Strategy Based On Chart Pattern

trading strategies and money management discussion, code, results

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fatdog1
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Postby fatdog1 » Mon Jul 10, 2006 12:06 am

Ali,

Here is what I added to the DarvasBox code for a bull flag pole.
I added this to the code as a condition for taking the long trade.
I am not sure if or how it could be added to the code as a condition to plot the DarvasBox.


if Low [5] = Lowest( Low, Length )[6] {need at least 6 candles in the chart pattern which is the bull flag pole and the 5 candle flag}

and Close [5] > open [5] {this makes it a up candle}

and Volume [5] > Volume [4] {won't help in forex but the volume of the flag pole should be greater than the volume of the candles in the congestion area. Up volume over down volume in candle 5 over candle 6 would be even better}

That is what I came up with to describe a bull flag pole.
It does cut down on the number of losers in the DarvasBox code.

Can you send this to the guys on Tradestation who you contacted?
Ask them if they can add the bull flag pole to the DarvasBox code that plots the indicator so that the indicator only plots around the bull flag, if possible.

Here are the workspaces you asked for:
Attachments
GBPUSD 10 MINUTE 7-09-06.tsw
(22 KiB) Downloaded 16 times
GBPUSD 60 MINUTE 7-9-06.tsw
(129.5 KiB) Downloaded 18 times
USDJPY Weekly 7-9-06.tsw
(22 KiB) Downloaded 21 times

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fatdog1
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Postby fatdog1 » Mon Jul 10, 2006 12:56 am

Ali Son wrote:FATDOG1

I've been watching that TLCollection/YM Workspace 7-06-06, and I notice it took a buy trade today based on same prior 7/06 yellow/green trading range at the same white line trigger, for a big loss when the obvious trend was downward. Is it not working correctly? How are you using it?
-OS


Ali,

I update the charts I trade off of every day.
I don't update the workspaces I post here everyday.

The 7-6-06 mini dow chart missed a long trade from the day before at 11222 by 4 ticks, so the support in that area is not fresh anymore.

Even if you traded off that chart on Friday, you would have lost 20 points which is $100.00 in the mini dow at the green line which is the stop loss.

I traded the @US long on Friday.

fatdog1
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Postby fatdog1 » Mon Jul 10, 2006 1:26 am

fatdog1 wrote:
Ali Son wrote:FATDOG1

I've been watching that TLCollection/YM Workspace 7-06-06, and I notice it took a buy trade today based on same prior 7/06 yellow/green trading range at the same white line trigger, for a big loss when the obvious trend was downward. Is it not working correctly? How are you using it?
-OS


Ali,

I update the charts I trade off of every day.
I don't update the workspaces I post here everyday.

The 7-6-06 mini dow chart missed a long trade from the day before at 11222 by 4 ticks, so the support in that area is not fresh anymore.

Even if you traded off that chart on Friday, you would have lost 20 points which is $100.00 in the mini dow at the green line which is the stop loss.

I traded the @US long on Friday.


Ali,
I am posting a new Eurusd workspace today.
It is not a workspace I plan on trading off of since I don't trade forex.

It is only updated to reflect what happened on Friday since the Euro went higher.

So there is no confusion about which charts I have updated, all the charts will have a current date on them to reflect the changes from either the day before or the last time I updated it. If it is a workspace I plan to trade off of, it will say trade workspace.

Some of the older charts on this website have areas of support and resistance on them that will be support or resistance in the future.
Some don't. I don't have the time to go back and update them all on a daily basis, sorry.

FD1
Attachments
EURUSD 60 MIN 7-09-06.tsw
(23.5 KiB) Downloaded 21 times

Ali Son
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Postby Ali Son » Mon Jul 10, 2006 8:43 am

I will add the code you provided to the TS guys as well as some pics to the lengthy description that I already provided.

Thanks for the worspaces. I figure the weekly ones will certainly not go stale anytime soon.

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Postby Ali Son » Tue Jul 11, 2006 11:52 am

This is true indeed. That's the way to approach it, seeing if there is a codable symmetry,since it's all about channels, i.e. mini cycles.


TheRumpledOne wrote:Nice work, fatdog1!!

To me, CONGESTION is a function of time and price range.

That's a indicator screaming to be coded.

I think the NickNxtMove indicator tries to do that.

Hmmmmmmmmmm.............

https://www.tradestation.com/Discussion ... c_ID=29357

https://www.tradestation.com/Discussion ... ic_ID=3458

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Postby fatdog1 » Tue Jul 11, 2006 12:05 pm

Good morning Ali,

I can't take any credit for what I do.

It is all based on Stan Weinstein's work from his book, "Secrets for Profiting in Bull and Bear Markets.

