Dump it Here

[Skate]

Hello Skate,
None of what I use is based on Ehlers work or indicators. This is something that I have been working on for 15 years originally based on the work of Hurst and James Maggio and has undergone a lot of trial and error. As mentioned to a reply in another thread about repainting. One indicator does not at all, the other does a small percentage of the time and by with a negligible change in the curve as proved in a historical graph. Any indicator based on closing price repaints assuming price is changing and until that bar is almost complete. For me an indi that repaints a small % of the time but keeps you in the right side most of the time, far outweighs a useless lagging indicator that does not repaint.

Further to last post. This morning a buy was signaled on the AUS200 off the 3h chart. These trades always taken and not knowing if this a counter trend or not initial TP(50%) is set at value of 3hr 20 EMA of 14ATR at time of trade and SL moved to BE for the rest. SL set to 1.5X ATR. To understand if this move will be anything more sustained I consult the daily Trend Indicator which at the moment has not crossed above -100 as such the trend is still assumed down. A cross above -100 can only be generated by higher prices or wait till tomorrows opening to confirm and check again.

@gartley, where have you been? Your recent posts are so informative with educational value that is very close to my current thinking about system coding (I'm very impressed). It's taken me a few years to accept that successful traders are not perfectionists knowing we all have losing trades, that's why money management, stop losses & indicators (tools) are so important.

Indicators
Our species use indicators (more often then anyone realises) to make our next decision & trading is no different. We tend to use our "pet" indicators that gives us a high probability entering a trade at the correct time, (timing is everything in this game). The perfect trading system or approach does not exist, we all know this but Ehlers & Hurst may give us the opportunity to incorporate some new ideas to our way of thinking about the markets & market timing.

Tools
Any good trader know's that using one tool is not enough, using indicators in conjunction with each other has an ability to improve any strategy. At this point let me make a disclaimer - we all know that we shouldn't rely on the signals to be accurate all the time, just most of the time. I will be looking closely at your last post to decipher the methodology behind the charts as I believe many others will also do.

J.M. Hurst in his book "Cycle Trading without the Rocket Maths" is my next read
I have read somewhere that Hurst never actually described the mathematics behind his systems so it will be interesting to learn more. John Ehlers work dives deep into the mathematical cycles of the markets & I imagine Hurt will do much of the same as the title of his book suggests. It's quite an old book, so what was old may be new again, if you know what I mean.

Skate.

 

[Skate]

Thanks for sharing on PANDA Skate. You have no real reason to do so, other than giving to the ASF community. I had the opportunity to digest a couple of Ehler books late last year while on various flights and work trips but haven't found time/motivation to explore his ideas further. Just knowing someone has found value and parameters that work for a strategy is inspiration enough sometimes for others to push a bit harder. Who knows how much time we'll have soon for system development and backtesting.

@Newt, I have found value in Ehler ideas as his mathematical equations are clean & simple. The maths to arrive at his Deviation Scaled Moving Average Indicator (DSMA) is simply stunning to say the least. The DSMA indicator is only a few lines of code that smooths the data of an exponential moving average (EMA) that incorporates a "dynamic" smoothing coefficient that is "updated" based on the magnitude of price changes. (brilliant)

@gartley has been been fine tuning "Hurst and James Maggio" work for 15 years, something that I find stimulating & fresh. We all post in the "Dump it here" thread in the hope of "giving to the ASF community" by sharing ideas, knowledge & experience. Educational posts displays a level of caring by passing information on to others in the hope of helping, what they do with the informations depends if it engages them, without engagement "thinking on a deeper level" won't happen.

Skate.

