LBR Three Bar Triangle - NinjaTrader | futures io social day trading
futures io futures trading


LBR Three Bar Triangle
Updated: Views / Replies:9,003 / 19
Created: by aligator Attachments:3

Welcome to futures io.

(If you already have an account, login at the top of the page)

futures io is the largest futures trading community on the planet, with over 90,000 members. At futures io, our goal has always been and always will be to create a friendly, positive, forward-thinking community where members can openly share and discuss everything the world of trading has to offer. The community is one of the friendliest you will find on any subject, with members going out of their way to help others. Some of the primary differences between futures io and other trading sites revolve around the standards of our community. Those standards include a code of conduct for our members, as well as extremely high standards that govern which partners we do business with, and which products or services we recommend to our members.

At futures io, our focus is on quality education. No hype, gimmicks, or secret sauce. The truth is: trading is hard. To succeed, you need to surround yourself with the right support system, educational content, and trading mentors Ė all of which you can find on futures io, utilizing our social trading environment.

With futures io, you can find honest trading reviews on brokers, trading rooms, indicator packages, trading strategies, and much more. Our trading review process is highly moderated to ensure that only genuine users are allowed, so you donít need to worry about fake reviews.

We are fundamentally different than most other trading sites:
  • We are here to help. Just let us know what you need.
  • We work extremely hard to keep things positive in our community.
  • We do not tolerate rude behavior, trolling, or vendors advertising in posts.
  • We firmly believe in and encourage sharing. The holy grail is within you, we can help you find it.
  • We expect our members to participate and become a part of the community. Help yourself by helping others.

You'll need to register in order to view the content of the threads and start contributing to our community.  It's free and simple.

-- Big Mike, Site Administrator

Reply
 3  
 
Thread Tools Search this Thread
 

LBR Three Bar Triangle

  #11 (permalink)
Banned: Repeated promotion of vendor site in numerous posts
London
 
Futures Experience: Intermediate
Platform: Amibroker, Multicharts
Favorite Futures: ES
 
Timot's Avatar
 
Posts: 26 since May 2011
Thanks: 20 given, 8 received

The second option of coding this according to fat tails is equivalent to 8 different patterns [a or b ] and [c or d] is true when

a and c
a and d
b and c
b and d
a and b and c
a and b and d
a and c and d
b and c and d

This does not make any sense.

Reply With Quote
 
  #12 (permalink)
Elite Member
Berlin, Europe
 
Futures Experience: Advanced
Platform: NinjaTrader, MultiCharts
Broker/Data: Interactive Brokers
Favorite Futures: Keyboard
 
Fat Tails's Avatar
 
Posts: 9,651 since Mar 2010
Thanks: 4,226 given, 25,601 received
Forum Reputation: Legendary


Timot View Post
The second option of coding this according to fat tails is equivalent to 8 different patterns [a or b ] and [c or d] is true when

a and c
a and d
b and c
b and d
a and b and c
a and b and d
a and c and d
b and c and d

This does not make any sense.


Thank you for the entertainment.


The two options are logically equivalent

The first and the second options are logically equivalent. This is simple logic:

IF High[0] < Math.Max(High[1], High[ 2]) THEN High[0] < High[1] OR High[0] < High[2]

because if I High[0] >= High[1] && High[0] >= High[2], the first statement cannot be true.

The reverse is also true:

IF High[0] < High[1] OR High[0] < High[2] THEN High[0] < Math.Max(High[1], High[ 2])

which follows from High[1] < Math.Max(High[1], High[ 2]) and High[2] < Math.Max(High[1], High[ 2]) and the transitivity of "is smaller than".


The individual conditions are not stochastically independent

Also you mention eight different patterns that are possible with the expression. You forgot one, there are nine patterns, in detail :

a + (NOT b) + c + (NOT d)
a + (NOT b) + (NOT c) + d
(NOT a) + b + c + (NOT d)
(NOT a) + b + (NOT c) + d
a + b + c + (NOT d)
a + b + (NOT c) + d
a + (NOT B) + c +d
(NOT a) + b + c + d
a + b + c + d

And these 7 patterns would not qualify:

(NOT a) + (NOT b) + c + d
(NOT a) + (NOT b) + c + NOT(d)
(NOT a) + (NOT b) + (NOT c) + d
a + b + (NOT c) + NOT(d)
a + (NOT b) + (NOT c) + NOT(d)
(NOT a) + b + (NOT c) + NOT(d)
(NOT a) + (NOT b) + (NOT c) + NOT(d)

That means that out of 16 possible 3 bar patterns based on the comparison of the current bars high and low with the prior 2-bar high and prior 2-bar low, there are 9 patterns that qualify as 3-bar triangles while there are 7 patterns that do not qualify.