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Postby fatdog1 » Wed Jul 12, 2006 8:10 am

Hi Ali,

Tradestation made a few modifications to the
trendline entry code.

Here is the eld and a workspace for the EURUSD.
I have it set to take a practice trade so I can make sure the stop loss and profit targets are working correctly.

You can enter the number of contracts you want to trade as an input.
You can enter intrabar on the 60 minute chart.
You can enter -1 to get the code to take a short in the inputs when the Euro trades near 1.2787.

It looks like it will trade near 1.2752 first today for a long.
It still has to touch the white line to enter a trade.





The DarvasBox caught this bull flag breakout on Friday for the 30 year bond. This shows that the congestion area can be big as long as it is
a tight range and still produce a nice trade.

Attachments
T_L ENTRY COLORS.ELD
(7.24 KiB) Downloaded 57 times
EURUSDTrade Workspace 7-12-06.tsw
(99.5 KiB) Downloaded 46 times

Ali Son
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Postby Ali Son » Thu Jul 13, 2006 11:34 am

Thanks Fatdog1. I will take a look at it.

Yesterday, I posted the updated Darvas Code on the two TS threads that you and I started a week ago. This morning, I will post4- 5 pictures from this site that you posted that I think best illustrates the bul-bear flag technique, including the one that you sent me yesterday. It should get things going as people have been asking for clarification and there are 300+ views of 1 of the 2 threads. A picture is worth the thousand words I wrote.

-Optionswings

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Postby Ali Son » Fri Jul 14, 2006 6:33 am

Fatdog1:

I got this response today:

"OptionSwings,

Can you write a statement in English which defines the flag pole in terms of the following values?
1. Horizontal size (# bars)
2. Price breakouts
3. Percent gain in price,
4. 'Flagpole low' compared to low with 'x' bars
Etc."

Can you accomodate this request, elaborating on it in simple language that can be coded in any way?

fatdog1
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Postby fatdog1 » Fri Jul 14, 2006 9:41 am

Ali Son wrote:Fatdog1:

I got this response today:

"OptionSwings,

Can you write a statement in English which defines the flag pole in terms of the following values?
1. Horizontal size (# bars)
2. Price breakouts
3. Percent gain in price,
4. 'Flagpole low' compared to low with 'x' bars
Etc."

Can you accomodate this request, elaborating on it in simple language that can be coded in any way?


Hi Ali,

I sent you a PM with this information before I saw this post this morning.
Someone else sent me that post from Tradestation last night.

Here is the answer I came up with.

Hi OptionSwings,

Here is a reply for Mark Mills.
I used the Tradestation User Guide to help me find answers to the 4 questions below.

Just as a flag sits on a flag pole, the flag pole should be
some kind of long key reversal candle indicating that the market is near strong enough support or resistance to indicate a possible reversal of the short term trend.

After the initial thrust, the market will go horizontal as the buyers and sellers try to decide on the next direction.
The length of the horizontal area can vary. A minimum of 5 bars in the congestion area is perferred.

My thought is that a upward breakout from a congestion area that is proceeded by a up bar indicates a uptrend and
should be more successful than a upward breakout from a congestion area that is proceeded by a down bar.

I have added the key reversal LE code to the DarvasBox strategy code as a filter to take a long trade.
I have also added the key reversal SE code to the DarvasBox strategy code as a filter to take a short trade.

I would like to add the key reversal condition to the actual DarvasBox code as a condition to be present before the box plots.

Thanks for the help,
FD1

OptionSwings,
Can you write a statement in English which defines the flag pole in terms of the following values?

1. Horizontal size (# bars) ( a flag pole is 1 vertical bar or candle)

2. Price breakouts ( Close is higher than the open for a bullish key reversal bar , Close is lower than the open for a bearish key reversal bar)

3. Percent gain in price, ( a 50% gain in price difference between high and low of key reversal bar minimum)

In addition, if possible, include a volume study to indicate up volume exceeding down volume
for bullish key reversal bar and down volume exceeding up volume for bearish key reversal bar. The volume of the key reversal bar should be greater than the volume of the bars in the congestion area.
I found this in the Tradestation User Guide:
(Note, Using the Key Reversal Up ShowMe Study with an indicator such as OBV (On Balance Volume) or an indicator that uses volume and price to determine buying and selling pressure enables you to more accurately analyze a market.


4. 'Flagpole low' compared to low with 'x' bars Etc. ( key reversal bar definintions) A bullish key reversal is characterized by a bar whose Low is lower than the previous bar's Low but ultimately closes higher than the previous bar's Close.
A bearish key reversal is a bar pattern consisting of a bar whose High is greater than the previous bar's High but ultimately closes lower than the previous bar's Close.

Mark Mills
Senior EasyLanguage Engineer, TradeStation Securities, Inc.

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