EURUSD has got one equilibrium line @ 1.4231 which shows a broader picture bearish while below.
On the other hand we have another equilibrium line @ 1.4107 from a smaller picture which shows bullishness while above.
This is a well known fact that how we see the market depends on how we relate the latest happenings.
Generally we do not go back very far into the past. It would not be very wrong provided there was no inner built memory.
My new chaos findings implemented in forex trading
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EURUSD aided with 3 ZZ semafor and triggers on M168 chart
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CHFPLN
CHFPLN plummeted 14.208 of a trigger down.
Interesting that the previous 4.669=3.5010 border is clearly seen where the massive selloff began. It was the very beginning of the European session and it coincides with EURCHF going swiftly up from recent lows.
Interesting that the previous 4.669=3.5010 border is clearly seen where the massive selloff began. It was the very beginning of the European session and it coincides with EURCHF going swiftly up from recent lows.
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Fractal expansions are rife everyday
Fractal expansions are rife everyday.
Triggers form and expand according to a well described universal rule. They are some sort of energy which does not allow a pair of currencies to rest in an equilibrium state. Markets are in inequlibria most of the time. In a given state of the market there will always be some active trigger.
Let us assume that under observation is some number of global market segments, for example EURUSD, GBPUSD, GBPJPY, EURJPY, EURGBP, EURCAD, USDCAD. In this example there are seven pairs.
The problem is formulated in the following way.
Suppose there exists a way to detect latest triggers on each pair with no significant delay, almost at the same time in the given and the same time frame.
What would be the difference between observing and trading just one currency pair and observing and trading seven currency pairs. Can we expect different returns and which way is better?
Most textbooks on forex, if not all, suggest limiting traded currency pairs possibly to just one. For various reasons, perhaps the most important is that then we are able to "know" what we trade better.
I challenge this stance as knowing something better hardly translates into better trading results.
Let us view the market as a living entity and each segment as its limb. It seems that watching several hands moving tells more than seeing just one. In fact, there should be a significant difference between trading
one and only one EURUSD and seven currency pairs, provided the same rules are consistently applied to all of them.
From the point of mathematics our traded sample gains more dimensions. I repeatedly like referring to a model of a bicycle ride which requires a space of at least 10 dimensions. If we forget about one, we end up with a severe accident. Well then, I claim that we can gain a tremendous edge by trading many currency pairs at the same time provided the same set of rules is uniformly applied.
Since the energy in the system constantly pushes the prices upwards and/or downwards a bigger traded sample simply better reflects the movements of the global market. In a way, our trading results pertain to some undefined (yet existing) global vector of energy. As markets must evolve in a fractal way, this compound energy from its single segments must produce, at least temporarily, a profit in balance for all those open positions. This idea resembles arbitrage but it is not. It needs to be understood that arbitrage is the practice of taking advantage of a price difference between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices.
In chaos, I claim we can capitalize upon the balance of energy of several market segments which is always a nontrivial multidimensional vector. My observations and practical results support this.
Triggers form and expand according to a well described universal rule. They are some sort of energy which does not allow a pair of currencies to rest in an equilibrium state. Markets are in inequlibria most of the time. In a given state of the market there will always be some active trigger.
Let us assume that under observation is some number of global market segments, for example EURUSD, GBPUSD, GBPJPY, EURJPY, EURGBP, EURCAD, USDCAD. In this example there are seven pairs.
The problem is formulated in the following way.
Suppose there exists a way to detect latest triggers on each pair with no significant delay, almost at the same time in the given and the same time frame.
What would be the difference between observing and trading just one currency pair and observing and trading seven currency pairs. Can we expect different returns and which way is better?
Most textbooks on forex, if not all, suggest limiting traded currency pairs possibly to just one. For various reasons, perhaps the most important is that then we are able to "know" what we trade better.
I challenge this stance as knowing something better hardly translates into better trading results.
Let us view the market as a living entity and each segment as its limb. It seems that watching several hands moving tells more than seeing just one. In fact, there should be a significant difference between trading
one and only one EURUSD and seven currency pairs, provided the same rules are consistently applied to all of them.
From the point of mathematics our traded sample gains more dimensions. I repeatedly like referring to a model of a bicycle ride which requires a space of at least 10 dimensions. If we forget about one, we end up with a severe accident. Well then, I claim that we can gain a tremendous edge by trading many currency pairs at the same time provided the same set of rules is uniformly applied.