The probability for a 3-bar triangle is not > 50%

Now your statement that this does not make any sense is based on a heuristic interpretation of probability. If there are 9 patterns that qualify and 7 patterns that do not qualify, this does not mean that the probability for a triangle pattern is 9/16 = 56.25% !

The reason is that the 4 conditions a, b, c & d are not stochastically independent. If you know that the current bar's high is smaller than the previous bar's high, this increases the probability that the current bar's high is also smaller than the high of the bar two bars ago. Therefore the probability of High[0] < High[1] && High[0] < High[2] is smaller than the sum of the probability for the single events.

P(High[0] < High[1] && High[0] < High[2]) < P(High[0] < High[1]) + P(High[0] < High[2])


If you don't believe it, just build a little indicator and mark all triangles on the chart.


Last edited by Fat Tails; June 26th, 2013 at 01:45 PM.
Reply With Quote
The following 2 users say Thank You to Fat Tails for this post:
 
  #13 (permalink)
Elite Member
Berlin, Europe
 
Futures Experience: Advanced
Platform: NinjaTrader, MultiCharts
Broker/Data: Interactive Brokers
Favorite Futures: Keyboard
 
Fat Tails's Avatar
 
Posts: 9,651 since Mar 2010
Thanks: 4,226 given, 25,601 received
Forum Reputation: Legendary


And here is some more fun, comparing LBR triangles to Toby Crabels NR7 and IBNR4 bars.

Today's regular session for ES 09-13 has so far produced 80 price bars. Out of these

- 2 bars are inside bar narrow range 4 bars (these are always LBR triangles)
- 3 bars are narrow range 7 bars
- 3 bars are inside bar narrow range 7 bars (these are always LBR triangles)
- 13 bars are triangles (16.25%)


Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).

Reply With Quote
The following 6 users say Thank You to Fat Tails for this post:
 
  #14 (permalink)
Banned: Repeated promotion of vendor site in numerous posts
London
 
Futures Experience: Intermediate
Platform: Amibroker, Multicharts
Favorite Futures: ES
 
Timot's Avatar
 
Posts: 26 since May 2011
Thanks: 20 given, 8 received


Fat Tails View Post
Thank you for the entertainment.

Why do you think I intended to entertain you. As you discovered yourself I awaken you.


Fat Tails View Post

Also you mention eight different patterns that are possible with the expression. You forgot one, there are nine patterns,

yes, I did, the obvious one, a and b and c and d

And you went to far to assume what I was thinking. What I meant is that it is impossible for a pattern like this to have a positive expectation in any market other than when showing isolated selections of it. Just backtest it in a portfolio and look at the results.

Reply With Quote
The following user says Thank You to Timot for this post:
 
  #15 (permalink)
Elite Member
Berlin, Europe
 
Futures Experience: Advanced
Platform: NinjaTrader, MultiCharts
Broker/Data: Interactive Brokers
Favorite Futures: Keyboard
 
Fat Tails's Avatar
 
Posts: 9,651 since Mar 2010
Thanks: 4,226 given, 25,601 received
Forum Reputation: Legendary


Timot View Post
Why do you think I intended to entertain you. As you discovered yourself I awaken you.



yes, I did, the obvious one, a and b and c and d

And you went to far to assume what I was thinking. What I meant is that it is impossible for a pattern like this to have a positive expectation in any market other than when showing isolated selections of it. Just backtest it in a portfolio and look at the results.

I agree that the pattern alone cannot be profitable. LBR suggests to limit the (average true) range of the last bar and add the requirement for a low ADX reading. But their relative frequence would not invalidate 3-bar triangles as an element for a setup.

Reply With Quote
The following 3 users say Thank You to Fat Tails for this post:
 
  #16 (permalink)
 Vendor: www.probabletrades.com 
OC, California, USA
 
Futures Experience: Advanced
Platform: IB/TWS, NinjaTrader, thinkorswim
Favorite Futures: stocks, options, futures, VIX
 
shodson's Avatar
 
Posts: 1,859 since Jun 2009
Thanks: 480 given, 3,254 received


Timot View Post
Why do you think I intended to entertain you. As you discovered yourself I awaken you.



yes, I did, the obvious one, a and b and c and d

And you went to far to assume what I was thinking. What I meant is that it is impossible for a pattern like this to have a positive expectation in any market other than when showing isolated selections of it. Just backtest it in a portfolio and look at the results.

No need to explain all DeMorganian equivalencies here, the matter is settled I think...

Reply With Quote
 
  #17 (permalink)
Banned: Repeated promotion of vendor site in numerous posts
London
 
Futures Experience: Intermediate
Platform: Amibroker, Multicharts
Favorite Futures: ES
 
Timot's Avatar
 
Posts: 26 since May 2011
Thanks: 20 given, 8 received


shodson View Post
No need to explain all DeMorganian equivalencies here, the matter is settled I think...

