Forums Trading Systems Discussion True Bars/Candles and Market Sentiment

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  • #8455
    Innate
    Participant

      This is following up a comment that @gg53 made about “True Bars”

      http://penguintraders.com/forums/topic/a-flexible-and-compact-currency-strength-indicator/page/5/#post-8441

       


      @gg53
      : If you are willing to tell us, I would be keen to hear more about how you define “True Bars” please?

      Thank you.

      What's it all about? It's all about money.

      #8479
      VlanFx
      Participant

        thanks Innate, you beat me to this thread :)

        anyway, looking forward to GG’s teachings  :good:

        #8536
        gg53
        Participant

          After drawing the “virtual candle/bar” (price movement from point A to B, regardless of intermediate bars):

          Devide that bar length into roughly 3 equal sections: top third is BUY sentiment, middle third is NEUTRAL or in-decision, lower third is SELL sentiment.

          Following bars CLOSE, that are engulfed by that bar, determine the market sentiment at that point.

          You compare those bar CLOSE to the “thirds” in the previous virtual bar.

           

          G.

          #8539
          Innate
          Participant

            After drawing the “virtual candle/bar” (price movement from point A to B, regardless of intermediate bars): Devide that bar length into roughly 3 equal sections: top third is BUY sentiment, middle third is NEUTRAL or in-decision, lower third is SELL sentiment. Following bars CLOSE, that are engulfed by that bar, determine the market sentiment at that point. You compare those bar CLOSE to the “thirds” in the previous virtual bar. G.

            Thanks for the reply. Any chance of an image to understand this please?

            How do you determine Point A and Point B? Is this arbitrary? Are there values we can push into an indicator to show True bars?

            Thanks.

            What's it all about? It's all about money.

            #8541
            gg53
            Participant

              After drawing the “virtual candle/bar” (price movement from point A to B, regardless of intermediate bars): Devide that bar length into roughly 3 equal sections: top third is BUY sentiment, middle third is NEUTRAL or in-decision, lower third is SELL sentiment. Following bars CLOSE, that are engulfed by that bar, determine the market sentiment at that point. You compare those bar CLOSE to the “thirds” in the previous virtual bar. G.

              Thanks for the reply. Any chance of an image to understand this please? How do you determine Point A and Point B? Is this arbitrary? Are there values we can push into an indicator to show True bars? Thanks.

              Sorry about my previous “sloppy” post…

              I don’t have much time this week, but Vladimir pointed me to this thread via Skype – so I felt compeled to respond.

              I’ll sure post detailed explanation, but please excuse me if it’ll not be this week.

               

              G.

              #8547
              Innate
              Participant

                After drawing the “virtual candle/bar” (price movement from point A to B, regardless of intermediate bars): Devide that bar length into roughly 3 equal sections: top third is BUY sentiment, middle third is NEUTRAL or in-decision, lower third is SELL sentiment. Following bars CLOSE, that are engulfed by that bar, determine the market sentiment at that point. You compare those bar CLOSE to the “thirds” in the previous virtual bar. G.

                Thanks for the reply. Any chance of an image to understand this please? How do you determine Point A and Point B? Is this arbitrary? Are there values we can push into an indicator to show True bars? Thanks.

                Sorry about my previous “sloppy” post… I don’t have much time this week, but Vladimir pointed me to this thread via Skype – so I felt compeled to respond. I’ll sure post detailed explanation, but please excuse me if it’ll not be this week. G.

                 

                No rush matey. This is a long game. :)

                Thank you.

                What's it all about? It's all about money.

                #8765
                gg53
                Participant

                  Rules of the “Game”:

                  1. Accept the FACT that there is NO Open, High, Low, Close in any TimeFrame. The market is continous. What you see on the charts is just a “sampling rate” and snapshot.

                  2. 5 bars/candles in M1 == 1 M5 bar, 3 bars/candles in M5 == 1 M15 bar, etc…, so there is really no “Close”…

                  3. There are just a few TRUE TimeFrames that truely relates to TIME: Sessions (i.e. London, NY, London+NY, Asian) and Weekly (Friday Close).

                  4. The Sessions are rapidly loosing their effect because of less Human and more and more computer Algo-Trading.

                  5. Price is best viewed in “Channels” perspective, and not in bars/candles.

                  6. The simplest, single dimension form of “channel”, is the ZigZag indicator. Above that is the ATR channel, and there are more…

                   

                  To be continued…

                   

                  G.

                   

                   

                  #8797
                  simplex
                  Moderator

                    Rules of the “Game”

                    Great summary!