 

[gartley]

@Newt, I have found value in Ehler ideas as his mathematical equations are clean & simple. The maths to arrive at his Deviation Scaled Moving Average Indicator (DSMA) is simply stunning to say the least. The DSMA indicator is only a few lines of code that smooths the data of an exponential moving average (EMA) that incorporates a "dynamic" smoothing coefficient that is "updated" based on the magnitude of price changes. (brilliant)

@gartley has been been fine tuning "Hurst and James Maggio" work for 15 years, something that I find stimulating & fresh. We all post in the "Dump it here" thread in the hope of "giving to the ASF community" by sharing ideas, knowledge & experience. Educational posts displays a level of caring by passing information on to others in the hope of helping, what they do with the informations depends if it engages them, without engagement "thinking on a deeper level" won't happen.

Skate.

Hello Skate, I have not come across DSMA before but what you describe sounds somewhat similar to the Kaufman Adaptive MA and possibly the Mcgingly Dynamic. Correct me if I'm wrong.
The Hurst without the rocket math book ( from tradingfives) is a simplified version of Hurst's price projection using centered moving averages and has been around for 15 years. Firstly the dominant cycle is determined in a time series and thereafter harmonics of this are chosen as periods of simple moving averages ( centered). Just as the MA's start to roll over in a turning market, straight lines are extrapolated into the future. The intersection point is then determined and the distance to price price is found and the same distance is projected to determine a price projection. It should be noted this concept of determining a price projection can only be done when price is half wa through it's cycle or swing. Hurst also used FLD's (future lines of demarcation) for the same purpose. He created these lines using 2 period MA using midpoint of bar, and then offseting this into the future. Peter Eliades ( do a youtube search) has done a lot of work with this and will soon release specialized software that dealswith this concept. His calls have been spectacular to date). Below is my version of price projection on a monthly chart of the XAO. That projection called for 4570, but has been exceeded. This not because the projection was wrong but rather because it soemtimes "loops" and is part of a bigger cycle but I have not looked at a bigger timeframe yet. These are extreme events we are dealing with in the market at the moment.....

 

[Skate]

"thinking on a deeper level"

Bankcard
If I may take a small indulgent to explain about being offered a job with Bankcard in 1986 (it was so long ago)

Background
I was a manager in a large organisation & I was tasked with overseeing the installation of "Bankcard" facilities throughout all the department of the organisation. It was a big deal back then, two weeks was allocated to install & train as Bankcard was relatively new to Australia but not in parts of Europe (today, it plug-and-play as any business owner knows).

Idol chit-chat
Looking over his shoulder making small talk I asked if "he enjoyed his job" I was shocked to find out he was a "recruitment officer" for Bankcard. Because of the high demand for Bankcard he was temporarily assigned to "installations" for a few months. One question led to other when he said "I have an exam with me" if you are interested in a position with us. Nah, I told him I already have a career path but "as I knew a lot about Bankcard" I agreed to do the exam anyway.

It was a 2 hour exam
We were in a dedicated temperature & humidity controlled computer room (remember this was back in 1986) The computer was used for data entry & had a few desks in the room. He opened his brief case & placed the exam face down on the desk. He preceded to pull out a "half pencil" & "what I thought was an old fashion fob watch" out of his brief case that turned out to be a "stopwatch". I commented that this is a bit serious.

Exam Rules
He went on to explain there are only a few rules (1) Once you start the test you are not allowed to speak for any reason (2) You have a maximum of 2 hours to complete (the time to complete the exam is critical for the evaluation of the candidate). (3) I was not to turn over the exam paper till instructed to do so. The exam paper was one sheet of A4 paper & one small pencil, my mind was racing wondering what the test would involve. To keep the post to a reasonable length so I'll break it into two parts. (to keep the interest going)

Skate.

 

[Skate]

Moreover...

The stopwatch was started
I was nervous when he said "turn over the exam, you have two hours, no talking"

I turned over the paper
I was taken aback, I thought it was going to be an exam about Bankcard. I was confident as I had done my homework, I knew the process well but it didn't prepare me for what I was looking at.

Bloody hell
There were no questions, just some funny hieroglyphics - at first I didn't understand what it all ment let alone what the answer could be. I was just about to ask a question - till I realised the reason for the "no talking" rule. When I said I was finished he said 4:52 - I thought it was the current time as it was well into the afternoon but it was a reference to the time I had taken to completed the exam "4 minutes 52 seconds" that's why I remember the time exactly.

