Eszter's EOT based journal - from SIM to real trading
As soon as I stopped suffering with ES, dared to think and built up my own strategy started to be consistently green.
After 3 profitable months with Gold on SIM it is time to think about stop simming and do real trading. But when I was thinking about this option, realized, that Gold might be too fast and too scary if it is about real money. GC is often similar to a machine gun, and in most of the time I had no chance to think about an exit startegy when loosing, the only possible exit was a stopout. Three stopouts in a row is quite normal with gold, which is -840$ with my 14 ticks stop and 2 contracts.
This is why I changed to euro that seems to trend nicely, but with less speed. There is time to think and no challenge to my fingers and reflex.
The chart I trade is a 6 range 6E chart.
My overview charts are 5 min. and 12 range, the primary trading time is 9:30 to 11:30 EST. Besides this I try European mornings and US premarket after 7 or 8 EST.
I use EOT indicators.
1. The arrow is a complex of price, cycle and volume based indicators - this is my primary signal. (The % shows the EOT NCEP version - arrows run through a neural network, but currently I don't use this function - some comments about later.)
2. I filter the arrows with the red-green line on the chart - this is a volume indicator and the magenta-cyan line, based only on price, similar to Sharky's step MA. The paintbar function contains these 2 indicators - red bar when the volume is red and step MA is magenta, green when the volume is green and MA is magenta. Redundant information, but an extra visual help.
3. The next filter is the yellow line - Alla's average (I found it in some posts of Mike) - a trend filter, MA of the price highs and lows, see the small pinkish dots above the candles. Below only shorts, above only longs should be taken.
4. In the subwindows put bidask volume and a volume splitter adjusted to 1, which means it is also a kind of bidask volume. I need only one of them - will test both for a couple of days to decide which one. Probably the volume splitter will be replaced with a delta indicator. I watch GomCD, GOMDeltaVolume and RJay's staff on another chart.
5. Arrows are adjusted to plot only within 22 ticks from the next high or low (pinksh dot). This doesn't mean that I always take the trade within 22 ticks, it depends on the price action between the high/low and the signal bar also, but this is the maximum distance.
As for indicators, obviously volume got more emphasis on my chart than price. I think that price itself is a great price indicator, and if I have one more price indicator (built in in the arrows) that is enough.
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Besides the trading chart I test
- EOT NCEP filtered only with probability % on 6E, the chart shows signals above 57% probability,
- and another, extremely simple trend trading system I call sys2.
I have to mention that sys2 is not my idea, the basic concept and also the 2 indicators used are from Richard (movethemarkets)
The blue line on the chart is an EMA (the Holt method of trend-corrected exponential smoothing),
the cyan-magenta line is the step MA-like Price Proxy I use also on my trading chart.
1. The blue EMA should obviously trend up or down (I decide by watching, but a slope counter would be helpful).
2. Price Proxy should follow the trend direction (long cyan, short magenta).
3. When price crosses the EMA at least 3/4 of a bar , i.e. 4 ticks in case of a 6 range chart (pullback in the trend), the first bar that closes in the direction of the trend, is a signal bar to enter ... of course in the directon of the trend.
And that is all.
I test sys2 on GC 8 range and 6E 6 range and use my normal money management: 14 ticks stop on gold, 9 ticks stop on 6E and a trailing startegy. But I think this should be overthought and chagned to profit the most from these trades.
Today's sys2 result:
- no trades from 3am to 5:30 am
- GC 2 winners from 9:30 to 11:30
- 6E 2 winners (small winners with my trailing) from 9:30 to 11:30
I don't take NCEP and sys2 trades, just mark them on the charts.
And the trades I really took following the previous post's rules
- in European morning I had no trading signals (a nice trend started as soon as I stopped)
- in US morning I had 2 winners 7+4 ticks with 1 contract
I jumped out of the 2nd trade, because volume went against me, and what is worse Obama started to talk. I really can't decide wheather it was a wise precaution or it was a stupid decision. (With hindsight - seeing the price to fall down - it was stupid.)
My charts show GMT -1 time, but I usually write the EST time on them.
Last edited by Eszter; February 17th, 2010 at 04:32 PM.
Dragon, thank you for your interest. To be honest currently I don't use NCEP, I just test it, make jpeg-s and statistics, want to figure out how I can integrate it in my trading system.
And I am waiting for NCEP 2 that probably comes out at the end of this month to see how it improves.
NCEP has 2 parts
- the arrows that is a complex of price, volume and cycle indicators - this is not new, we have it for a while, but was improved several times
- and the newest EOT development: the arrows are revised by/run through a neural network based on 10 years data that gives % to the arrows;
the 3 percentages tell us what is the chance of reaching the 1st, 2nd and 3rd target in a given entry setup (the targets are precalculated, not my choice)
In principle this gives the opportunity to filter the arrows only with
(futures.io (formerly BMT) envelope and other lines on my charts are not part of NCEP.)
I personally use the arrows only and filter them with other first of all
directional staff and volume.
I posted a 11 rage Gold chart and a 6 range Euro chart. The text x winners y losers represent my money management with a trailing stop, which might not be the best way to trade these arrows. Everybody can judge by the pictures how the arrows would work for him or her.
Gold % filter is 58%, the system shows only the arrows with higher than 58% chance to reach the first target, euro fitler is 57%.
Last edited by Eszter; February 22nd, 2010 at 03:11 PM.
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1. my strategy on 6E 6 range - take the trades with 1 contract and trailing stop
2. my strategy on GC 8 range
3. sys2 on 6E 6 range 4. sys2 on on GC 8 range - take the trades with 1 contract and trailing stop
5. NCEP on on 6E 6 range
6. NCEP on GC 11 range
Euro didn't give too much chance today in the US time, it literally stopped.
Was it a mistake to take the trade in an extremely slow market? Or this is the way to follow my plan and strategy? The bottom line: -8 ticks
Gold is my baby. 4 winners, 1 questionable trade, let say loser.
3. euro sys2
No trend, no sys2 trade.
4. gold sys2
3 trading setup. The 2nd didn't look reasonable, the 3rd I didn't notice real time. +4 ticks
4. NCEP euro
2 winners resulting in 5 ticks with my trailing.
5. NCEP gold
NCEP gold on 11 range is a new staff and seems to work.
But this chart demonstrates my feeling: the current NCEP supports more countertrend trading than trend trading.
Alltogether loosing day.
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Hi eszter thank you for your post about the NCEP iam thinking of getting to trade the ES with.just a question what type of stops do you use for the ES do you use the system price chanels to determine stop?
There is no price channels to determine the stops.
Everybody puts the stop according to his exact trading plan, but the 2 main methods are
- either to use a 6-tick hard stop for the 4 range ES chart,
- or to put the stop 2 ticks below the previous low/above the previous high or if it would be more than 12 ticks than use a 12 ticks hard stop or not to take the trade.
Next week is free trial in the EOT chatroom if you are interested.
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