2011.01.04 THE RAT ADAPTS

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TygerKrane
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Postby TygerKrane » Mon Jan 10, 2011 4:56 pm

{Taking a little breather from work...}
trueblue, here goes...

M5 chart compressed (yes, it DOES look like Rorschach, :D )
The bigger CC represents Daily Candle; the smaller CC represents H1.

Buy Zone allows you to scalp in either direction at day open based on the statistics that price MOVES from the Day Open (it can't be denied, price always does that. Additionally, you RARELY get a 20 pip range day with a max of only 10 pips on both sides of the open.)

Couple that with trading in anticipation of a D1 Rat Reversal being formed and that is the line of logic you are going with.

Another thing you might could see is that he can scalp either direction via the Buy Zone; but he'll be biased to hold the trade longer which allows for a D1 Rat Reversal to be fulfilled when all is said and done and the D1 candle actually closes.

~Krane

::EDIT::
newscalper replied while I was posting my reply

**Krane catches Tyger** !>I'm here to chew bubble gum and make major pips...and I'm all out of bubble gum.<!

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pritam1232007
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Postby pritam1232007 » Mon Jan 10, 2011 5:34 pm

TygerKrane wrote:{Taking a little breather from work...}
trueblue, here goes...

M5 chart compressed (yes, it DOES look like Rorschach, :D )
The bigger CC represents Daily Candle; the smaller CC represents H1.

Buy Zone allows you to scalp in either direction at day open based on the statistics that price MOVES from the Day Open (it can't be denied, price always does that. Additionally, you RARELY get a 20 pip range day with a max of only 10 pips on both sides of the open.)

Couple that with trading in anticipation of a D1 Rat Reversal being formed and that is the line of logic you are going with.

Another thing you might could see is that he can scalp either direction via the Buy Zone; but he'll be biased to hold the trade longer which allows for a D1 Rat Reversal to be fulfilled when all is said and done and the D1 candle actually closes.

~Krane

::EDIT::
newscalper replied while I was posting my reply


so if rat adapt say short on daily , then one should only go short with his 15min/5min rat zone. am i right .or do i have to look weekly open also...
.. please reply..

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newscalper
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Postby newscalper » Mon Jan 10, 2011 6:14 pm

No prit. You observe whether price is above or below weekly open. If above green rats are running, if below, red rats are running.

If green rats running:
Look for a red daily bar followed by a green daily bar.
Enter long the next day at daily open +4

If red rats running :
Look for a green daily bar followed by a red daily bar.
Enter short the next day at daily open -4

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trueblueTEX
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Postby trueblueTEX » Mon Jan 10, 2011 6:41 pm

newscalper,

so, 2 days are required for the setup (red day candle followed by a green day candle) and then you can enter (green = long) on the 3rd day. open+4 is open of the 3rd day, correct?

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Postby newscalper » Mon Jan 10, 2011 7:13 pm

Yes AFAIK

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Postby TheRumpledOne » Tue Jan 11, 2011 12:15 am

newscalper wrote:Thanks TRO. I'm sure most of us know price is the same on all timeframes...and yes I know I'm mixing strats etc so many times in NLA, Zline etc etc etc we see that this entry failed because this that or the other didn't happen and that we need to look for this that or the other on one timeframe or another, are we into timing entries or not?

Isn't the normal rat entry based off a 5 minute chart...yes I know price is within 20 pips of daily low or high but the entry itself is TIMED using a 5 minute chart.

Sorry, I know I'm a PITA :oops:



Let's clear things up:

1) To trade like a RAT is to ALWAYS trade in ONE DIRECTION - either LONG or SHORT. Once you pick a "team", you can't switch.

2) The "within 20 pips of the daily high/low" is the BEST possible entry to get the maximum run BUT the RAT REVERSAL entry works ANYWHERE on the chart.


You can use ANY entry method. But you should ENTER within 20 pips of the daily low.


GREEN RAT REVERSAL - LONG ENTRY CRITERIA:

1) RED CANDLE CLOSES
2) GREEN CANDLE CLOSES
3) PRICE TOUCHES HIGH OF PREVIOUS GREEN CANDLE - ENTER LONG. STOP LOSS IS ALWAYS 10 PIPS.

DRAIN THE BANKS - LIKE A RAT

1) Price within 20 pips of the daily low - that is OPPORTUNITY

2) Red candle closes

3) Green candle closes - note the high price of the green candle.

