Walter`s Forex "Trend Trades"

[ztrader]

Originally Posted by walterw Glad to hear that Don ¡¡ Hi Derek, glad you like this thread... about Bemac`s formula I had open this thread on TSD http://www.forex-tsd.com/indicators-...l-vma-mt4.html asking for help coding into MT4 ... I hope some charitable coder can help us... so we can have it on MT4 wich is a much more friendly platform... in that thread you can see Bemac`s formula being posted... so far here Blu-Ray has been able to code it into TS... so I think he is more enlighted into how the formula really works... cheers Walter.

walter.

Your presentation here is very good, though I must admit I have not read the entire thread YET. If you do not get a responsse from "some charitable coder" to convert Bemac's forumula into mq4 format by the end of U.S. session tomorrow, I will have it done for a fee by one of the programmers I use. I will keep you posted.

ENJOY!

ztrader

[walterw]

So I step here into the "surefoot" trend trades...

Lets start by using plain logic... when do you have more probabilities of traveling more distance ? when you "start" traveling or when your journey its at half way or when its about to finish ? well sounds stupid question uhu ? the answer its simple... when you "start" traveling you have more probabilities of traveling more distance...

This is a plain true that some traders actually dont understand... why ? there can be lots of answers for that... maybe the most classic would be this :they dont know really on what stage of the journey they are situated... other they do know but greed its so bad they cant help it... BUT here statistics will play a great roll in favor of those that will only play from the start and not from old trends...

The temptation is great sometimes as the reasonig you may argue is, there is great amount of strength... this will keep going UP ¡¡ I can make more $$$$ I will be so much richer if I keep trading on this magnificent super move... Walter says there is momentum ¡¡ (he also warned about exhautions)... so this game of compulsive proportions many times finishes playing against your most valuable interests...

Man in his human nature does that over and over again... he plays against himself, he is expert on that... will you let that natural aspect also play on your trading ?

So I know we may difer on this opinion with some fellow traders.. but so far in my experience.. playing from the start of a move is more conservative than playing when she is quite possibly exhausted or already not that fresh...

I continue on next post... cheers Walter.

[walterw]

Originally Posted by ztrader walter. Your presentation here is very good, though I must admit I have not read the entire thread YET. If you do not get a responsse from "some charitable coder" to convert Bemac's forumula into mq4 format by the end of U.S. session tomorrow, I will have it done for a fee by one of the programmers I use. I will keep you posted. ENJOY! ztrader

That would be great man ¡¡... thanks for your help... cheers Walter.

[momentom]

Re: Exits
Great stuff Walter as I said.

May I offer this comment. As an ex floor trader, my big problem since leaving the floor over 15 years ago is staying in a trade long enough even though I am a scalper. Exiting on the re-entry into the rainbow of the 1 minute chart looks like exiting very early. That's OK if there is a quick re-entry but there is often not. Maybe a little more optimisation could help here.

I tried using ATR stops at first to help me out but looked to the rainbow for a proper solution wanting to remain faithful to your concept.

I then looked at each band according to its colour to try and match the ATR.

My solution so far is an entry into the 6th colour band of the rainbow on the 1 minute chart - CYAN in my case - as my profitable exit. I have only eyeballed this and have not done a proper backtesting - needs some decent programing in MultiCharts.

What do you think?

[walterw]

For some of you who already had been following some other of my threads... you might be already familiar with my "Icon" trade pattern... well actually its not mine... its old as TA... I only just revisited and tried to show on diferent presentations, some threads that deal with it are this http://www.traderslaboratory.com/for...us-1916-2.html other from a scalper view http://www.traderslaboratory.com/for...rade-2147.html here I did use this classic pattern on diferent contexts...

Once again let me explain what an Icon is..

An Icon is the first continuation after a cross...



Very simple pattern that is present in all the fractal structure of the market... if we had to describe its formation we would say we have a 1rst intention wave, take a little brake and resume on the same direction...

Now that we are talking about "trend trades" the icon is a form of trend trade... but the true edge of the Icon relies on the fact that he is situated on the begining of a move... not on an old instance of a trend but on a prospect bran new move ahead...

There is no guarentee that the move will develop, but you clearly know you are on the best spot if the move will actually do so... Thats what the Icon can do for you... he can select the best places for our trades, we can become more selective as we take an "iconic trend trade"...

