Dump it Here

[Skate]

Skate,
How did you get your lipstick version to turn off so quickly? I am not that presumptuous to expect an exact answer with settings etc. Is at an market filter or extreme tightening stops etc? is all I would like to know.

@investtrader my "stale stop" predictor helps in obtaining a sharper (quicker) exit that forms part of my overall exit strategy. The secret of the "Stale Stop" exit is that all indicator measures "bar-by-bar". Doing it this way, it's easy to measure momentum or lack thereof of. Also, the "Stale Stop Exit" is time driven. Marry the stale stop with an "UlcerUp" Indicator & wham-bam-thank-you-mam the exit is as sharp as I can get it.

Recently, I was listening to one of Nick's podcast
During one of Nick's podcasts, he remarked that a time-driven exit stifles the profitability of a strategy which is in disagreement with my research. I should also say the performance increase is from having "additional buy conditions" before someone asks.

Qualifying signals
Sure a 20-period breakout strategy is fine & those signals come along with great regularity but these breakouts needs to be qualified. Not all signals are of the same quality, some are stronger than others. Being choosy about which signals you take & which you elect to pass on can make or break any strategy, not only this one

You need indicators to know what's going on
I have made a stack of posts about my "Ulcer Index Indicator", & my "Bullish Indicator" that forms part of my version of the WTT buy condition. I should also say the strategy incorporates an Index Buy Filter. I've also made a few posts on a variety of filter that keeps you on the right side of trading.

Skate.

 

[investtrader]

@investtrader my "stale stop" predictor helps in obtaining a sharper (quicker) exit that forms part of my overall exit strategy. The secret of the "Stale Stop" exit is that all indicator measures "bar-by-bar". Doing it this way, it's easy to measure momentum or lack thereof of. Also, the "Stale Stop Exit" is time driven. Marry the stale stop with an "UlcerUp" Indicator & wham-bam-thank-you-mam the exit is as sharp as I can get it.

Recently, I was listening to one of Nick's podcast
During one of Nick's podcasts, he remarked that a time-driven exit stifles the profitability of a strategy which is in disagreement with my research. I should also say the performance increase is from having "additional buy conditions" before someone asks.

Qualifying signals
Sure a 20-period breakout strategy is fine & those signals come along with great regularity but these breakouts needs to be qualified. Not all signals are of the same quality, some are stronger than others. Being choosy about which signals you take & which you elect to pass on can make or break any strategy, not only this one

You need indicators to know what's going on
I have made a stack of posts about my "Ulcer Index Indicator", & my "Bullish Indicator" that forms part of my version of the WTT buy condition. I should also say the strategy incorporates an Index Buy Filter. I've also made a few posts on a variety of filter that keeps you on the right side of trading.

Skate.

Thanks for the explanation. I'll look up your comments on the Ulcer Index Indicator, though I think I read your posts at the time and couldn't really grasp it.
Qualifying signals
Absolutely agree with this 100%. There is always a line though in curve fitting and finding the middle ground to give enough reliable signals.
Thanks again.

 

[investtrader]

Following on from my question re market timing. I am sure I read about a 4% down day to exit the market ( was it Zweig?). Anyway, in March 2022 it would have saved your bacon. There is another signal recently. Ominously in Jan 2018 there was another signal before the long decline. I coded the percent weekly change as an indicator.
I haven't tried yet to incorporate in a trading strategy but it looks interesting.

 

[Skate]

Following on from my question re market timing. I am sure I read about a 4% down day to exit the market ( was it Zweig?). Anyway, in March 2022 it would have saved your bacon. There is another signal recently. Ominously in Jan 2018 there was another signal before the long decline. I coded the percent weekly change as an indicator.
I haven't tried yet to incorporate in a trading strategy but it looks interesting.

@investtrader I don't want to stop you from looking into any alternative exit strategy but what you have described, my research of this exit, (which I should say was done some time ago) unfortunately "I don't share the same enthusiasm" as you do.

Anyway, in March 2022 it would have saved your bacon.

