

Hi, I don't want to look lazy, I'm reading this thread but +200 pages is too much :P, sorry if anyone already asked this question.

Does anyone tried SAR settings: Incremental Step = 0.01; Maximum Step = 0.2 ?
If you were using SAR to set your SL, then this settings seems to get you in a trade longer than the default settings, and not stop you early.

Regards

Isidro

[isidrohg]

Hi guys.

I want to share some backtesting I got from FXDD, from 01-01-2007 to 03-28-2008. I used SAR standard settings.

You see, I ran a test on every pair separately (Im not very familiar with MQL). The thing is, if you sum every net profit/loss there IS profit. Maybe not too much I dont know, maybe if we choose the correct lot size, doubling an account can be accomplished in a period of a year very low risk. What you think?

For this test I choose a lot size of 0.01.

By the way, Im not finish reading this thread :S (so many paaageeeeeessss!!!!), Im in page 181 I think. :P

[Dow2]

Hi all,

Just did a back test with MQL4 agaist EURUSD from 2005.01.01 - 2008.04.30, the result is like this.

Profit: -2361 (pips)
Trade: 107
Risk: 368
Win_rate: 32%
Reward: 189

Maybe I didn't get it right. but here is the trade system's logic.


RISK: Stop Loss Price = PASR Price
Time Frame: Daily
Entry: Go long or short the moment the first Parabolic SAR dot appears
Exit:The next Parabolic SAR dot appears in the opposite direction.

I am posting the source code here

[scottcap]

Quick question... when using fractals as a filter against sideway action do you count the last fractal if it falls between the SARS dots, or do you only count the last fractal if it is outside the SARS dots.

I am guessing you should only be using those fractals that are outside.

One more thing... do you chase the fractals? If a bar does NOT close above the last fractal (for a long position) but now paints a higher new fractal do you then use wait for a new bar to close above that latest fractal before considering looking for a buy point?

[dpaterso]

Hi,

The system as described is simple: if your last fractal is an up fractal AND you already have the Parabolic SAR parabola being drawn by the dots in the same direction then you place an order above the high of the bar that has just closed above your last up fractal (and the opposite for a short entry). Once in the trade you then follow it through to its 'logical conclusion' using Parabolic SAR. It doe not matter whether the fractal is 'inside' or 'outside' of the parabola i.e. it's the LAST VALID FRACTAL that you're looking at assuming that you're not already in a trade.

As stated previously though: I do NOT trade this system and it was just an idea that I 'threw out' for other people to expand upon if they so wished.

[scottcap]

Originally Posted by dpaterso

Hi,

The system as described is simple: if your last fractal is an up fractal AND you already have the Parabolic SAR parabola being drawn by the dots in the same direction then you place an order above the high of the bar that has just closed above your last up fractal (and the opposite for a short entry). Once in the trade you then follow it through to its 'logical conclusion' using Parabolic SAR. It doe not matter whether the fractal is 'inside' or 'outside' of the parabola i.e. it's the LAST VALID FRACTAL that you're looking at assuming that you're not already in a trade.

As stated previously though: I do NOT trade this system and it was just an idea that I 'threw out' for other people to expand upon if they so wished.

Thanks for your prompt reply!

If you are adverse to trading this particular method may I inquire as to what "system" you do find of interest?

I believe you initially began this thread indicating you were having some success trading parabolic sars holding multiple positions in the different currencies, or maybe I misread. I have not read all the pages in this thread so I may have missed any comments you may have made about what you find works, or does not work.

Regards,

Scott

[dpaterso]

Ok well here is where I've 'arrived at':

Trading Systems in 'New Concepts In Technical Trading Systems' by J. Welles Wilder

But before you even go there I STRONGLY suggest that you take the time and put in the effort of reading THIS entire thread. I promise you one thing: making it in this business is not as easy as the first few pages of this thread may (mis)lead you to believe!!!

[scottcap]

Originally Posted by dpaterso

Ok well here is where I've 'arrived at':

Trading Systems in 'New Concepts In Technical Trading Systems' by J. Welles Wilder

But before you even go there I STRONGLY suggest that you take the time and put in the effort of reading THIS entire thread. I promise you one thing: making it in this business is not as easy as the first few pages of this thread may (mis)lead you to believe!!!

I am well aware of how difficult it is....

I was one of the first to bring a computer into the commodity brokerage firm I use to work for 30 years ago to track price movements and still unable to find anything that works well enough to rely on.

At that time I predicted that one day the computer technology would allow anyone to trade from their home sucking millions into gambling on the various commodities.

Regards,

Scott

[dpaterso]

Hello,

My apologies to you then (of course I just assumed that because you had just joined you were new 'to the game' as it were).

I'm surprised that after that amount of time you still say that you've not found anything that can be relied upon?

Anyway: I have indeed found something that can be relied upon I assure you i.e. the work of J. Welles Wilder (and I would imagine that him you would have heard of i.e. he's probably more from your 'era' than mine by the sounds of things and was (is) exclusively a commodities trader).