So let me expand on how to read this Icon on the context of our VMA rainbow... on next post cheers Walter.

[walterw]

Originally Posted by momentom Re: Exits Great stuff Walter as I said. May I offer this comment. As an ex floor trader, my big problem since leaving the floor over 15 years ago is staying in a trade long enough even though I am a scalper. Exiting on the re-entry into the rainbow of the 1 minute chart looks like exiting very early. That's OK if there is a quick re-entry but there is often not. Maybe a little more optimisation could help here. I tried using ATR stops at first to help me out but looked to the rainbow for a proper solution wanting to remain faithful to your concept. I then looked at each band according to its colour to try and match the ATR. My solution so far is an entry into the 6th colour band of the rainbow on the 1 minute chart - CYAN in my case - as my profitable exit. I have only eyeballed this and have not done a proper backtesting - needs some decent programing in MultiCharts. What do you think?

I will have to agree with you momentom on the implemetation of a little more tolerance like taking a slower ema for closing positions... actually thats the idea here to make some interaction about this issues...and I would love to hear what results some manual backtesting would give you... obvioulsy my scalper exit is really that... its a quick scalp...

I am working on a paralel aproach that will be 100% aimed for scalpers but I think I want to finish presenting all this before getting into that, even opening a diferent thread for that scalping variation will be more organized...

Thanks for interacting momentom... had you seen any setup this evening ? cheers Walter.

[walterw]

So how to read an Icon on a VMA rainbow context...

Very simple, remember we are trading from a 5 minutes chart so we focus on that main time frame to find our "iconic trend trades"...

On the below chart you will notice some icons being formed arround the VMA Rainbow...



sometimes during the first intention move (cross) we still dont have the black line on the proper side of the magenta... but price action speeks for himself... he crosses with energy the magenta line, pullbacks to this rainbow and then he is ready to travel... he has the potential of an "entire" move...

You know how many icons from the vma rainbow you have per week ? by the dozens.... I want 20 bucks per week/contract... can you become enough disciplined just to take Icons ? well let me tell you they are "surefoot" trades because in the worst scenario you will get a very tight stop against a great potential on this trades... so that is the most "surefoot" trend trade on our aproach... taking the icon from the begining of a prospect move... cheers Walter.

[PYenner]

ztrader
If you do go to a pro, ask for just the 3 main lines, MA1=Black, MA12=Dark Green and MA49=Magenta. MT4 will only do 8 lines. I am inclined to think the rainbow serves little purpose, but more lines could be added in later if needed.
Good of you to offer.

Walter
I'm working my way through the Bemac version.
So far it is not as complex as it first seemed.
His use of ADX labels is misleading.
eg ADXPr is an input constant preset to 8.
The Wilders function turns this into 8*2-1=15 (periods) and returns a 15 period ema on the input price eg PlusDM and Tr are just Close prices.
Less complex than it looked.
Only half way through yet and coding would likely take me a week even if I can do it and there is no certainty of that.
Sorry I can't be more definate.

[momentom]

Originally Posted by walterw I will have to agree with you momentom on the implemetation of a little more tolerance like taking a slower ema for closing positions... actually thats the idea here to make some interaction about this issues...and I would love to hear what results some manual backtesting would give you... obvioulsy my scalper exit is really that... its a quick scalp... I am working on a paralel aproach that will be 100% aimed for scalpers but I think I want to finish presenting all this before getting into that, even opening a diferent thread for that scalping variation will be more organized... Thanks for interacting momentom... had you seen any setup this evening ? cheers Walter.

I'm afraid my traderDNA is stronger than I am and I have jumped to your parrallel approach and am scalping the DAX with this method using 1 minute and 15 second charts. I'll add in what I find once you have started the new scalping thread so as not to polute this one. Going REALLY great so far.

[momentom]

Originally Posted by PYenner ztrader If you do go to a pro, ask for just the 3 main lines, MA1=Black, MA12=Dark Green and MA49=Magenta. MT4 will only do 8 lines. I am inclined to think the rainbow serves little purpose, but more lines could be added in later if needed. Good of you to offer. .

PYenner, you are right in one way about needing only 3 lines. I deleted most of the rainbow and left just those three when I first looked at this - I believed the screen was too cluttered. However, I quickly returned to the full rainbow as I found that I was able to "see" better when the fan opened and closed. But maybe that's just me.