                    The only reason to regularly choose close price as the basis of most indicators is to get the most recent indicator readings on bar zero. For every other purpose it’s meaningless.

                    5. Price is best viewed in “Channels” perspective, and not in bars/candles.

                    Would you say that such a channel perspective could be implemented in a currency strength indicator? Does that make sense?

                    While typing these questions a possible connection to our RSI discussion in my CS thread comes to my mind: RSI would make perfect sense when utilized inside a channel.

                    s.

                    A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

                    #8826
                    gg53
                    Participant

                      In down-swing, some candles LOW is lower than the previous candles LOW in that swing, some are not.

                      But…

                      A candle LOW is always lower than all the previous candles HIGH, and this is the invariant for a down-swing.

                      If a candle breaks this rule, it starts an up-swing. It’s the basic nature of any bar-chart, so you don’t need parameters or indicators. Just “naked trading” (don’t do in the winter, you’ll catch cold).

                      You can watch how far the current bar is from breaking that rule, and can consider that as the movement strength or “sentiment”.

                      For interpretation purposes, you should know that it shows swings and NOT trends. A trend consists of many swings.

                      But…

                      If movement is a swing in a larger TF, it can easily be a trend in a smaller TF.

                      If you see a strong (but not oversold/overbought) swing in larger TF, switch to lower TF, and you can spot the start of smaller “trend”.

                       

                      G.

                      #8828
                      gg53
                      Participant

                        Rules of the “Game”

                        Great summary! The only reason to regularly choose close price as the basis of most indicators is to get the most recent indicator readings on bar zero. For every other purpose it’s meaningless.

                        5. Price is best viewed in “Channels” perspective, and not in bars/candles.

                        Would you say that such a channel perspective could be implemented in a currency strength indicator? Does that make sense? While typing these questions a possible connection to our RSI discussion in my CS thread comes to my mind: RSI would make perfect sense when utilized inside a channel. s.

                        The “Channel” uses the RANGE (length) of a price bar, and not the choppy and chaotic OHLC.

                        It’s effective in all TimeFrames and doesn’t lag.

                        It’s also (or mainly) effective because it is based on a basic statistical concept: if two distributions doesn’t overlap, they can be considered different.

                         

                        G.

                        #8878
                        gg53
                        Participant

                          So after absorbing and understaning the above – here comes the practical side:

                          1. Price moves like water or rivers – you can read about it in Hurst’s work and my other postings on that subject. It means it flows where it’s easy and there is less obstacles.

                          2. Water/River flows according to the landscape beneath it. If you open a damm the water will flow according to the dry valley or creek path.

                          3. Sometimes, if the water flow is too massive or rapid, it will deviate slightly from that path, but returns to it soon enough.

                          4. Can we see this valley/Creek path? or better yet: can we see it in advance? Yes, with more than >80% accuracy.

                          … to be continued …

                           

                          G.

                          #8879
                          gg53
                          Participant

                            Ok, we went to the wilderness and watch a river flow. The National Park authorities put a sign stating that the river is 60 feet deep.

                            How do we figure out what’s the river-bed contour looks like? and what about some levels above the bottom, since it’s probably not just straight walls?

                            Ahhh, we have a Sonar. We built one in the previous few posts… a range (the only TRUE info we have) is the High/Low of that candle.

                            At 1 feet above bottom – draw the M1 range channel…

                            At 5 feet above bottom – draw the M5 range channel…

                            At 15 feet above bottom – draw the M15 range channel…

                            At 30 feet above bottom – draw the M30 range channel…

                            At 60 feet above bottom – draw the H1 range channel…

                             

                            Put all the above on one H1 chart (the 60 feet deep river)  and you got a Sonar view of the landscape/contour of the river-bed below the water level !!

                            …And… 5 minutes before that H1 bar ends (or any other time before the bar close)…

                            Since the H1 bar is not finished yet – BUT …

                            At least 1 M30 bar is finished, and extending out of the H1 chart +…

                            At least 3 M15 bars are finished, and extending out of the H1 chart + …

                            At least 11 M5 bars are finished, and extending out of the H1 chart +…

                            At least 55 M1 bars are finished, and extending out of the H1 chart:

                            We now know, with Physical evidence & FACTS – where the river must be heading… with increased probability (>80% according to my years of testings). You’ll also know, in each TF, where the Market sentiment is based on its lower TF channel.

                             

                            Create an MQ4 indie and post it here. You can call it G_Tactics. Now you can figure out how I came to the published results of the “1 pip compounding” thread.

