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Old 12-13-2011, 09:58 PM   #17

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Re: Trading Tip #13: How to Pick Intraday Market Direction the 80% Rule

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Originally Posted by dangermouseb »
Anyway Josh... how did you determine 80% accuracy? would be interested to see your method and results... thx
I never claimed 80% accuracy; accuracy of what even? I have no idea what you're talking about. Maybe you confused me with the original poster.
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Old 12-14-2011, 12:58 AM   #18

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Re: Trading Tip #13: How to Pick Intraday Market Direction the 80% Rule

Okay, I just did some statistical analysis.

Used the ES, continuous contract, RTH only.

Out of the past 1000 trading days, here's the deal:

Number of times price opens below the prior value area, and after thirty minutes is either at or above the prior value area low: 53
Out of those, number of times the next 30 minute bar stays above the prior value area low: 23
Out of those, number of times the prior value area high is tagged before the day is over: 20

The good news: 20/23 is pretty good. The bad news part 1: the prior VAH was actually taken out during that second 30 minute period on all but 8 days. In other words, if you wait for the first 60 minutes, then on all but 8 days you had no trade. Of those 8 days, 5 hit the upper VA from the prior day.

So, in the past 4 years, 5 out of 8 days (62%) have fit the picture shown here where the price opens below prior value, and the first 30 minute bar closes inside, and the second 30 minute bar stays inside the prior value area.

For the other scenario, where the open is above prior day's value and the first 30 minutes close inside value, we have 67 days.

Of those, there are 30 days in which the second thirty minute bar stays within prior value.

Of those, 12 days are such that the second thirty minute period stays completely inside value (in other words, the value area low is not taken out during the second 30 minute period).

Of those, 6 days hit the VAL (50%).

So out of the last 4 years, the bottom line is, you have had a very small handful of days in which the scenario described here fits (53 days if we are liberal, 20 if we go by the description here), and of those we have a slightly greater than 50% win rate. In other words, don't hold your breath.

Hope this helps.

Larry, if you or anyone wants to dispute this analysis, please do so and I'll be happy to report more details though I really don't want to waste my time doing so. Maybe it would be better if you could post days where this actually worked.
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Old 12-14-2011, 03:06 AM   #19

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Re: Trading Tip #13: How to Pick Intraday Market Direction the 80% Rule

There has been no backtesting, the 80% figure is just a historical benchmark that gets banded about by people who have read a couple of books (from 15 years ago) on MP then suddenly think they've found the holy grail.

And of course vendors, who pretend to be helping newbies but really are just interested in getting there hands on newbies cash.

By the way thought I'd post one of MY customers testimonials.

" Dear ValueTrader,
Thanks you so much for teaching me your futures secret coin toss system technique trick tip. before I subscribed to your site I was a tramp or hobo as we call them in the US. Now I trade a multi-million dollar hedge fund. Your subscripition costs were cheap, (compared to the price of a car or house) and once I'd signed up you kept 1 to 1 tuition with me via you email news letter that bombarded my inbox. Also loved the trading room...20 half wits on MSM messenger with no more experience than me, all purporting to know the direction of the market, and pretending to be successful traders. Thank you so much again VT, you must be laughing all the way to the bank. A Dolt, Utah. "

VT
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Old 12-14-2011, 04:40 AM   #20

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Re: Trading Tip #13: How to Pick Intraday Market Direction the 80% Rule

Joshdance thx for the analysis - I did get you mixed up with the original. Apologies. I was hoping to flush out the BS which you did for me.

It strikes me that people say all sorts of nonsense that cannot be backed up empirically. Especially like x happens y% of the time. I can construct a trading system that makes money 90% of the time with no difficulty. The challenge is that when it looses it looses 9x as much as it wins so overall I have no edge!!! ;o)

I've not met a trader (yet) who makes strong claims (50.5% winners would be my cutoff) and is willing to put their trades up for analysis.

ValueTrader - great quote - how do I become a client

ATB

DM
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Old 12-14-2011, 09:34 AM   #21

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Re: Trading Tip #13: How to Pick Intraday Market Direction the 80% Rule

The thing is, I do think there is some value to statistical analysis having to do with the value area. However, the original criteria is not even clear. I did the best I could given the picture and description, but if one is going to claim 80%, then one needs to be sure the criteria for achieving it are clear.
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Old 12-14-2011, 09:43 AM   #22

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Re: Trading Tip #13: How to Pick Intraday Market Direction the 80% Rule

Hi Larry,
I looked at the ES charts starting from September 15 till today, and found one day - maybe two - in which these conditions were filled (the market opens above or below the value area, and then gets in the value area for two consecutive half-hour periods).

Did I miss anything?
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Old 12-14-2011, 10:10 AM   #23

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Re: Trading Tip #13: How to Pick Intraday Market Direction the 80% Rule

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Originally Posted by dangermouseb »
I've not met a trader (yet) who makes strong claims (50.5% winners would be my cutoff) and is willing to put their trades up for analysis.
Hi,

I have met a lot of traders (actual profitable traders) who have more than 60% winners.

I am maintaining a journal, trading a similar method I get around 60% winners. But lets see, any real traders knows these probabilities .5, .6 or whatever in market are not definite, only estimations.
You can see live calls here: http://www.traderslaboratory.com/for...tml#post133855
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Old 12-14-2011, 10:40 AM   #24

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Re: Trading Tip #13: How to Pick Intraday Market Direction the 80% Rule

Quote:
Originally Posted by ValueTrader »
There has been no backtesting, the 80% figure is just a historical benchmark that gets banded about by people who have read a couple of books (from 15 years ago) on MP then suddenly think they've found the holy grail.

And of course vendors, who pretend to be helping newbies but really are just interested in getting there hands on newbies cash.

By the way thought I'd post one of MY customers testimonials.

" Dear ValueTrader,
Thanks you so much for teaching me your futures secret coin toss system technique trick tip. before I subscribed to your site I was a tramp or hobo as we call them in the US. Now I trade a multi-million dollar hedge fund. Your subscripition costs were cheap, (compared to the price of a car or house) and once I'd signed up you kept 1 to 1 tuition with me via you email news letter that bombarded my inbox. Also loved the trading room...20 half wits on MSM messenger with no more experience than me, all purporting to know the direction of the market, and pretending to be successful traders. Thank you so much again VT, you must be laughing all the way to the bank. A Dolt, Utah. "

VT
Hey don't call me a half wit and there are 30 of us.
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