The "Lipstick on a Pig Strategy"
I like your clever analogy of saving my "bacon" when referencing the "Lipstick on a Pig Strategy". If you study the chart below for March 2022 the protection was already in place.



Summary
I should also give credit to @rnr. Rob has previously made a great post on this exit, that is recommended for you to read.

Find it here

Amibroker 20 percent flipper strategy

Hi everyone, I have just started to learn and look into Amibroker to create a trading strategy that would suit me. I have read about the "20% flipper" strategy that sends a buy signal when a stock has bounced off a low by moving 20%. I don't know how to write this in AFL language so I am...

www.aussiestockforums.com

A more detailed description can be found here

Zweig

Skate.

 

[investtrader]

Okay, thanks for the heads up. I did notice that you were out really. Here is the equity curve for that period for my best system. Caveat - I wasn't trading this then and it is a big improvement on what I have been doing for many years. I did crap over this period, but also stopped and started trading for a few years as I was tied up with other life stuff.

 

[investtrader]

So my drawdown was 17%. I am currently in a 17% drawdown now. But I figure that is the price to pay for bigger returns. 17% is actually a bit depressing if you look at the $. Nick Radges twitter posts kinda make you feel better though.
No more posts for now. Killing some time as I get over COVID and stuck at home.

 

[Skate]

Killing some time as I get over COVID and stuck at home.

@investtrader, I realise that Covid affects everyone differently & I'm sure I speak for everyone in the "Dump it here" community wishing you a speedy recovery.

Okay, thanks for the heads up. I did notice that you were out really. Here is the equity curve for that period for my best system. Caveat - I wasn't trading this then and it is a big improvement on what I have been doing for many years. I did crap over this period, but also stopped and started trading for a few years as I was tied up with other life stuff.

Yes, drawdowns do scare us all
I can see that your system exited during this period. If you compare both exits (mine & yours) you will notice that I've exited a little sooner. Sharpening the exit will be a worthwhile exercise. If you read enough of my posts you will notice a theme of me constantly banging on about exits, as exits are where you make the money. Entries are a dime-a-dozen.

Sjkate.

 

[investtrader]

Thanks for the well wishes, Skate. COVID knocked me around a bit for 4 days. Wouldn't like to be unvaxxed and get it.

Actually I give you credit for improving my exits, as your thoughts over the last few years have challenged my thinking. For this system I use a profit target, an overbought type exit to catch extreme moves, trailing stop and market type exit( not that sensitive). No stale exit though.
My entries are also a lot earlier than I used to trade, so lot of smaller losses.

 

[Newt]

I was looking for a new project
Heck, I am mighty impressed with the backtest results so. The pig & I are seeing Dollars.

This strategy could have legs
It might just need a few minor adjustments to get the "Lipstick" in the correct position.

I should check with @Newt where to put the lipstick
Then again, I don't think the position would make much of a difference.

Skate.

I really should declare that "lipstick on a pig" was not my own but borrowed. I can't find a link now, but 90% certain it was from a Better System Trader (or possibly Chat with Traders) podcast about the many dangers of over-improving basic trend trading logic. The essence was be careful about degrees and freedom and extra variables and code added to improve. The first one or two may well help, but iterative lipstick is likely to be very very bad.....

My Photoshop skills are appalling, but you get the idea.....

 

[ducati916]

Not really my thing, but maybe for someone:

Study and Backtest Of All 75 Candlesticks – Which One Works And Which One Is Best? - QuantifiedStrategies.com

We have yet to see much quantified backtest of candlestick patterns. Practically all candlestick "analysis" is based on anecdotal evidence and some random

www.quantifiedstrategies.com

jog on
duc

 

[Skate]

Not really my thing, but maybe for someone:

Study and Backtest Of All 75 Candlesticks – Which One Works And Which One Is Best? - QuantifiedStrategies.com

We have yet to see much quantified backtest of candlestick patterns. Practically all candlestick "analysis" is based on anecdotal evidence and some random

www.quantifiedstrategies.com

jog on
duc

Which Candlestick Patterns Actually Works And Which One Is Best?​

For $1,165 AUD you can purchase the Candlestick Patterns with historical backtests and performance + Amibroker code.