Since the energy in the system constantly pushes the prices upwards and/or downwards a bigger traded sample simply better reflects the movements of the global market. In a way, our trading results pertain to some undefined (yet existing) global vector of energy. As markets must evolve in a fractal way, this compound energy from its single segments must produce, at least temporarily, a profit in balance for all those open positions. This idea resembles arbitrage but it is not. It needs to be understood that arbitrage is the practice of taking advantage of a price difference between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices.
In chaos, I claim we can capitalize upon the balance of energy of several market segments which is always a nontrivial multidimensional vector. My observations and practical results support this.
Category theory
I believe that various concepts presented here are bound by the category theory.
Category theory is an area of study in mathematics that examines in an abstract way the properties of particular mathematical concepts, by formalising them as collections of objects and arrows (also called morphisms), where these collections satisfy certain basic conditions.
Stanisław Ulam, and some writing on his behalf, have claimed that related ideas were current in the late 1930s in Poland. Eilenberg was Polish, and studied mathematics in Poland in the 1930s.
In 1942?45, Samuel Eilenberg and Saunders Mac Lane introduced categories, functors, and natural transformations as part of their work in topology, especially algebraic topology.
Category theory is also, in some sense, a continuation of the work of Emmy Noether who was described by David Hilbert, Albert Einstein and others as the most important woman in the history of mathematics.
Certainly more names can be added here of whom I would specifically refer to John Baez.
What really needs to be remembered here talking about the category theory is the contribution of famous Polish mathematicians who laid the foundations for a unique evolution of some of those ideas until today.
I have the greatest contempt for optimism of dear readers, however, the inspirational role of this site needs to be highly appraised.
There is no better way to study Nature, and markets are Nature, than to study it in the right way.
Category theory is an area of study in mathematics that examines in an abstract way the properties of particular mathematical concepts, by formalising them as collections of objects and arrows (also called morphisms), where these collections satisfy certain basic conditions.
Stanisław Ulam, and some writing on his behalf, have claimed that related ideas were current in the late 1930s in Poland. Eilenberg was Polish, and studied mathematics in Poland in the 1930s.
In 1942?45, Samuel Eilenberg and Saunders Mac Lane introduced categories, functors, and natural transformations as part of their work in topology, especially algebraic topology.
Category theory is also, in some sense, a continuation of the work of Emmy Noether who was described by David Hilbert, Albert Einstein and others as the most important woman in the history of mathematics.
Certainly more names can be added here of whom I would specifically refer to John Baez.
What really needs to be remembered here talking about the category theory is the contribution of famous Polish mathematicians who laid the foundations for a unique evolution of some of those ideas until today.
I have the greatest contempt for optimism of dear readers, however, the inspirational role of this site needs to be highly appraised.
There is no better way to study Nature, and markets are Nature, than to study it in the right way.
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Thank you for your support.
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Re: Fractal expansions are rife everyday
Paul&Paul wrote:Fractal expansions are rife everyday.
Triggers form and expand according to a well described universal rule. They are some sort of energy which does not allow a pair of currencies to rest in an equilibrium state. Markets are in inequlibria most of the time. In a given state of the market there will always be some active trigger.
Let us assume that under observation is some number of global market segments, for example EURUSD, GBPUSD, GBPJPY, EURJPY, EURGBP, EURCAD, USDCAD. In this example there are seven pairs.
The problem is formulated in the following way.
Suppose there exists a way to detect latest triggers on each pair with no significant delay, almost at the same time in the given and the same time frame.
What would be the difference between observing and trading just one currency pair and observing and trading seven currency pairs. Can we expect different returns and which way is better?
Most textbooks on forex, if not all, suggest limiting traded currency pairs possibly to just one. For various reasons, perhaps the most important is that then we are able to "know" what we trade better.
I challenge this stance as knowing something better hardly translates into better trading results.
Let us view the market as a living entity and each segment as its limb. It seems that watching several hands moving tells more than seeing just one. In fact, there should be a significant difference between trading
one and only one EURUSD and seven currency pairs, provided the same rules are consistently applied to all of them.
From the point of mathematics our traded sample gains more dimensions. I repeatedly like referring to a model of a bicycle ride which requires a space of at least 10 dimensions. If we forget about one, we end up with a severe accident. Well then, I claim that we can gain a tremendous edge by trading many currency pairs at the same time provided the same set of rules is uniformly applied.