                            … and also one more secret revealed regarding the ForexGT_Arrow indie.

                             

                            Don’t forget to invite me to the launch party of your new yacht…

                             

                            G.

                            #8890
                            simplex
                            Moderator

                              Don’t forget to invite me to the launch party of your new yacht

                              Ahemmmm – would a party in a mountain cottage also be appropriate? I’m sure I would consider this first before looking for a yacht. And since there’s no catering service around, we would have to cook our own spaghetti in the evening (Italian style, not G’s indicator style!). And probably we would have to carry every single bottle of wine in our backpacks.

                              s.

                              A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

                              #8891
                              simplex
                              Moderator

                                G_Tactics

                                Just thinking: would it be appropriate to replace that H1 HL range (low sampling rate) by a 60 period Donchian channel on M1 (sampling rate increased by a factor of 60), M30 HL range by a 30 period Donchian channel, etc.?

                                So we would not have to care about different sampling rates, or how many M5 candles are left within our current H1 candle. Constant sampling rate of 60 candles per hour.

                                See pic as a first idea with 4 channels at 60, 30, 15, and 5 periods.

                                When we now flatten the bottom (60 period low) we get a view of variable depth of the river, with the other channels inside.

                                One more advantage: we’re not bound to those rigid timeframe steps of MT4 anymore.

                                Any disadvantages as compared to your original G_Tactics?

                                s.

                                Attachments:
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                                A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

                                #8893
                                gg53
                                Participant

                                  G_Tactics

                                  Just thinking: would it be appropriate to replace that H1 HL range (low sampling rate) by a 60 period Donchian channel on M1 (sampling rate increased by a factor of 60), M30 HL range by a 30 period Donchian channel, etc.? So we would not have to care about different sampling rates, or how many M5 candles are left within our current H1 candle. Constant sampling rate of 60 candles per hour. See pic as a first idea with 4 channels at 60, 30, 15, and 5 periods. When we now flatten the bottom (60 period low) we get a view of variable depth of the river, with the other channels inside. One more advantage: we’re not bound to those rigid timeframe steps of MT4 anymore. Any disadvantages as compared to your original G_Tactics? s.

                                  Most people understand the chart better if they see just one channel that engulf another channel, etc.

                                  By using it as described you can see the bias and sentiment more clearly, in a total of 5 one directional channels.

                                  4 of them are extending out of the H1 channel.

                                  We don’t want any MA’s or any other approximation line that wasn’t there by “nature”.

                                  The end product should look like that any higher TF is engulfing its lower TF. This way we can determine bias or “sentiment”.

                                   

                                  G.

                                  #8896
                                  simplex
                                  Moderator

                                    Ok!

                                    Let’s consider this one a first try, not more! I decided to hold onto Donchian for now, because I already have it and it’s easily implemented with no timeframe fiddling. Also that high sample rate seems advantageous to me.

                                    Now, the ‘bottom line’ of our sonar is flattened, while the surface level varies. Could easily be changed to a constant (water) surface level, while ground level varies. Or totally normalized: bottom and surface level flattened.

                                    Also possible: eliminate part of the inner lines – highs, lows?

                                    Or did you mean to project only the ‘range’ of the inner channels on top of the river bottom? Or below the river surface? Thus we would loose the absolute position of the inner channels inside the outer, engulfing one. Don’t know whether you meant that.

                                    In the end, this would only be a different visualization, while the basic channels remain the same. Many different sonar views are possible.

                                    s.

                                    Attachments:
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                                    A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

                                    #8899
                                    simplex
                                    Moderator

                                      By using it as described you can see the bias and sentiment more clearly, in a total of 5 one directional channels. 4 of them are extending out of the H1 channel.

                                      Ahhh – I did not notice these remarks at first – did you edit your post?

                                      I would interpret ‘5 one directional channels’ as 5 channels with a common top or bottom.

                                      ‘4 of them are extending out of the H1 channel.’ Hmmm – stacking those channels?

                                      s.

                                      A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

                                      #8901
                                      gg53
                                      Participant

                                        If using M1 chart:

                                        M1 channel – should be from bar 1 till end bar on the high/low of each one.

                                        M5 channel – should be from bar 5 till end bar, stepping 5 bars on the high/low of each 5’th bar.

                                        M15 channel – should be from bar 15 till end bar, stepping 15 bars on the high/low of each 15’th bar.

                                        etc…

                                         

                                        G.