Turning over the paper
When I turned over the exam paper this confronted me. The hieroglyphics below was "all" that was on the paper.



Skate.

 

[Skate]

Peter Eliades (do a youtube search) has done a lot of work with this and will soon release specialized software that deals with this concept. His calls have been spectacular to date).

@gartley thanks for your concise in depth answer with additional charts that raises more interest to understand your methodology. Peter Eliades appears to have credibility as his YouTube channel has 1,450 subscribers.

FYI
Peter Eliades youtube channel can be found here: https://www.youtube.com/c/stockmarketcycles

Educational references are always handy
The YouTube videos are short in duration so I'm planning to consume them all tomorrow before reading Hurst book. Thanks for the additional explanation of your trading methodology. I'm sure we'll all be scrambling to learn more to better understand.

Thanks again for your posts in the "Dump it here" thread...

Skate.

 

[qldfrog]

defeated, sought take step back, these are letters 8 for B etc,nope
then suite what is next? (in this case next triplet or just linear sequence)
or
if suite :what is the intruder?
Anyway, I would have failed
I had a quick discard at mirror, inverse etc
As I do not find the answer i reply here, obviously if you find the answer , if there is one, do not spoil it and PM @Skate
BTW, if confronted to such a test, i would not even try to do it and would just say thanks, no time for that and this type of employer

 

[Skate]

defeated, sought take step back, these are letters 8 for B etc,nope then suite what is next? (in this case next triplet or just linear sequence) or if suite :what is the intruder? Anyway, I would have failed I had a quick discard at mirror, inverse etc As I do not find the answer i reply here, obviously if you find the answer , if there is one, do not spoil it and PM @Skate BTW, if confronted to such a test, i would not even try to do it and would just say thanks, no time for that and this type of employer

@qldfrog I was told "real" candidates weren't informed if they pass the exam on-the-day but rather informed by letter a week later. He was shocked I got the answer correct, let alone so quickly. I wish I could remember his name but he remarked he was looking for people who had specialised problem solving skills.

Skate.

 

[qldfrog]

A shame, problem solving was my forte..and outside the box thinking but probably not on this quizzes

 

[Skate]

To help stop the spread of coronavirus - Wash your hands to help prevent the spread of COVID-19

Proper Hand Washing Technique
If you think you are washing your hands correctly, think again. I've been washing my hands the wrong way after watching this short 45 second video - it's a real eye opener !!

Pretend the black ink is soap!
Also don't forget to wash the tips of your fingers, thumbs & under your fingernails.



@Garpal Gumnut thanks for posting the WHO health warnings in the "Dump it here" thread.

Skate.

 

[gartley]

Yesterday, I posted a buy signal off the 3h which at the time was not confirmed as the start of a new trend off the 3h. My position is to take all trades when signalled and employ suitable money management in the process. Today with the 3 hour trend indicator above 100, the 3h trend is confirmed and remains in effect until we get a cross below 100. As long as this stays at or above 100, new longs can be initiated by a cross of the signal FT back above midline if it falls back below. The daily Trend Indicator also suggests this trend will persists with a marginal cross above -100 already in place.

 

[Skate]

Is there a beginners guide or a good read up on the net somewhere. Maybe something like the ASX explained for dummies? I have really taken a step back now after reading alo on this forum seems like alot of people lose money on the ASX and the only people that make it are the very smart investors with bucketloads of experience.

There is a lot to learn and I'm as keen as mustard would have been a bit better if I started researching 6 months ago. Its hopefully going to be a fun journey and an educational eye opener for me.