Since the energy in the system constantly pushes the prices upwards and/or downwards a bigger traded sample simply better reflects the movements of the global market. In a way, our trading results pertain to some undefined (yet existing) global vector of energy. As markets must evolve in a fractal way, this compound energy from its single segments must produce, at least temporarily, a profit in balance for all those open positions. This idea resembles arbitrage but it is not. It needs to be understood that arbitrage is the practice of taking advantage of a price difference between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices.
In chaos, I claim we can capitalize upon the balance of energy of several market segments which is always a nontrivial multidimensional vector. My observations and practical results support this.
I agree with you on this one. This is why I think this way : say when I am trading EURUSD. I am not trading EURUSD! I am trading EURxxx and USDxxx. I want to know what the entire market is doing, rather than just the pair itself.
Re: Fractal expansions are rife everyday
Relativity wrote the essence of it.
The question is how can we know what the entire market is doing. Do we need to know "everything" or does it suffice to know its some basic matrix. It is a truism that we cannot follow the evolution of a system by analyzing too many details of it. There needs to be some sort of function or functor which gives some sort of generality. And most importantly, for studying this generality we need exactly the same set of rules applied for some details selected. It is a well known fact that traders/analysts apply different tools to different currency pairs because they seemingly better "fit". This is wrong. I mean this is right from then point of view of a detail like EURCAD, but fundamentally wrong for generality of EUR... and CAD....
What happens then, is that where a broader picture is being tried to be painted with a set of different colours, there cannot be harmony and cohesion at all. We are constantly misled and the final result being absolutely sure that some pairs simply behave "well", or "correct", while some others exhibit serious "flaws" when examined for the same time brackets.
It is a horror seeing the same indicator set to default on one pair and to custom on another. Or worse, using several different custom settings of the same indicator on one chart and averaging them.
This issue does not require any elaboration. Simply said, what's mathematically wrong (wrong in an abstract way), cannot be right in reality.
The question is how can we know what the entire market is doing. Do we need to know "everything" or does it suffice to know its some basic matrix. It is a truism that we cannot follow the evolution of a system by analyzing too many details of it. There needs to be some sort of function or functor which gives some sort of generality. And most importantly, for studying this generality we need exactly the same set of rules applied for some details selected. It is a well known fact that traders/analysts apply different tools to different currency pairs because they seemingly better "fit". This is wrong. I mean this is right from then point of view of a detail like EURCAD, but fundamentally wrong for generality of EUR... and CAD....
What happens then, is that where a broader picture is being tried to be painted with a set of different colours, there cannot be harmony and cohesion at all. We are constantly misled and the final result being absolutely sure that some pairs simply behave "well", or "correct", while some others exhibit serious "flaws" when examined for the same time brackets.
It is a horror seeing the same indicator set to default on one pair and to custom on another. Or worse, using several different custom settings of the same indicator on one chart and averaging them.
This issue does not require any elaboration. Simply said, what's mathematically wrong (wrong in an abstract way), cannot be right in reality.

 rank: 150+ posts
 Posts: 364
 Joined: Mon Nov 15, 2010 4:19 pm
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Re: Fractal expansions are rife everyday
Paul&Paul wrote:Relativity wrote the essence of it.
The question is how can we know what the entire market is doing. Do we need to know "everything" or does it suffice to know its some basic matrix. It is a truism that we cannot follow the evolution of a system by analyzing too many details of it. There needs to be some sort of function or functor which gives some sort of generality. And most importantly, for studying this generality we need exactly the same set of rules applied for some details selected. It is a well known fact that traders/analysts apply different tools to different currency pairs because they seemingly better "fit". This is wrong. I mean this is right from then point of view of a detail like EURCAD, but fundamentally wrong for generality of EUR... and CAD....
What happens then, is that where a broader picture is being tried to be painted with a set of different colours, there cannot be harmony and cohesion at all. We are constantly misled and the final result being absolutely sure that some pairs simply behave "well", or "correct", while some others exhibit serious "flaws" when examined for the same time brackets.
It is a horror seeing the same indicator set to default on one pair and to custom on another. Or worse, using several different custom settings of the same indicator on one chart and averaging them.
This issue does not require any elaboration. Simply said, what's mathematically wrong (wrong in an abstract way), cannot be right in reality.
This is the best way I know so far.
Allied Currencies
The concept of trading a portfolio energy
For a moment forget that you can trade only one pair of currencies.
How many pairs can be traded at all? 28, 30 or more? More.
How do you select the one that you actually trade?
What makes you sure that your choice is right?
What makes you sure that you will make a profit?
What makes you shure that you will know what to do when things go wrong?
You might have made a couple of systemic mistakes before you clicked OK.