                                        #8902
                                        gg53
                                        Participant

                                          If you do it on H1 chart (or any other higher than M1 – my prefered and used method):

                                          You should extend the already closed lower TF bars/channels to the right of the H1 (as if “prediction” bars, but they are actually real ones).

                                          For those extended bars the TIME is meaningless, and they should be scaled to the H1 scale. More complicated to program, but more revealing…

                                           

                                          G.

                                          #8903
                                          simplex
                                          Moderator

                                            If using M1 chart: M1 channel – should be from bar 1 till end bar on the high/low of each one. M5 channel – should be from bar 5 till end bar, stepping 5 bars on the high/low of each 5’th bar. M15 channel – should be from bar 15 till end bar, stepping 15 bars on the high/low of each 15’th bar. etc…

                                            Ok – hope nobody will convict me for coding a repainter! ;-)

                                            A good trader is a realist who wants to grab a chunk from the body of a trend, leaving top- and bottom-fishing to people on an ego trip. (Dr. Alexander Elder)

                                            #8905
                                            LearnAlways
                                            Participant

                                              Hi Simplex,

                                              This is what I posted on another forum on 10-31-2015, 01:27 AM. Is it possible to just display horizontal lines for simplicity sake since the donchian channel can be quite distracting because of the shape but I thought we can just compare how the lines will look as compared to the donchian channels. And see which is more visually appealing to the eye. Cheers :-)

                                              Pls help modify high low indicator <!– BEGIN TEMPLATE: postbit_pinterest_vb4 –>

                                              <!– END TEMPLATE: postbit_pinterest_vb4 –>

                                              Hi Igorad,

                                              Is it possible to modify this indicator? It would be great if u have a better version.

                                              1) Include M5, M15, M30, H1, H4, Yearly High Low?
                                              2) Option to show label whether its daily or weekly or monthly
                                              3) Options to show no. of pips inside range
                                              4) Option to display in rectangle filled with and without BACKGROUND color
                                              5) Option to change the width & style adjustable for the all the horizontal lines
                                              6) Pls remove the pivot lines in the code as it will take up additional memory and I can always use another pivot indicator if there’s any need.
                                              7) Option to show Open Line for all TFs.

                                              Thanks & Best Regards,
                                              LearnAlways
                                              <a title=”Name: ! Daily-Weekly-Monthly Hi-Low.mq4
                                              Views: 0
                                              Size: 20.3 KB” href=”http://newdigital-world.com/attachments/trading-systems-tools/16402d1446225945-discussion-requests-daily-weekly-monthly-hi-low.mq4″&gt;! Daily-Weekly-Monthly Hi-Low.mq4

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                                              I only know I know nothing
                                              Skype: learnalways@outlook.com

                                              #8908
                                              gg53
                                              Participant

                                                This reply has been reported for inappropriate content.

                                                If using M1 chart: M1 channel – should be from bar 1 till end bar on the high/low of each one. M5 channel – should be from bar 5 till end bar, stepping 5 bars on the high/low of each 5’th bar. M15 channel – should be from bar 15 till end bar, stepping 15 bars on the high/low of each 15’th bar. etc…

                                                Ok – hope nobody will convict me for coding a repainter! ;-)

                                                Maybe you don’t understand – but this shouldn’t repaint.

                                                 

                                                G.

                                                #8912
                                                LearnAlways
                                                Participant

                                                  Hi gg53,

                                                  Sorry for asking a stupid question, but by drawing those lines will it look similar to what Kiads Star, Skull & Smiley indicator does? :scratch:

                                                  I mean will there be some similarity since most of the lines are also high low. :unsure:

                                                  Best Regards,

                                                  LearnAlways

                                                  I only know I know nothing
                                                  Skype: learnalways@outlook.com

                                                  #8914
                                                  LearnAlways
                                                  Participant

                                                    Hi Simplex,

                                                    Pls see attached Multi-Donchian channel indicator I modified ages ago, I tried putting all the donchian channels with different TF settings but it looks like a mess, maybe got to do with my modification too, but I did it to show when price starts moving one direction. Pic shows M15. M30, H1, H4, D1

                                                    http://penguintraders.com/forums/topic/true-barscandles-and-market-sentiment/#post-8914

                                                    • This reply was modified 8 years, 7 months ago by LearnAlways. Reason: Attach pic
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                                                    I only know I know nothing
                                                    Skype: learnalways@outlook.com

                                                    #8920
                                                    pipatronic
                                                    Participant

                                                      Watching with great interest, appologies for not contributing

                                                      pip

                                                      skype : pipatronic

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