4) Enter long at the green candle's high price

5) STOP LOSS IS 10 PIPS

6) Take whatever profit you can.

7) If the rules do not mention it, then it is of no concern.


"The technique is so simple that just several lessons (or a few pages of explanations) cover it all. Now what? Now the student has to practice, practice and practice again to understand what he had been taught. The teacher DOES know much more than the student, but his understanding can't be "passed", "transferred" or taught in any way -- not even by reading books."
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!

Please do NOT PM me with trading or coding questions, post them in a thread.

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TheRumpledOne
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Postby TheRumpledOne » Tue Jan 11, 2011 12:18 am

wangyue22 wrote:hello newscalper, correct me if i am wrong here TRO,

the reason for going into 5 min to trade is

1. most of us here have very little equity
2. most of us here want profit right away

5 minute chart gives us compare to a weekly chart

1. tighter stoploss (mentally, its easier to consider a 20 pip loss compare to a 200 pip loss, but you could do the same with 200 pip loss, just 1/10 the position size)

2. 5 minute chart will give us indication whether we are right or wrong right away, and also let us take profit anywhere from 1 minute - 30 minute ish, where as a weekly candle, you have to wait a day or a week for that profit/loss to be realized.

hope that helped and not caused more confusion

p.s. i dont think sorry is neccessary, TRO truly want to help and people who are attracted to this forum are mostly good people as well, we are really here to help each other ^.^


You are wrong!

PRICE IS THE SAME ON ALL TIME FRAMES.

Does it really matter what chart you are looking at AFTER you enter the trade? Price is going to be the same on all charts.

What about this makes it so hard to SEE?
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



Please do NOT PM me with trading or coding questions, post them in a thread.

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TheRumpledOne
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Postby TheRumpledOne » Tue Jan 11, 2011 12:31 am

newscalper wrote:
TheRumpledOne wrote:Image

Long trigger is open + 4.

You can see from the frequency distribution that over the last 100 days, this would be profitable more times than not.

Using what was learned from the BUY ZONE and the RAT should prove to be very profitable .

ADAPT OR PERISH!


TRO - you've missed the advice or rule about above below weekly open out of the rat rules, last rule is if it doesn't mention it it's of no concern so this needs to be mentioned I think?

Right...dagnabbit :) I'm going to open Pandoras box and ask.

I cannot SEE that over the last 100 days this would have been more profitable than not. All I SEE is that price more than not eventually went more than 20 pips, it doesn't take your 10 pip stop and negative excursion from your entry into account.

I know I had this conversation with you before Christmas about something else and your answer was it was in the realm of back-testing and we know your view on that.

OK, but how is looking at past bars and how far they've moved in one direction not back-testing? How it it any different to knowing how far they've moved in one direction before how far they've moved in the other, it's just another statistic?

I'm just looking for clarity of thought on this, please.

I'm left handed btw. :?


Statistics is NOT the same as back-testing.

The stats I run show how far price moved from open to high and open to low for the rat reversal trigger. I am not concerned about anything else when it comes to stats BECAUSE after I enter a trade, PRICE is the ONLY thing that matters. Either I will exit with a profit or a loss.
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



Please do NOT PM me with trading or coding questions, post them in a thread.

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TheRumpledOne
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Postby TheRumpledOne » Tue Jan 11, 2011 1:59 am

Let me make it simple.

If you see a RAT REVERSAL setup on the D1 THEN you can trade that pair using either the BUY ZONE or entering within 20 pips of the current daily low.

Image

On the daily chart BOTH the target and stop were hit.

Image

On M5, you can see that a buy zone entry would have netted over 10 pips BEFORE REVERSING. Then taking rat reversals within 20 pips of the daily low paid off.

This is why I say, "Take whatever profit you can."

Image

Can you see why "DO NOT TRADE AGAINST H1 CANDLE COLOR" is a RULE OF THUMB?
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



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pa
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Postby pa » Tue Jan 11, 2011 2:17 am

Here's an issue I've noticed. Please correct me if my assumptions are wrong. It's a crap shot on whether price will continue in the intended direction in order to bank a profit.

Sometimes it does; sometimes it doesn't. Net/net, unless a runner is found, your stop-outs will slowly eat away at your brick of cheese.
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