Trading Strategy CECJ
CECJ and other high complex parabolic systems
Trading System for Forex, I worked on not looking at "Authoritative opinion", trying to make the most of creative potential indicator of SAR (Parabolic). I needed an effective Forex trading system for allowing confidence in the market.
After completion of a desire to compare the benefits of its with the results of other authors, trading systems which are based on using as the main indicator SAR. The work had to deal with a lot of problems. As the authors of other similar systems to solve them?
try to identify the characteristics of current parabolic Forex trading systems and their background to determine individual features of the trading system SECJ:
1.Razlichnoe relation to the principle of negotiability.
idea of ??the back of the trading system is to obtain the maximum profit is necessary to open and close positions on levels as close to the points of reversal price chart (ie to turn (turning) points.) At the point of closing the position offers the following position in the opposite direction.
But the rules of some complex parabolic systems in certain cases provide a retreat from this principle.
Trading SECJ not always, when locked in position a separate instrument, it should open in the opposite direction.
used the principle of coherence and direction signals time to filter out individual fluctuations in the price individual instruments (and therefore the signal indicators on which they imposed) and thereby determine the turning points of all instruments. Objective: To determine the periods of coherent trade that most favorable to work at Forex.
recommend to think about Dave Landry saying: "Question: What is the process you go through before choosing a particular market and individual security, which would be worthy to bargain?
Dave: All these things mentioned above. Developing a whole trend, or I'm trading tool that can be traded independently the general state of the market? »FOREX MAGASINE, February 2006 ¹ 107/07
2.Osnovnoy used indicator SAR (Parabolic).
main indicator should be considered as an indicator, which signals are the main source of information for trading decisions.
In this regard, SECJ no different from other complex Parabolic trading systems on Forex.
3.Primenenie with major additional indicators.
purpose of additional indicators: the elimination of deficiencies SAR. In all systems, this technique is used in the case when the dignity of the main indicator significantly higher than its disadvantages.
Welles Wilder (author of the indicator SAR) has created a display capable capture a larger share of the profits in a trending market. And it is the main advantage of this indicator. But he has a serious drawback: the low efficiency when working in corrections. By means of additional indicators the authors try to identify only those signals which indicate the beginning and end of a trend.
set of additional indicators used varied: ADX, RSI, MACD, Bollinger Bands, Stochastics, the index of directional movement (DMI), etc. Sometimes used in conjunction with the Parabolic some additional indicators. Of course, each of these systems have advantages and disadvantages. Acquainted with many of the them, I did not consider it appropriate to make any changes in its trading system.
SECJ In conjunction with SAR applied to AI, but its purpose use - just smoothing fluctuations to some extent prices. But the problem of determining the trend of movement is decided by comparing the signals emanating from the SAR of all instruments of trade system. Part of the functions that perform additional indicators (Eg, determining the positions of points increase) can be solved using Parabolic few (2 to 4 - "fast" and "slow") on each instrument.
4.Neobhodimot use of certain scales of graphs.
The vast majority of complex Parabolic systems involve work on daily and weekly charts. Large scale chart smooths out fluctuations in prices, and thus makes the system more reliable. But on the other hand, work on the charts with big time scale reduces the profitability of the system. The authors of all high-yielding system in the process of developing their systems solve Main task of finding a middle ground between high profitability and stability of its receipt. In my opinion, the smallest scale of the graph, which allows to use a trading system testament to its quality.
Recommended desktop SECJ includes the following candlestick charts: 10 minutes, 12 minutes, 2:00, 3:00, 6:00, 8:00, day. The choice of scale work schedules based on specially developed the principles. And the smaller and larger scale chart use impractical. Must say that the work of 10 minute, 12 minute charts requires certain skills. More Experienced traders work short positions, usually within the day, using a 12-timinutnye and 2 hchasovye graphics.
5.Dopolnitelnye trading rules.
basic rules define the operation of the main display, but the additional trading rules solve a variety of tasks:
- Filtering the signals of the main indicator;
- Define point increase in the position, etc.
In my opinion, the content of additional trading rules to fully manifest personality Trading System (Forex).
Trading System Perry Kaufman has the following contents:
«1. Use the 14-day DMI.
2. If DMI indicates upward movement, take only Parabolic long trades. If DMI is falling, take only short sale.
3. Enter the auction only if the systems are consistent. If they conflict, trade does not make.
4. Use parabolic stop-only output, rather than the reverse. "
5. The very existence of these rules indicates the complexity of the data Trading System (Forex). CECJ in this area is not allocated to the general series.
6. The need to identify an individual trading style.
Obtaining knowledge about one of these trading systems is
only the first step towards its successful application in trading.
The next most important step is to determine the individual
style of trading in this system. This concept includes
- A possible time;
- Selection of potential risk;
- The size of the deposit;
- "Long" positions;
- Psychological qualities of the trader (and perhaps most importantly), etc.
It is possible that a trader will face a situation where system really works well on the forex market, but due to various reasons he could not use its potential. And some of really efficient traders refuse.
It is essential that the trading system was the most tolerant of diverse styles of work. In this regard, the possibility of Many trading systems are very limited. And on this important point should always be remembered.
analyzing traders' work can be identified using CECJ about eight basic individual trading styles.
7.Osobo are important parameters of the trading system.
birth origins of all complex systems lie in the Parabolic experiments with the parameters of the main indicator. It should say that the author has identified Parabolic mean values ??of the parameters which he claimed to be effective in working with all tools (step = 0.02; AFmax = 0.20). But on the other hand, Wells Wilder repeatedly wrote that must not be afraid individualize settings SAR. The striking effect of optimization with 1978 is haunted by the traders.
On this issue, there are opposing views. Someone prefers to work with "classic" parameters (and it advises do to others). At various time intervals appropriate optimize the parameters, and because this process is extremely time-consuming, it should work on the parameters recommended by the author. (Therefore, be content with low profit). Fortunately, the authors complex Parabolic systems of a different opinion. But I do not had to meet the data among the differentiated approach to the TC optimization parameters.
conducting experiments with the optimization parameters, the idea differentiate options trading system. Differentiation carried out by a computer program «CECJ-optimization." Incorporated into the program guidelines allow the vehicle to be at peak efficiency (Not allowing it to "upset" like musical instrument).
High yield is the main purpose of creating such systems. Usually these systems are able to provide income over 10,000 points per year. But keep in mind the difference between the potential profitability of the trading system and the real profits traders (who depends on the individual style of work). For current trading systems important not to miss a signal (as the late-closing opening position leads to losses). It is especially important to "take over" trend.
Trade for four instruments (USDCHF, EURUSD, CBPUSD, USDJPY) increases the potential profitability of the trading system CECJ 50 000 points per year.
It should be noted that information about high-yield trading systems is extremely limited. The published material is not enough information on matters of importance. For example, optimal scale work schedules, options, SAR, and other indicators used, additional trading rules, etc.