TRO PLOT - SCALP ANALYSIS

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TheRumpledOne
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TRO PLOT - SCALP ANALYSIS

Postby TheRumpledOne » Wed Jul 18, 2007 12:04 am

TRO PLOT - SCALP ANALYSIS



I loaded 2 occurences of TRO PLOT into a chart. One has high - open, and the other has open - low.

I plot as a histogram.

This shows me how much I could have scalped each minute.

Workspace attached.

You should have the TRO PLOT indicator loaded by now... if not, shame on you...LOL!
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Last edited by TheRumpledOne on Wed Jul 18, 2007 12:54 pm, edited 1 time in total.
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BuyZone statistics in action

Postby 4x=0 » Wed Jul 18, 2007 6:38 am

.6(4)+.4(-9)= -2.6% expected return

Looks like a 60% win rate results in negative returns with this particular system

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Postby cvax » Wed Jul 18, 2007 8:58 am

4x=0 I'm interested in how you came up with those numbers. Are you using the buy zone system to determine them?

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Re: BuyZone statistics in action

Postby TheRumpledOne » Wed Jul 18, 2007 12:57 pm

4x=0 wrote:.6(4)+.4(-9)= -2.6% expected return

Looks like a 60% win rate results in negative returns with this particular system


What's .6 and .4 ??

What's 4 and 9 ??

It should be OBVIOUS when the best time to scalp is.

Not to mention, if you only try to scalp a dime instead of .20, the win rate is higher!!
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Postby 4x=0 » Wed Jul 18, 2007 6:50 pm

s**t, that calculation is actually incorrect, sorry. The REAL expected return is -1.2%

Here is the formula for expected returns (r^):

It means, add up the results of the probabilities(Pi) multiplied by the return for the probability (ri).

In this case we have the win rate. Those loss rate is (1-win_rate).

so for example win rate .6 <---this is our "win" probability state
so loss rate will equal .4

What happens when we win? we get 4 net pips aka 4%

When we lose we lose -9 pips aka -9%


So then,

.6(4) = 2.4%

and

.4(-9) = -3.6%

The sum of these 2 is -1.2%


As the excel graph shows, you would need a win rate of at least 70% in order to have an expected return of .1%



This means that if you were to take every BZ trade you would lose your ASS. Therefore, it is now settled that you do not want to take EVERY bz trade. Only the good ones.
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Postby TheRumpledOne » Wed Jul 18, 2007 6:55 pm

Where are you getting a .6 win rate?


This is dollars and cents, not pips here!


Notice most of the best trades happen during the first hour.


Take your money quick, quit and go play!!
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



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Postby 4x=0 » Wed Jul 18, 2007 7:40 pm

TheRumpledOne wrote:Where are you getting a .6 win rate?


I am getting it from here --> "The BuyZone is a STATISTICALLY calculated trade. If you take every trade, the WORSE you'll do is around 63% BASED ON STATISTICS - no thinking!!"


>This is dollars and cents, not pips here!

OK no pips. A bz win is 4% gain when using 1 lot per $100 account equity.


>Notice most of the best trades happen during the first hour. Take your money quick, quit and go play!!

unknowns:

A. take profit in %
B. stop loss in %
C. win/loss ratio

Expected Return = (C*A)+((1-C)*(B))

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Postby 4x=0 » Wed Jul 18, 2007 7:59 pm

Last edited by 4x=0 on Thu Jul 19, 2007 3:20 am, edited 1 time in total.

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Postby kahoonya » Thu Jul 19, 2007 12:38 am

TRO

I do not see how you are using this. All I see is how much one could have made on a perfect entry/exit.

I am not that good

Kahoonya

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Postby TheRumpledOne » Thu Jul 19, 2007 2:22 am

Kahoonya:

That's the point.

Being able to SEE what you COULD HAVE MADE should give you the confidence to PULL THE TRIGGER the NEXT TIME YOU SEE the same setup!

This is using TRO PLOT as an ANALYSIS TOOL not as a trade trigger.
IT'S NOT WHAT YOU TRADE, IT'S HOW YOU TRADE IT!



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