Bit of background - first time ASX investor, I'm willing to hold for 3-5 years to make a profit or even much longer, don't mind dividends either but not fussed if I invest in a no dividend paying company. Eventually I would really like to have a fair bit of money tied up in the ASX that could potentially earn me at least 50 to 60K after tax via dividend payments. I know this is no easy feat and from some rough calculations and some extremely good stock picks I'm thinking I would at least need to pick the best dividends stocks and probably have at least $800,000 invested for that kind of return.

Some beaten up large caps which have come to my attention include: ANZ, CIM, FMG, MQG, NAB, ORG, RIO, SCG, STO, WBC. Disclosure - I've recently bought some of these.

Inspiration for another post
I'm constantly amazed that some people throw thousands of dollars at the markets with zero education, money they have worked hard for only to read that in a few short years they have managed to lose most of their nest egg through investing. The reason we invest/trade is to grow our nest egg not the reverse.

Investing rather than trading
@Smurf1976 without even realising has given @bfhoon some really sound investing advice to make a profit over a 3-5 year period, opportunities like these don't come around all that often. @bfhoon has already stated: "Eventually I would really like to have a fair bit of money tied up in the ASX that could potentially earn me at least 50 to 60K after tax via dividend payments at least $800,000 invested for that kind of return" I've recently invested $800k equally in ANZ, BHP, CBA & MQG - @Smurf1976 calls them "beaten up large caps" which is a good analogy. If those 4 positions can reclaim their former glory over the next 2 years with dividends along the way they have the potential to represent a good risk/reward investment that will not only meet @bfhoon's criteria but hopefully exceed it - only time will tell.

When it comes to trading it's not a level playing field
There is no way any of us sitting at home with limited information, slow internet service, using off the shelf trading software can find better opportunities than the professional trader or the multi nationals that spends millions of dollars on research having easy access to company management. These companies employ teams of traders who have the sharpest, fastest & sometimes the most "unethical minds" in the world - "that's who you are trading against".

Summary
Investing can sometimes be a little more easier to mentally handle than trading.

Skate.

 

[Skate]

Investing can sometimes be a little more easier to mentally handle than trading.

It's worth remembering
You're up against traders who will have more experience, more information & much more money than you, so leave all your dreams of making quick and easy money behind & concentrate on your survival. Your absolute first goal should be to "learn how to stay in the game" - that's your most important job.

Successful trading
Successful trading is like getting pregnant. Everyone congratulates you when you manage it but no one asks how many times you got fu¢ked first. You need to mentally prepare yourself to accept losses & on occasions prepared to accept a few larger losses as losing is part of the trading game.

It's complicated
First off, when it comes to risk you need to find your level that you are willing to accept as an acceptable level of risk varies between individual traders. There is a difference between Trading & Investing but in both cases, evaluating whether a position represents a good level of "risk/reward" is essential.

Capturing a price trend
There is a difference between buying into great companies & investing in companies just to capture a profit from a price trend. A lot of money can be made doing both regardless of the aspects of the ongoing businesses. Traders try to capture the small price trends within a long term trend where investors "over time" hopes to capture the full price trend discarding the minor fluctuations in price along the way.

Position management is critical
Recent times highlight the importance of managing positions whether you are a trader or an investor. Without managing your positions a "Set & Forget" strategy can sometimes be fraught with danger.

Skate.

 

[investtrader]

Okay ... still waiting Skate???

 

[Skate]

Okay ... still waiting Skate???

What are you waiting for?

Skate.

 

[Skate]

Okay ... still waiting Skate???

Ok, now I understand the question.

What was the answer to the puzzle
When I turned over the exam paper I was taken back to say the least, it caught me off guard then I focused on a few things, the hieroglyphics & the pencil. When I turned over the exam paper this confronted me. The hieroglyphics below was "all" that was on the paper.



I was thinking
1. Why the half pencil & not a full pencil ? (quickly dismissed as irrelevant)
2. The pencil was supplied so I could give my answer in words or to draw a pattern that links the patterns
3. After studying the pattern - did they (a) require an explanation what the pattern was or (b) did they want the next pattern to be drawn (that was a major decision)
4. My thinking was that "a pencil is for drawing" - so I drew the next pattern
5. The exam seem to last forever but the answer came to me in a few minutes, the rest of the time I was struggling with what the question was that they wanted - explanation in words or the next image drawn.

