What Every New & Or Aspiring Forex Trader... Still Wants To Know

Beginner Questions
4353

Hello, Pajo

I’m using 5pm New York time, which [B]currently[/B] is 2100 GMT (beginning November 6, 5pm New York time will be 2200 GMT).

No weighting.

I am presently experimenting with a linear regression line drawn on the Daily ATR(2). That is, my trading platform will draw a graph of the daily average true range (Daily ATR) averaged over any number of days that I specify (from 2 to 200). I’m using the shortest average available, the Daily ATR(2). Then I’m overlaying a linear regression line, and simply reading the pip-level of the linear regression line where it intersects the centerline of each daily candle.

You may have noticed the linearity of the ADR figures that I posted. Until the linear regression line changes, those figures will continue to be linear in their relation to one another.

Over the very recent past, the Daily ATR(2) exhibited lower highs and lower lows between 8/1/11 and 9/2/11. Then, it exhibited higher highs and higher lows from 9/2/11 through 10/7/11. From 10/7/11 through yesterday, the Daily ATR(2) has once again exhibited lower highs and lower lows.

Accordingly, the linear regression line superimposed on the Daily ATR(2) is a series of three line segments, end to end. The first (8/1/11 - 9/2/11) slopes downward; the second (9/2/11 - 10/7/11) slopes upward; and the third one (10/7/11 - present) slopes downward.

The linear regression line indicates an ADR of 126 pips for today (5pm Wednesday - 5pm Thursday).

Edit: I have corrected the ADR for today.

4354

I understand. I assume you have these figures on a spreadsheet right now and are calculating the difference between the different Algos and the actual ranges? It seems your new Algo comes closest, but we couldn’t actually say which is more profitable without having *taken exactly the same LC trades over the same period of time.

Regards

EDIT: *Sorry, I meant having traded the same pairs on the same days.
EDIT 2: No! Just looked at the same pairs on the same days! I am confusing myself now :wink:

4355

I figured out the ADR and DP macros. There should be an accessable video on how to add indicators such as this to mt4 cause I was all over the place haha ne ways keep up the good work,

4356

Just finished reading the whole thread and just wanted to say thank you again to everybody contributing here. September i found Babypips and the School of Pipsology and started with the demo in october. After a few days, i also came across this thread and quickly began to realise the value of the information in here. This is my october so far and im very happy about it!

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4357

Couple of things I was thinking:
So tonight there is a free candlestick webinar hosted by Steve Nison. All the educational material on his site, is somewhat costly, so I think it will be interesting to see what the content of the webinar is like.

One of the many things that I really like about this thread (the main being the great community that tries to help one another succeed) is that ICT teaches the analysis of price movements directly from charts. It feels to me like this approach is more pure and closer to the heart of things. Over the months I’ve checked out various indicators, patterns, etc. I know everything has it’s value and that we are all looking at the same things from slightly different perspectives. However, I don’t understand why there is such emphasis placed on things like the harmonic patterns (though they’re harmonic) like Gartlies, Butterfllies, etc. I don’t dispute that people should use whatever works and clicks for them. But, is it not much easier to focus more on highs and lows per session, per week, market flow, and pivots etc, and try to identify OTE’s in this manor. Is it not more sensible and productive and educational to focus on what is going to happen based on how we relate supply and demand to price, rather than spending time trying to make price movements fit in to these multi-stepped patterns. Given the choice, why do people get so focused on the patterns.

4358

Perhaps this may be due to our inner desire to have something finite - almost concrete - that we can focus our attention on to base our decisions. Monitoring pure price action can prove to be rather difficult for some since it demands confidence in his/her own analysis to take a leap of faith and make trades based on their OWN findings; as this can be a very subjective process its effectiveness may be questioned by the trader as there isn’t a signal or pattern telling you to “go long” or “go short”. It’s based on your interpretation of seemingly abstract S&R levels, trends, and candlesticks along with whatever else may be in your price action trading arsenal.
If you take an indicator - let’s say MACD divergence - for example, you’re basing your decisions off something that’s not entirely subjective. It gives you an indication that, in a way, tells you what to do and when: “When the two lines cross, DO THIS” or in the case of Stochastic, for instance: “Once it reaches >80, sell because it’s overbought”.
When these indicators give us a wrong signal, we can immediately attribute our failure to bad signals and not our analysis thus deflecting accountability. I’m completely generalizing when I say this, but our innate nature has a tendency to resist attributing failure to ourselves. If we can find a fault elsewhere, and lend credence to IT being the source of our failure, we’d much prefer that. Similarly for patterns. One might think, “Hey, that’s easy. I’ll just identify an AB = CD pattern and once found I’ll execute my trade. This is easy - no monitoring price action, no studying top down analysis, of course I can do this!” Again, when it doesn’t work out as planned, the trader may rationalize: “It’s not my fault, I did what I was supposed to do… It’s not me who failed here”. I would like to point out that I’m not by any means pointing fingers at pattern traders or those who rely heavily on indicators… There are many traders who trade using these tools highly successfully. However, there is an appeal for new traders to get sucked into relying solely on signals telling them what to do or what not to without taking into account the bigger picture and putting in the work to make them consistently successful traders.

