As I’ve been mentioning… Bill’s Arrows are awesome. But, they are also conservative. And, even if it’s not in their best interests, some people want more action than that. I swear, many beginners would rather lose money trading fast than make money trading slow. Sad but true.

So, I’ve been working on a new kind of entry indicator, that attempts to catch all the moves in the market. Sure, if you attempt to do that, you have to be willing to take some swings that miss. But, this morning I arrived at something that looks promising. Here’s Friday’s action in 2584 share bars, across two screenshots:

There’s 18 trades on Friday, 9 trades on each screenshot. 16 Wins and 2 Losses. I highlighted the losses on the charts above… it was easier than highlighting all those wins! :-) Obviously more research is needed…

The indicator is built out of GCycle Stochastics, Market Sync, VRam Bars, the Rank Sum Tests, Alla’s Average, the Rolling VWAPs, and a new variant of volume indicator I threw together this morning. Except for the new volume variant, all of these are available today from eotpro.

The tall Red and Green lines are meant to be the more confident entries, while the shorter cyan and magenta lines are more for aggressive entries or trend hijacking. That’s the intent anyway… I’m not sure yet if you should play them any differently. This chart is set up so that early exits are gauged by Bonnie’s Bars (the paintbar), as usual. That’s how I gauge which are wins vs losses, anyway, for these purposes. It’s assumed that if you show 1.5 points or more profit, that you won’t let the trade become a loss.

Just please try to remember that the faster your signals are, the more skill and discipline you need to actually make money from them. Beginners really would be best served by learning a conservative approach like the Arrows we’ve released.

I was so happy to see this forum post! I have been helping several people make small modifications to their charts with my eotpro Elite Series add-on package, which is great. But, now I see an example of someone taking a trading system they’ve put together, and using the Elite Series to clean up their chart substantially. He reports that trading that way is much less stressful and error-prone, which has been my soapbox issue lately. And best of all, he was able to do it without any assistance from me. I’m always looking for validation that a programmer could take the functions and the docs and do something useful with them. The people that I’m helping generally have little or no programming experience, so I can’t judge by them.

Now, if I could just reverse-engineer his trading system from the chart… hmm…. :-)

Posts like this one are why Bill Rempel’s blog stays on my list of favorite market blogs, even though his trading style is completely different than mine.

From the post:

“Post Script: this happens in every industry, not just pharma. There is probably not a single cleaning or disinfecting product in your home that you couldn’t replace with either plain soap, baking powder, chlorine or oxygen bleach, or vinegar. But where are the profit margins in selling those??? The profit margins in developing new, patentable, cleaning molecules and contraptions is high. Talcum powder is incredibly effective against fire ants, but low-margin compared to far more expensive, and less effective, bait poisons. On it goes …”

I can’t say firsthand whether the statements about those particular products are true or not… but it’s good to remind yourself once in a while that companies care more about profitable products than effective ones.

I talk about some of the latest stuff in the eotpro elite series, which I developed.

Here is the link for the video:
http://eotpro.acrobat.com/p74111176/

Here’s the link for this week’s eotpro Elite Series seminar: http://eotpro.acrobat.com/p27832528/. We had some good questions this time… so much so that I didn’t get to go over many of the functions!

This one’s for you, Rafal!

This will go into the May release. It’s a complement to the existing functions for identifying divergences. This one identifies hidden divergences.

I didn’t even get to turn on my platform today, so I have no idea how the markets went. But, according to Jessica, I don’t merely offer market information. No sirree. I am also a lifestyle advisor. So, here’s a tip from me to you: take a day or two off every now and then. The markets will still be there tomorrow. Get a swedish massage. Or alternately, massage a swede or two.

Here are a few screenshots I put together as advertisements for my eotpro elite functions series. They’ll be posted on tradestation forums during the week, but loyal readers here can see them now.

They show off example trades from the setup I have been showing in the live room lately. This was just a simple system I threw together with little or no thought, but over the last week or two in the live room it’s held up pretty well. I think with some tweaking and study it could be tradeable. It’s conservative, in that it doesn’t trade many times per day, but has a very high win rate so far. Not to mention, Bonnie’s Bars tend to keep the losses in the 0 to 2 point range, which is pretty sweet.

What’s interesting to me, is that it doesn’t even use a volume indicator! Funny… and that makes me want to test it on forex data, when I get the chance.

Anyway, as the ads proudly state, this is just one of the many ways you can combine these indicators. I’m biased, of course, since it’s my code… but I’ve been very impressed so far with how well the elite functions and indicators work in concert. Little demonstration ideas like Alla’s MACD and this setup have turned out to be very promising in their own right. I had no idea that would happen so easily, when I put them together.

I come in at about the 46 minute mark. But you may want to watch Bill and Glen’s sections. Glen previews a new scalping method he’s working on, which looks pretty cool. Here is a link to the streaming video:

http://eotpro.acrobat.com/p78032922/.

It was great that there were so many questions. I enjoyed the Q&A part. On the other hand, there were so many questions that I only got to show off a small fraction of the elite package I’ve made available. I was able to go over quite a bit more at my first seminar.

I downloaded the latest tradestation build tonight, and played with the simulator and new matrix features. I’m pretty pleased with the new stuff. I know a lot of folks say “too little, too late,” but I have actually been pretty happy with TS.

• Good Math, Bad Math : Random Variables
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Someone was asking me how easy it is to make a basic strategy out of the elite function series I am offering through eotpro.com. In particular, their mail said:

Do you have an example strategy with the Easy Language code that utilizes some of the Elite functions? …. For instance take the first PattyB signal after a bias line change, but only if Market Sync is with the trade.

My response:

…here is a strategy that gets in on the first patty b after a bias line change, if market sync is with it. It keeps a stop 2 ticks behind the last plot cycle, and gets out if it shows $200 profit:

vars:
pb(0),
ms(0);

// set up the indicators
pb = $rtFirstNPattyBs(…pattyb input values…);
ms = $rtMktSyncPredict;

// entry rules
if(pb = 1) and (ms >= -1) then buy next bar at market;
if(pb = -1) and (ms <= 1) then sell short next bar at market;

// keep a stop beyond last plot cycle
sell next bar at $rtPlotCycleStopL(2) stop;
buy to cover next bar at $rtPlotCycleStopS(2) stop;

// take $200 if we can get it
setprofittarget(200);

That’s not intended for real-world use! But, it’s an example of how simple things are simple, with these building blocks. The kinds of things that eotpro clients tend to ask for are packaged up, ready to be dropped into a strategy or custom indicator. Stuff that trips up non-programmers, like tracking the bias line and making sure you only take one signal (and only if it’s within the first few bars after the bias change, etc.) is all taken care of for you.

• The LRMS: Logistic Regression Markov Chain — uglychart.com
  (tags: artificial_intelligence gambling)

• Good Math, Bad Math : Schools of thought in Probability Theory
  (tags: mathematics statistics)

• [Chicken-users] macro systems and chicken (long)
  (tags: lisp scheme macro)