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2009.05.08 TRO_PRICE_IS_THE_SAME




TRO_PRICE_IS_THE_SAME will draw lines from the opens of the previous time periods to show you how price has moved.

FREE MT4 version of TRO_PRICE_IS_THE_SAME, including SOURCE CODE, attached.


PLEASE DO NOT POST MY INDICATORS ON OTHER FORUMS.

PRICE IS THE SAME ON ALL CHARTS.

Has it sunk in yet?

There is only one price at any time, so every chart will show the same price at any time. However, what is considered as "noise" in a higher time frame would be "trends" in a smaller time frame. e.g. H1 chart could be ranging within 40 pips but within a M5 chart, some up and down trends would have happened within this 40 pips range.

People could be confused by your recommendation to set a fixed 10 pips stop loss for 2% risk in the rat reversal method. (I may not agree with using a fixed 10 pips for every currency pairs as you have advocated, but that's less important for a separate topic). Now, the execution of this method has been based on M5 chart. If the same method were to be used in a higher time frame, I am pretty sure the 10 pips will not be able to withstand the "noise". Even the entry may not be able to fall within the 20 pips trade zone from the daily high/low if the method is applied in a higher time frame such as a H1 or H4 candle. It's probably this issue that people are seeking clarification.

There is NO NOISE!!

There is only ONE TRUE CHART - THE 1 TICK CHART.

All other charts are DATA COMPRESSION OVER TIME and these charts are all derived from the 1 TICK CHART.

What do you get if you add up noise? MORE NOISE!! It makes no sense to call lower time frame charts noise.

You do NOT trade charts... YOU TRADE PRICE and PRICE IS THE SAME ON ALL CHARTS. A stop loss of X is going to be hit NO MATTER WHAT CHART YOU ARE LOOKING IT IF PRICE MOVES ENTRY MINUS X if you are long and ENTRY PLUS X if you are short!!

You are sounding like a YALE STUDENT.

Hi TRO,

First, I don?t wish to be caught up with labeling anyone with names because that will only produce more heat than light. It doesn?t matter whether I sounded like a Yale student or Harvard professor, or a wannabe Rat. All I am trying to do is to share my views and to listen and learn from anyone who bothers to do likewise. As such, I appreciate your reply which I can fully understand from your perspective.

I am not so much concerned with the terminology than the method. That is why I had bracketed the word ?noise? and ?trends? in inverted commas in my previous post because they are all relative to the timeframe. What is ?trend? in a H4 chart may also just be ?noise? in a Monthly chart, so it?s not limited to the example I have mentioned previously with M5 vs H1 chart.

The point I want to make is that people may not really be ignorant about the fact that price is price is price and that is the same on all timeframes. Rather, people may be more interested to know whether the rat reversal method of entering a trade can be applied in a higher timeframe like H1, H4 or even a daily chart - which if the trade entry were to be taken from the reversal candle?s high/low in a higher timeframe, the 10 pips stop loss at 2% risk may not be suitable because the average range of a higher timeframe candle is more likely to wipe it out. To stick to this risk setting means the trade entry will be more reliable if it is taken from a reversal candle in a M5 (and possibly also M15) chart. There are people who cannot afford to stick to their screens and they may be wondering how the method can be applied in higher timeframes.

TRO, please do not get me wrong. I am not trying to undermine your expertise. I hope I have clarified my purpose in this reply.

It doesn't matter what the time frame of the chart is because PRICE IS THE SAME ON ALL CHARTS!!


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 are "stuck" thinking that there is something "different" when you change time frames. THERE IS NOT - IT IS AN ILLUSION!!

The daily low IS the SAME on ALL time frames. Either you understand that, pass GO and collect 200 pips or you go directly to Yale, do not pass GO and do not collect 200 pips...LOL!!!

TRO, I do not disagree with you up to the point you are clearing things up. It has been an interesting exchange and I'm sure those who read this topic can understand the perspectives we are coming from and take away something useful for themselves.