Anyway, that’s just my take on the issue since I traded this way at the very beginning. Prior to finding this thread, my charts looked ridiculous. I had indicators completely masking the price action, and got to a point where I wasn’t even paying attention to entry/exit prices but only to signals prompting me to get into a trade and get out of a trade. Now, thanks to this thread, I’ve diverted my attention to studying price action and ditched the colorful charts. If not for anything else, it’s a lot more sobering to my eyes :slight_smile:

4359

What a time to ignore Weekly pivots.

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Wally

4360

hehe, thats some accurate price action right there. Hands up who woulda let profits run that far

4361

Hint: on EU turn on EST daily pivot R3 level and what happened almost to the pip. Open the indicator and select True for R3.

4363

We’ve gone way off topic of this thread lets reel it back in. The main pointers are s/r analysis for mostly naked trading which is very easy to trade. Do your analysis and don’t get hooked on indicators. You know what indicators are great for? Telling you what HAPPENED. They rely on past data to tell you what happened, it isn’t very useful for current trade environments as today should have shown you.

I traded my usual approach today and made over 100 pips in a few trades. I left over 248 pips on the table from where I exited for various reasons and missed the 45 OTE short on GU at 11 am since I wasn’t at my computer. However, the only indicator I had on my chart was the pivot drawing indicator because it’s quick and easy. The rest of the time price reacted at the traditional s/r/institutional areas. I also keep the ADR on but that was blown out of the water on EU and very useful on the GU–to the pip there. Otherwise it is very simply s/r trading on the 1hr watching what price is doing and where price is likely going. Don’t get bogged down with new ideals until you have mastered your current techniques. KISS

If you want to see the quality of what Nison is selling here’s his 14 trade principles, publicly available via our helpful friends at google: 14 principles

4364

So my feed gives Daily R3 at 1.4236, Weekly R3 came in at 1.4245, and then of course the institutional 50. Previous week’s R2 came in at 1.4253.

4365

Ali, sorry to be so long in replying to your question — I got involved in something else.

Regarding your question, I haven’t done any comparison calculations.

This experiment of mine came about because it [I][B]seems[/B][/I] to me that a linear regression line [I][B]should be[/B][/I] more accurate than a moving average, in representing the [I][B]Average[/B][/I] Daily Range (ADR).

I don’t expect to run any sort of rigorous back-testing or forward-testing on this idea (I especially hate back-testing). For now, I’m just going to watch the numbers this generates, and then decide whether it needs to be analyzed more thoroughly.

Time will tell whether this approach is viable, whether it needs to be tweaked, or whether it needs to be scrapped.
In the meantime, nobody (with the possible exception of me) should make trading decisions based on it.

Maybe, in a couple of weeks, we should compare notes again — your ADR signals compared to mine.

4366

All of Europe and the U.K. will return to Standard Time on Sunday, October 30. Time zones will change as follows:

• Eastern European Summer Time (EEST = GMT+3) will change to Eastern European Time (EET = GMT+2)

• Central European Summer Time (CEST = GMT+2) will change to Central European Time (CET = GMT+1)

• Western European Summer Time (WEST = GMT+1) will change to Western European Time (WET = GMT)

• British Summer Time (BST = GMT+1) will change to Greenwich Mean Time (GMT)

For one week, beginning on Sunday, October 30 —

• traders in Europe and the U.K. will have to adjust to new times for the Asian Session Kill Zone,
and the New York Open Kill Zone, and

• traders outside Europe and the U.K. will have to adjust to new times for the London Open Kill Zone,
and the London Close Kill Zone.