We see patterns everywhere
Humans have a unique ability to spot patterns that has been fine tuned by evolution & we superbly adapted to understand the visual world. Pattern recognition is for our survival as a species & it's the very reason a cloud formation looks like a bunny or Elvis. Sometimes our mind deceives us presenting pattern when in fact there isn't any. We unconsciously take for granted how good we are at making sense of what our eyes show us & sometimes we don't appreciate how difficult it is when we are shown a new pattern without an explanation can be difficult to understand.

The answer I gave
I drew the next image, which was correct.



Skate.

 

[investtrader]

I may as well post this here, to get it off my chest.
Let's just say this a theoretical discussion about a listed company that belongs to the All Ords. A few founders own a very large chunk of shares and are involved in the daily running of the business. COV19 has hit but the company can still keep trading, which can't be said of a lot of businesses. It is in retail but doesn't operate in shopping centres. Trade to the end of March has so far been unaffected, but the next few months are uncertain.
They think trade may drop off (but just a guess)by more than 30% for a few months and would be eligible for over a million per month in government wage subsidies. They decide to sack 20% of the workforce. They also decide to cut wages to everyone by 25% to 50%. No reagrds to Fair Work Act. Staff are too scared to complain. In most cases staff are asked to work more unpaid hours due to the difficult trading conditions. They use a tactic of cutting rates per hour and after an agreement is in place say sorry you now only have 4 days per week work.
The major shareholders stand to be unaffected.
Is this the intent of the JobKeeper subsidy?
After this is over, they will loose most of their long term best staff which may the ultimate cost.

 

[Newt]

Ok, now I understand the question.

What was the answer to the puzzle
When I turned over the exam paper I was taken back to say the least, it caught me off guard then I focused on a few things, the hieroglyphics & the pencil. When I turned over the exam paper this confronted me. The hieroglyphics below was "all" that was on the paper.

View attachment 101937

I was thinking
1. Why the half pencil & not a full pencil ? (quickly dismissed as irrelevant)
2. The pencil was supplied so I could give my answer in words or to draw a pattern that links the patterns
3. After studying the pattern - did they (a) require an explanation what the pattern was or (b) did they want the next pattern to be drawn (that was a major decision)
4. My thinking was that "a pencil is for drawing" - so I drew the next pattern
5. The exam seem to last forever but the answer came to me in a few minutes, the rest of the time I was struggling with what the question was that they wanted - explanation in words or the next image drawn.

We see patterns everywhere
Humans have a unique ability to spot patterns that has been fine tuned by evolution & we superbly adapted to understand the visual world. Pattern recognition is for our survival as a species & it's the very reason a cloud formation looks like a bunny or Elvis. Sometimes our mind deceives us presenting pattern when in fact there isn't any. We unconsciously take for granted how good we are at making sense of what our eyes show us & sometimes we don't appreciate how difficult it is when we are shown a new pattern without an explanation can be difficult to understand.

The answer I gave
I drew the next image, which was correct.

View attachment 101936

Skate.

aGGGGHHHHH!!!
I'm still a fail!

 

[qldfrog]

aGGGGHHHHH!!!
I'm still a fail!

You aren't alone

 

[Skate]

aGGGGHHHHH!!!
I'm still a fail!

You aren't alone

It's a mirror of itself
The pattern is just mirror of itself, if that helps - If you can't work it out - let me know & I'll show you the mirrored pattern.



This is the answer



We see patterns everywhere
Humans have a unique ability to spot patterns to understand the visual world. Pattern recognition is for our survival as a species & sometimes our mind deceives us presenting pattern when in fact there isn't any. We unconsciously take for granted how good we are we at making sense of what our eyes show us but sometimes we don't appreciate how tough some are to solve.

Skate.