My new chaos findings implemented in forex trading

forex live trades, setups, charts

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Paul&Paul
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GBPUSD

Postby Paul&Paul » Thu Mar 03, 2011 6:48 pm

GBPUSD is retracing its recent gains.
The new chart enclosed shows another aspect of chaos dynamic developments.
The base of the blue triangle rests on UPO@1.6255. We start from the left vertice and proceed clockwise. Up to 4.699 and back again to the base. This is called a loop, or a return to a UPO. Average state of the system as well as its second order statistical characteristics can be calculated by UPOs with very high accuracy. UPOs form a skeleton of the system attractor and are important in understanding its dynamics. The predictability of the system trajectory is controlled by the behavior of nearby orbits. There are shorter-term UPOs and longer-term UPOs. There are UPOs-attractors and UPOs-repellers. Real markets are a mixture of attractors and repellers. Position trading bases on triggers. Contrarian trading bases on attractors. The key problem is not to exaggerate with contrarian trading because an active trigger may cause an exponential runaway from a UPO-repeller and cripple the account in a substantial way. We can distiguish active triggers from non-active triggers by observing reaction to borders of chaos calculated with multipliers like F=4.669. Remember that we deal with projections from higher dimensions of the real thing onto a 2-D plane. It is not important how it looks like in dimension 4 for example, yet it is important how it behaves if it is looked at from one angle. The behavior is more importatnt than the looks. We can study the process from the point of view of different time scales. We can study M30 charts as well as H1 charts, or we can study M3 charts. The principles will be exactly the same. Fractals can evolve in time linearly and exponentially. A linear evolution resembles stamping the same pattern over and over again. A non-linear evolution resembles inflating a fractal baloon.
The complexity comes from dimension 4. Straight lines can become curves, flat areas can become spherical. The least complicated things to watch are the borders, common borders dividing the object into semi-similar parts.
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Paul&Paul
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GBPUSD struggles to stay above 1.6232

Postby Paul&Paul » Fri Mar 04, 2011 5:24 pm

GBPUSD struggles to stay above 1.6232. There are two borders there, each 4.669 of two seperate triggers.
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Paul&Paul
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GBPJPY

Postby Paul&Paul » Fri Mar 04, 2011 5:48 pm

Some pressure upside is evident to break through 134.10 and 134.33 where two targets 134.37 and 134.60 are waiting (both 4.669).
The nearest target from downside is 132.51.


The said targets proved mild ones as GBPJPY soared to over 115.00 but retreated from that high later during the session.
Very important was 134.96 obtained from a much earlier trigger (Feb,22). Now from the topside we have 134.96 and 135.23. The latter is our next target for longs.

What comes out from the bottom side will be presented after a while.
Attachments
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Chaos on DE30

Postby Paul&Paul » Sat Mar 05, 2011 8:49 am

xxx
Last edited by Paul&Paul on Sat Mar 05, 2011 8:56 am, edited 1 time in total.

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Chaos on DE30

Postby Paul&Paul » Sat Mar 05, 2011 8:49 am

The moment retail (small) traders become true market participants is the date of a true market revolution and the end of banks enjoying enourmous bonuses and profits.
"The concept of being too important to fail should have no place in a market economy." said Mervyn King, Bank of England governor.
Mr King said over the past two decades too many people in financial services had thought "if it's possible to make money out of gullible or unsuspecting customers, that's perfectly acceptable".
Today it is seen perfectly well that retail trade faces tough and discriminatory regulations preventing it from expanding in a natural and healthy way just as other sectors of the economy do.
Mervyn King appears to have thrown a verbal grenade into the problem of banks. I am throwing mine.
We need a step towards ending the trend of legitimizing small traders disempowerment in the name of system's stability.
Last edited by Paul&Paul on Sat Mar 05, 2011 10:08 am, edited 2 times in total.

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Chaos on DE30

Postby Paul&Paul » Sat Mar 05, 2011 8:53 am

Chaos on DE30.
The chart below is the index of DE30 (or "Germany 30"). Well, you got it, you name it. I needed to attach two charts for better clarity of the recent developments.
There can be no mistake about it. I am showing you determinism of a chaotic system present on a stock exchange. It is not the interbank system but a stock exchange system.

Any similarities between the interbank and the Frankfurt software systems are unsubstantiated. Yet, the behavior of the two environments is not similar, it is exactly the same as far as the principles are concerned. We deal with a chaotic system here as well. That highlights the significance of my findings which are universal for many types of non-linear dynamical systems.
Attachments
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A bit of statistics

Postby Paul&Paul » Sat Mar 05, 2011 1:52 pm

Currency: GBPCAD
Period: October 13-29, 2010
Signals traded: all triggers used as they occurred, target 4.669
Closed trades: +3663 pips
Number of triggers: 62.
Number of trades: 62.
No stop loss applied.
Opened trades at the end of the period: 18 (9 longs, 9 shorts)
Floating loss: -536 pips
Profit to floating loss ratio: 6.8:1.
Type of the market: mildly trending.
Performance: exceptional.