Now think about reducing the number of possible mistakes.
Number one. Trade other pairs at the same time. You have just (almost) eliminated the risk of a wrong choice.
Number two. Use exactly the same tools for every chart. Apply exactly the same settings for your indicator(s). You have just eliminated the mistake of taking a wrong binocles on your nose.
Number three. Open the first trade when the signal is there from your tools.
Number four. Do not average.
Number five. Open a second trade on another currency pair when the signal is there.
Number six. Open subsequent trades on the remaining currency pairs you picked for trading but only if the signals are there.
Number seven. You have got several positions opened with a floating profit/loss (I would argue that with a loss).
Number eight. Observe the floating balance on all open positions. Disregard what is happening with individual profits/losses. Your only interest is the balance.
Number nine. Observe the moments when your situation worsens.
Number ten. Observe the moments when you are breakeven.
Number eleven. Observe the beginning of a rapid change of your balance from loss to profit.
Number twelve. Take profit by closing all your open positions.
Number thirteen. If you are not nearing any profit on your balance at all within 12 sessions, then the rules generating signals are catastrophically wrong. Your system needs to be revised. You have lost only a couple of trades though.
Number fourteen. When you are nearing a profit region you will feel a strange sensation that the changes in the balance on all opened positions are dynamically very intriguing. So much so that you may wish you were analysing just this new variable, instead of gazing at normal candle charts.
Number fifteen. When the set is right you hear the pulse of the market, you see its main artery pulsing. The pulsation is unique, not random. You actually see a transform of energy. What might have wronged you with a single pair of currencies (because you picked a one with constant loss throughout the session), should be alright with a portfolio of different orders. Never mind that some are long and some are short. There may be no logical explanation. Disengage reasoning, just do it automatically. On balance there should be a moment of success. Sometimes not a moment but an hour, sometimes more, or even much much more. If that moment never comes within 2448 hours, your system is entirely wrong.
Number sixteen. Nothing can be said about stoplosses.
Number seventeen. Feel it. Feel the difference.
Number eighteen. You are watching the "big picture" not seeing it.
Number nineteen. You are trading category theory.
Number twenty. Because you are trading category theory, the most obvious change if sth goes wrong is if you use the duality. This means rehearsing with reversed orders (buys replaced by sells, sells replaced by buys for all pairs used in your next experiment).
I will come up with an example a bit later.
How many pairs can be traded at all? 28, 30 or more? More.
How do you select the one that you actually trade?
What makes you sure that your choice is right?
What makes you sure that you will make a profit?
What makes you shure that you will know what to do when things go wrong?
You might have made a couple of systemic mistakes before you clicked OK.
Now think about reducing the number of possible mistakes.
Number one. Trade other pairs at the same time. You have just (almost) eliminated the risk of a wrong choice.
Number two. Use exactly the same tools for every chart. Apply exactly the same settings for your indicator(s). You have just eliminated the mistake of taking a wrong binocles on your nose.
Number three. Open the first trade when the signal is there from your tools.
Number four. Do not average.
Number five. Open a second trade on another currency pair when the signal is there.
Number six. Open subsequent trades on the remaining currency pairs you picked for trading but only if the signals are there.
Number seven. You have got several positions opened with a floating profit/loss (I would argue that with a loss).
Number eight. Observe the floating balance on all open positions. Disregard what is happening with individual profits/losses. Your only interest is the balance.
Number nine. Observe the moments when your situation worsens.
Number ten. Observe the moments when you are breakeven.
Number eleven. Observe the beginning of a rapid change of your balance from loss to profit.
Number twelve. Take profit by closing all your open positions.
Number thirteen. If you are not nearing any profit on your balance at all within 12 sessions, then the rules generating signals are catastrophically wrong. Your system needs to be revised. You have lost only a couple of trades though.
Number fourteen. When you are nearing a profit region you will feel a strange sensation that the changes in the balance on all opened positions are dynamically very intriguing. So much so that you may wish you were analysing just this new variable, instead of gazing at normal candle charts.
Number fifteen. When the set is right you hear the pulse of the market, you see its main artery pulsing. The pulsation is unique, not random. You actually see a transform of energy. What might have wronged you with a single pair of currencies (because you picked a one with constant loss throughout the session), should be alright with a portfolio of different orders. Never mind that some are long and some are short. There may be no logical explanation. Disengage reasoning, just do it automatically. On balance there should be a moment of success. Sometimes not a moment but an hour, sometimes more, or even much much more. If that moment never comes within 2448 hours, your system is entirely wrong.