I’ll pass at this stage
Back in 2015 I read a book called “ Candlestick Patterns” it was around 700 pages, & a heavy read. To understand the book it took me about 3 weeks & many more weeks researching to qualifying if they could be useful in my trading . There was none that I found that gave consistent enough results to use.

Skate.

 

[Skate]

I was out of the office when I made the last post
So there is no doubt, don't waste your money on buying the "Amibroker" code that is freely available on the web. I spent 3 months of my life studying Japanese Candlesticks patterns (3 months of my life I’ll never get back BTW) only to find out that Candlesticks patterns "do repeat consistently" & work well "sometimes", whereas other times they don’t.

As with trading
Japanese Candlesticks reading is not an exact science & it falls into the category of personal interpretation.

Hidden meaning
You tend to interpret the hidden meaning of the Candlestick in your particular way, sometimes you tend to see what you want to see & most times interpret the pattern as favourable which can lead you to take s trade with confidence.

Skate.

 

[Skate]

Some Books are time thieves
I wasted a lot of time reading many books over the years & each of those books takes a fair amount of time to read & much more time to understand what you have just read.

Reading a book & ticking it off, rarely works
To be perfectly honest, most of the books I've read have turned out to be of little value "to me". I've wasted so much of my time reading books I wonder if it was really worth it. The two books below fall into this category as well.

1. JAPANESE CANDLESTICK CHARTING TECHNIQUES
A Contemporary Guide to the Ancient Investment Techniques of the Far East, by STEVE NISON

2. PROFITABLE CANDLESTICK TRADING
Pinpointing Market Opportunities to Maximize Profits, by Stephen Bigalow

Skate.

 

[Skate]

Candlestick Pattern Training Course
I should also say that have completed a full 2-day podcast training course with Steve Nison that turned out to be a complete waste of my time. During the course, Steve couldn't even answer some of the questions put to him. But one thing I did learn, Candlestick Patterns are not to be trusted. Why, because they "don't always work".

From my perspective
Understanding "candlestick pattern setups" didn't enrich my trading life because they just didn't work for me. From my research, I should say "extensive research" & from personal experience, not one strategy was successful in making money on a "consistent" basis.

Don't spend the money
I could have said that in my first post, but I had to get a few things off my chest.

Skate.

 

[DaveTrade]

I wasted a lot of time reading many books over the years & each of those books takes a fair amount of time to read & much more time to understand what you have just read.

My personal experience is that I gained more wisdom to be able to determine what works and what doesn't which has helped me going forward in my journey. But it's been a long journey.

 

[DrBourse]

Candlestick Pattern Training Course
I should also say that have completed a full 2-day podcast training course with Steve Nison that turned out to be a complete waste of my time. During the course, Steve couldn't even answer some of the questions put to him. But one thing I did learn, Candlestick Patterns are not to be trusted. Why, because they "don't always work".

From my perspective
Understanding "candlestick pattern setups" didn't enrich my trading life because they just didn't work for me. From my research, I should say "extensive research" & from personal experience, not one strategy was successful in making money on a "consistent" basis.

Don't spend the money
I could have said that in my first post, but I had to get a few things off my chest.

Skate.

Hi Skate,



Sorry M8 but I have to challenge you on your Candlesticks Posts.

I’m only posting the following with Newbies in mind – they deserve a contra view.



To be fair M8 I feel you are a little harsh in your condemnation of Candlesticks.

I may be wrong, but I presume from your recent posts, that you used, or referred to “Amni Broker along with extensive research” to base your comments on – Using some experts formulas from within a Software Program is fraught with danger – you are presuming that the software formulas are written by someone that you hope understands Candlesticks, and that those formulas somehow produce the correct & desired results – huge mistake IMO.

Brokers, Merchant Bankers etc do not solely rely on a Software Based Candlestick Program signals to make decisions, they might, as I do, use them as something worth investigating.

Not really sure if the Mathematicians of this world have come up with the ultimate Candlesticks Software Program yet.