Using New York time (EDT = GMT-4) as our reference time zone, the Kill Zones currently are:

• Asian Session Kill Zone: 6pm-10pm EDT (2200–0200 GMT)

• London Open Kill Zone: 2am-4am EDT (0600-0800 GMT)

• New York Open Kill Zone: 7am-9am EDT (1100-1300 GMT)

• London Close Kill Zone: 11am-1pm EDT (1500-1700 GMT)

[B]Beginning on October 30, and continuing for one week, the Kill Zones will be:

• Asian Session Kill Zone: 6pm-10pm EDT (2200–0200 GMT)

• London Open Kill Zone: 3am-5am EDT (0700-0900 GMT)

• New York Open Kill Zone: 7am-9am EDT (1100-1300 GMT)

• London Close Kill Zone: 12pm-2pm EDT (1600-1800 GMT)[/B]

You can determine (or verify) your own time zone here — 301 Moved Permanently

The Kill Zones will change again in one week, on Sunday, November 6. That will be the last change, until March 2012.

4367

Yep, weekly pivots are ignored quite often but daily R3 extensions are usually respected unless a major news event just drives the currency. You might have ignored the weekly but would you have had more confidence with that r3?

Now something I had on my charts as well. A fib drawn from the base to the low point. PA reacted at the 72% pull back and are barely missed with the 79% deep pull back. Is this technically important? Maybe, but then I add the fib from the price action of the high on 5/4 to the range low on 7/12 and where did the EU drop to. the 1.618 extension line/3.150 institution line. I’m not so sure this is coincidence, especially those large traders who like Gartley patterns and trade off the daily.

4368

I respectfully disagree about being off topic for the thread. The topic of the thread (I thought) is learning, as it relates to the new forex trader, and a general sharing of ideas. Although a bit over the top with my sarcasm (the hour was advertised as a learning webinar, and it was basically a commercial, given by someone I regard as prominent in the field), my comment was aimed at giving my feedback regarding a resource I checked out. I appreciate the link to the principles (should have googled them myself) and as suspected, they seem to be common sense tips, and not super insightful. I did delete my original post out of respect for your opinion, but I do maintain that giving feedback about learning resources within the world of forex is a good thing.

4369

Hey Babypipsters! :wink:

Just a reminder the much anticipated ICT London Close Tactic video will be released on Monday night … Happy Halloween you Forex Monsters. :stuck_out_tongue:

For those interested… The ICT London Open Tactic video will be released on November 14.

ICT has his Christmas sack full of goodies for you as well. We will be closing this thread December 31, 2011. However, not to give you a Blue Christmas… No way… Babypipmania will be rolling out the exclusive “ICT 25 Days of Christmas”!

You read that right… Beginning December 1st… Santa’s pulling a new toy out of his sack for your Trader Christmas tree! We will conclude with my Definitive Guide To Megatrades on Christmas day. Right in time for that moment when all the gifts have been opened and you just wished you had … One more. :wink:

Now don’t you just wonder what I have in store for Babypips in 2012?

Stay tuned folks… :57:

4370

…actually foaming at the mouth…

4371

BINGO -
There was a comment by ICT somewhere - be it video or response in this thread - that partly sums up what you’re saying.
Sorry if I misquote, but somthing like
"when the higher timeframes agree - all your bull flags, all your patterns etc. . simply work."
So as I take it- when you know where the market is at - you can expect things to work your way - -if you don’t , and you are on the ‘wrong’ side -then all those patterns, and indicators are very suspect - -they may still work once in a while - but don’t count on it.

4372

I was hoping someone would figure this out. Great write up and just copied now to save in my traders toolbox.

4373

I hate it and love it when you do this all at the same time. You defenitly know how to keep me from sleeping at night.

I fill like a little kid all over again. Get out the calendar and start marking off days for the count down.

ME — MOM IS IT TIME FOR ICT TO POST HIS MATERIAL YET!!!
MOM — NOPE NOT YET SON!!!

30 minutes later…

ME — MOM IS IT TIME FOR ICT TO POST HIS MATERIAL YET!!!
MOM — NOPE NOT YET SON!!!
ME — DAMN IT I CAN’T WAIT ANY LONGER, WHERE ARE THOSE PRESENTS!!!

Sorry just flashed back to christmas when I was 8 years old.

Now back to trading.