The matter concerns whether some arbitrarily selected pattern by some author has merit, especially when no backtesting results are presented but just hand waving arguments of adding some other filter and some other indicator. These are things someone reads in books written in the 1980s. This is internet and Twitter age. Anyone trying to figure out how to trade using such absurd constructs is doomed. This is the matter of importance, not whether I missed one possible variation of the pattern. All of the Boolean logic will be of no help to you if you do not know what the premises are.

Reply With Quote
 
  #18 (permalink)
Elite Member
Berlin, Europe
 
Futures Experience: Advanced
Platform: NinjaTrader, MultiCharts
Broker/Data: Interactive Brokers
Favorite Futures: Keyboard
 
Fat Tails's Avatar
 
Posts: 9,651 since Mar 2010
Thanks: 4,226 given, 25,601 received
Forum Reputation: Legendary


Timot View Post
The matter concerns whether some arbitrarily selected pattern by some author has merit, especially when no backtesting results are presented but just hand waving arguments of adding some other filter and some other indicator. These are things someone reads in books written in the 1980s. This is internet and Twitter age. Anyone trying to figure out how to trade using such absurd constructs is doomed. This is the matter of importance, not whether I missed one possible variation of the pattern. All of the Boolean logic will be of no help to you if you do not know what the premises are.

We agree that a single, simple pattern will not make a trader rich. But a triangle has a meaning, it might point to a consolidation and reduced volatility. It is not a bad idea to detect consolidations and low volatility conditions, as this increases the probability for a larger move to follow.

Of course this is also true for ascending, descending or symmetrical triangles or for other well know consolidation patterns such as flags and pennants. Therefore I would not reject to use such tools as filters to keep me out of high volatility (high risk) trades, when entering a position.

Reply With Quote
The following 3 users say Thank You to Fat Tails for this post:
 
  #19 (permalink)
Banned: trolling
NYC + NY / USA
 
Futures Experience: Advanced
Platform: "I trade, therefore, I AM!"; Theme Song: "Atomic Dog!"
Favorite Futures: EMD, 6J, ZB
 
kronie's Avatar
 
Posts: 798 since Oct 2009
Thanks: 216 given, 498 received

@fattails

is there an "ana" version of these triangles?

how does one set up such, so as to see these triangles?

Reply With Quote
 
  #20 (permalink)
Elite Member
Berlin, Europe
 
Futures Experience: Advanced
Platform: NinjaTrader, MultiCharts
Broker/Data: Interactive Brokers
Favorite Futures: Keyboard
 
Fat Tails's Avatar
 
Posts: 9,651 since Mar 2010
Thanks: 4,226 given, 25,601 received
Forum Reputation: Legendary



kronie View Post
@fattails

is there an "ana" version of these triangles?

how does one set up such, so as to see these triangles?


@kronie: Yes, I have meanwhile published an anaVersion of the triangles. It is available here:

https://futures.io/download/ninjatrader-7/indicators/1450-download.html?view


The indicator allows to display various patterns as described by Toby Crabel in his book "DayTrading with Short Term Price Patterns and Opening Range Breakout", and you can also display the triangles as described by Linda Bradford Raschke.

To display the triangles please set

Drawing method = Detail
Display three bar triangles = true

also see chart attached.

Please register on futures.io to view futures trading content such as post attachment(s), image(s), and screenshot(s).

Reply With Quote
The following 9 users say Thank You to Fat Tails for this post:

Reply



futures io > > > > LBR Three Bar Triangle

Thread Tools Search this Thread
Search this Thread:

Advanced Search



Upcoming Webinars and Events (4:30PM ET unless noted)

Linda Bradford Raschke: Reading The Tape

Elite only

Adam Grimes: TBA

Elite only

NinjaTrader: TBA

January

Ran Aroussi: TBA

Elite only
     

Similar Threads
Thread Thread Starter Forum Replies Last Post
LBR 3/10/16 oscillator and SMR indicators ostadler Platforms and Indicators 3 February 24th, 2015 02:50 AM
How to step forward bar by bar (F12) with full bar not half bar? mercyman MetaTrader 1 October 23rd, 2012 05:49 PM
Triangle Breakout in Uptrend Saroj Traders Hideout 1 June 9th, 2012 04:15 AM
How to play an ascending triangle? rocky5 Emini Index Futures Trading 6 April 13th, 2012 04:27 PM
Playing Divergence with a Triangle aligator Traders Hideout 22 February 5th, 2012 01:51 AM


All times are GMT -4. The time now is 01:57 AM.

Copyright © 2017 by futures io, s.a., Av Ricardo J. Alfaro, Century Tower, Panama, +507 833-9432, info@futures.io
All information is for educational use only and is not investment advice.
There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.
no new posts
Page generated 2017-12-13 in 0.15 seconds with 40 queries on phoenix via your IP 54.92.201.232