Number sixteen. Nothing can be said about stoplosses.
Number seventeen. Feel it. Feel the difference.
Number eighteen. You are watching the "big picture" not seeing it.
Number nineteen. You are trading category theory.
Number twenty. Because you are trading category theory, the most obvious change if sth goes wrong is if you use the duality. This means rehearsing with reversed orders (buys replaced by sells, sells replaced by buys for all pairs used in your next experiment).
I will come up with an example a bit later.
Category
We are roughly symmetrical, our face, two hands, two legs... yet there is biological asymmetry and handedness. The asymmetry is encoded in the genes. The brain is asymmetrical. Natural systems are well known for spontaneous symmetry breaking. Small energy level differences can make a big difference. Market changes seldom exhibit symmetry.
A category (C) consists of two collections, one whose elements are the objects of C and the arrows (or morphisms or maps) of C. To each arrow is assigned a pair of objects, called the source and the target of the arrow. It is natural to define a morphism of categories to be a map which takes objects to objects, arrows to arrows, and preserves source, target, identities and composition.
Duality: for every categorical construct, there is a dual, formed by reversing
all the morphisms.
These few lines of the category theory strikingly resemble real market structures. I will refer to the findings of the chaos theory where I use such concepts like triggers (sources), fractal expansions (targets), inner built memory (preserved sources, targets, identities and composition).
And finally I point to the fundamental fact, that duality reigns in the financial markets the most. We can amazingly reverse all the morphisms for a categorical construct by changing buys to sells and sells to buys. This looks like riding a bicycle knowing nothing about the mathematical model of the ride. Still, a lot of people can do it perfectly well. They manage one of the most difficult dynamical tasks well because they keep to the rules of category theory.
Do we keep to them while trading?
Just imagine how you could spoil your bicycle ride, think of the worst possible scenarios, the most weird ideas on the road, the most stupid things, the baddest things your megamind could do to your bike and the ride, the Montiest Monty Python clip. Sounds ridiculous? Well, I am afraid that your imagination prompts you even worse things than throwing away the handle bar and speeding downhill during a nap.
The problem is that even a trading licence in the present times would be a licence to kill, I am afraid.
I have the greatest contempt for optimism. Free TA tools loom like a galore of poisons and tranquilizers plus hundreds of different brands of aspirin prescribed for a widest range of diseases. Traders love coctails, though, unnerved. A little bit of this and a little bit of that, shake well and chill. Mathematicians used to treat practical experiments with disdain and contempt. That is one of the reasons they were of little use. They are?
If you expect to win by the skin of false teeth... you are probably in Hollywood.
A category (C) consists of two collections, one whose elements are the objects of C and the arrows (or morphisms or maps) of C. To each arrow is assigned a pair of objects, called the source and the target of the arrow. It is natural to define a morphism of categories to be a map which takes objects to objects, arrows to arrows, and preserves source, target, identities and composition.
Duality: for every categorical construct, there is a dual, formed by reversing
all the morphisms.
These few lines of the category theory strikingly resemble real market structures. I will refer to the findings of the chaos theory where I use such concepts like triggers (sources), fractal expansions (targets), inner built memory (preserved sources, targets, identities and composition).
And finally I point to the fundamental fact, that duality reigns in the financial markets the most. We can amazingly reverse all the morphisms for a categorical construct by changing buys to sells and sells to buys. This looks like riding a bicycle knowing nothing about the mathematical model of the ride. Still, a lot of people can do it perfectly well. They manage one of the most difficult dynamical tasks well because they keep to the rules of category theory.
Do we keep to them while trading?
Just imagine how you could spoil your bicycle ride, think of the worst possible scenarios, the most weird ideas on the road, the most stupid things, the baddest things your megamind could do to your bike and the ride, the Montiest Monty Python clip. Sounds ridiculous? Well, I am afraid that your imagination prompts you even worse things than throwing away the handle bar and speeding downhill during a nap.
The problem is that even a trading licence in the present times would be a licence to kill, I am afraid.
I have the greatest contempt for optimism. Free TA tools loom like a galore of poisons and tranquilizers plus hundreds of different brands of aspirin prescribed for a widest range of diseases. Traders love coctails, though, unnerved. A little bit of this and a little bit of that, shake well and chill. Mathematicians used to treat practical experiments with disdain and contempt. That is one of the reasons they were of little use. They are?
If you expect to win by the skin of false teeth... you are probably in Hollywood.
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Thank you for your support.
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