Some other pairs yielded 2.5:1 (EURUSD), 1.55:1(AUDJPY), 3.05:1(EURAUD).
Performance strongly correlerated with the strength of the trend. Note that only 4.669 targets were taken.

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Let us see CADCHF

Postby Paul&Paul » Sat Mar 05, 2011 6:34 pm

CADCHF is on the agenda now. Never mind the spread (8pips). For position trading spread does not matter at all. I used to get 10 pips on majors. The reason I chose CADCHF is its broader picture on H4 charts. Not a very strong downtrend. The reasons for general CHF strength are well known.
For almost six months it has been traded in a range of 600 pips.

Currently CADCHF is capped by a bundle of orbits @ 0.9597/9605/9612/9617/9622/9624. What they are needed for, what they defend, we have to go back a little into the near history, namely February 18-21. The blue triangle marks a loop, a typical return to a UPO@0.9650. Soon the UPO-attractor turned into a UPO-repeller. Professionals were selling CADCHF all the way from the low 0.9550 till 0.9650. Yes, they were selling in an uptrend. Then some heavier selling took place in the region marked by the ellipse. And basically the bundle of the said orbits defends those short positions. So the battle is to crash them. It becomes obvious that once CADCHF breaks 0.9622/24 it is not going to rest but it is going all over 9650. Sooner or later this will happen. It is already determined by the system.
There is not enough energy in the latest triggers to lift the prices through 9624. I see it needs some fresh engagement and it may develop when it dips to 9445 and 9422.
The buyers have not been sitting idle. Yet we see that they do not have much to protect their positions. Once 9490 is taken CADCHF is going to dive some 70 pips. (current close @9496)
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AUDCHF

Postby Paul&Paul » Sat Mar 05, 2011 7:44 pm

Clearly rejected 9461 set the mood to visit 9318 and 9316. The last trigger was up with 3.5699=9461 and 4.669=9486.
The numbers do not appeal instantly unless you see the chart.
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EURUSD

Postby Paul&Paul » Sat Mar 05, 2011 9:14 pm

EURUSD accomplished 4.669 of the huge trigger up which is 1.4005 or 443 pips.
The last movement from 1.3870 is a knee-jerk reaction to Trichet's statement last Thursday that ECB is ready to rise rates as early as next month. Before that EURUSD had already signalled readiness for a retracement.
I will gradually proceed with adding new things on the chart.
The first conclusion as for now is that EURUSD should decline from 1.4005 as it is an important border in a chaotic system. We are leaving that trigger for the time being and analyze the behavior based on a projection of a next trigger (47 pips). Suddenly, a hidden order unveils in front of our eyes.
4.669 of that next trigger is at 1.3829 and that's what we generally look for - we want to know what the market did at some levels. 1.3829 was actually the first place on the way up where some selling showed but not very serious. It was more a slide of prices than real professional selling. On the slide to 1.3723 professionals were really buying EURUSD. The public was selling, the profi were buying. They were serious about that all the way down to 1.3723. Not just one trade at 1.3723 risking dealers miss the opportunity. To make shure they were in, their orders were executed earlier at prices which might have not excited the public at all. I marked that area in blue.
I conclude from that fragment of the market that EURUSD is aiming at 1.4277 which is 14.208 of the trigger and also almost exactly the top from November 4 of last year. The chaotic system pinpoints exactly the said target and the true intentions of you name who. The system has got enough energy to accomplish the task. But as I said earlier, do not expect it can go in a straight line. In order to gather steam EURUSD needs to trap sellers in an ambush and later wave goodbye.
You may wonder where EURUSD might go once 1.4277 is taken. That's easy.
It is going to break to 1.4284, retrace and finally go to 1.4388. We always need to refer to the past. It took quite a lot shifting the chart back to January of 2010.
Some targets are secondary, some even tertiary but there can be no mistake saying that 1.4388 is a primary goal. What do we see from the market as on January 18 & January 19?
Well, first of all we now know that 1.4277 is not like any other level. It was the top from November 7 and it was a region of massive selling in January of 2010.
1.4388 was also a region of massive selling one day earlier. Currently the market showed its cards on the table. You better evacuate from those positions or you may regret waiting for too long. Which means that the forces interested in crashing those shorts have got shorting guys with them, not against them. In order to close shorts they have to buy EURUSD and buying is going to be dearer and dearer to them.
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