Over the years I have bought various Software programs that claim to have accurate Candlestick predictions, at one stage many years ago I compared 5 such programs – every time, on every scan they would produce 5 different results, hence I don’t use any of them in my daily research, the one that I do use, purely as a lead in for in depth Candlestick analysis, is “Trading View”.

Anyhow, nobody should use just Candlesticks to trade with.

Candlesticks should only form a Small Part of anyone’s TA, to be more precise, IMO, Candlesticks should rate at about 4% or 5% at best of anyone’s TA Tools.

For most TA Types, Candlestick Construction, Candlestick Addition, Candlestick Patterns, Candlestick Formations, along with - Indicators, Waves, Fibb’s, ABC’s, along with Several different Charts like P&F, etc, and a dozen other TA Tools (total of about 20) should all be used to help form an individual’s TA Arsenal.



Even then TA should, at best, only form a Max 40% of a TA Traders decision making process.

I’ve helped thousands of newbies (yourself included) over many years, they have all eventually understood how to include Candlesticks in their decision making.



I feel your condemnation should be directed to Amni Broker & other Black Box Formulas within Some Software Trading Programs – Not towards Candlesticks in general.

I might also point out that most aspects of this Share Trading Profession "Don't always work" the way we want them to.

This post will probably attract a lot of uneducated and negative comments, which is usual for me, and it will probably get me banned.

I will return to my cave now.

 

[qldfrog]

Hi Skate,



Sorry M8 but I have to challenge you on your Candlesticks Posts.

I’m only posting the following with Newbies in mind – they deserve a contra view.



To be fair M8 I feel you are a little harsh in your condemnation of Candlesticks.

I may be wrong, but I presume from your recent posts, that you used, or referred to “Amni Broker along with extensive research” to base your comments on – Using some experts formulas from within a Software Program is fraught with danger – you are presuming that the software formulas are written by someone that you hope understands Candlesticks, and that those formulas somehow produce the correct & desired results – huge mistake IMO.

Brokers, Merchant Bankers etc do not solely rely on a Software Based Candlestick Program signals to make decisions, they might, as I do, use them as something worth investigating.

Not really sure if the Mathematicians of this world have come up with the ultimate Candlesticks Software Program yet.

Over the years I have bought various Software programs that claim to have accurate Candlestick predictions, at one stage many years ago I compared 5 such programs – every time, on every scan they would produce 5 different results, hence I don’t use any of them in my daily research, the one that I do use, purely as a lead in for in depth Candlestick analysis, is “Trading View”.

Anyhow, nobody should use just Candlesticks to trade with.

Candlesticks should only form a Small Part of anyone’s TA, to be more precise, IMO, Candlesticks should rate at about 4% or 5% at best of anyone’s TA Tools.

For most TA Types, Candlestick Construction, Candlestick Addition, Candlestick Patterns, Candlestick Formations, along with - Indicators, Waves, Fibb’s, ABC’s, along with Several different Charts like P&F, etc, and a dozen other TA Tools (total of about 20) should all be used to help form an individual’s TA Arsenal.



Even then TA should, at best, only form a Max 40% of a TA Traders decision making process.

I’ve helped thousands of newbies (yourself included) over many years, they have all eventually understood how to include Candlesticks in their decision making.



I feel your condemnation should be directed to Amni Broker & other Black Box Formulas within Some Software Trading Programs – Not towards Candlesticks in general.

I might also point out that most aspects of this Share Trading Profession "Don't always work" the way we want them to.

This post will probably attract a lot of uneducated and negative comments, which is usual for me, and it will probably get me banned.

I will return to my cave now.

I will just say that knowing mr Skate, I doubt he used a black box implementation on Amibroker..and so after programming the candle stick systems of interest , ended with the view that on his realm, in the time frequency and the period he ran his simulations, he could not find any statistically significant advantage.
I am sure @Skate can develop further.
And Dr Bourse, you are very welcome with different opinions ?

 

[Skate]

Sorry M8 but I have to challenge you on your Candlesticks Posts. Not really sure if the Mathematicians of this world have come up with the ultimate Candlesticks Software Program yet. Over the years I have bought various Software programs that claim to have accurate Candlestick predictions, at one stage many years ago I compared 5 such programs – every time, on every scan they would produce 5 different results, hence I don’t use any of them in my daily research. Anyhow, nobody should use just Candlesticks to trade with. Candlesticks should rate at about 4% or 5% at best of anyone’s TA Tools.

@DrBourse, your post, by the way, is a well-articulated article that's not a challenge in any way. Reading an alternative view is one of the great features of this thread. I've condensed your post (quoted above) in the hope others will take the time to read it as it confirms what I was saying.

Candlestick Patterns didn't work for "me"
When it comes to relying on "Candlestick Patterns" to trade systemically. I made the remark that "I was unable" to get the Candlestick Patterns to produce consistent returns after extensive research & coding. It's not hard to code Candlestick Patterns but I've found they rarely work in isolation or as an indicator.

Technical Analysis
I'm sure those who possess certain skills such as yourself could take advantage of Candlestick Patterns but I doubt in isolation. I'm first to admit, that I've learned a lot from the generous material you have supplied me over the years. I also recommend your educational material to everyone.

To reiterate
There was none that "I" found that gave consistent enough results for "me" to use.
Understanding candlestick pattern setups didn't enrich "my" trading life because they just didn't work for "me".

For those who want to know more
Thomas Bulkowski presents Candlestick Patterns with statistics, of the top 5 Candlestick Patterns (IHO) which you can apply to your existing trading strategy or form a trading strategy. Thomas Bulkowski in his short YouTube video explains the probability & reliability of using Candlestick Patterns in trading. After watching his video go to his site (hyperlink below) & it will give you another perspective on Candlestick patterns, which I highly recommend.



Chart Patterns
Thomas Bulkowski is one of the world's leading authorities on chart patterns. He is a successful investor and trader with almost forty years of market experience. This means he knows his stuff.

ThePatternSite.com

ThePatternSite.com is internationally known author and trader Thomas Bulkowski's FREE website for research on chart patterns, candlesticks, and much more!

thepatternsite.com

Skate, after programming the candle stick systems ended with the view that he could not find any statistically significant advantage.

Summary - from my perspective
@qldfrog, yes you are correct when you said "I couldn't find any statistically significant advantage" & it wasn't for the lack of trying. To reiterate, from "my" extensive research & "personal experience", not one strategy was successful in making money on a consistent basis. But in saying this, I'm sure there are some who swear by "Candlestick Patterns" & their perceived value, but it's not for "me".

Skate.

 

[investtrader]

DrBourse posted -

I’m only posting the following with Newbies in mind – they deserve a contra view.

For most TA Types, Candlestick Construction, Candlestick Addition, Candlestick Patterns, Candlestick Formations, along with - Indicators, Waves, Fibb’s, ABC’s, along with Several different Charts like P&F, etc, and a dozen other TA Tools (total of about 20) should all be used to help form an individual’s TA Arsenal.

I think this is completely bad advice for newbies, or anyone for that matter. The great traders don't do all of this stuff, IMHO. The actual price action is all you need, with a couple of basic indicators. Look at Guppy's work, he is the real deal. Or Minervini. No 'magical' Elliott waves or Fibonacci's needed.

 

[DaveTrade]

DrBourse posted -

I’m only posting the following with Newbies in mind – they deserve a contra view.

For most TA Types, Candlestick Construction, Candlestick Addition, Candlestick Patterns, Candlestick Formations, along with - Indicators, Waves, Fibb’s, ABC’s, along with Several different Charts like P&F, etc, and a dozen other TA Tools (total of about 20) should all be used to help form an individual’s TA Arsenal.

I think this is completely bad advice for newbies, or anyone for that matter. The great traders don't do all of this stuff, IMHO. The actual price action is all you need, with a couple of basic indicators. Look at Guppy's work, he is the real deal. Or Minervini. No 'magical' Elliott waves or Fibonacci's needed.

I agree that if you use candlesticks then you need a couple of indicators with them, and my interpretation of what DrBourse said was exactly the same thing. His list of choices was not well chosen IMO, eg no way that P&P goes with candlesticks.