Discussion of article "Brute force approach to patterns search (Part II): Immersion"


New article Brute force approach to patterns search (Part II): Immersion has been published:

In this article we will continue discussing the brute force approach. I will try to provide a better explanation of the pattern using the new improved version of my application. I will also try to find the difference in stability using different time intervals and timeframes.

Let us start with EURUSD H1. Testing was performed in the interval 2010.01.01-2020.01.01. Its purpose was to find a global pattern:

The results are not very attractive, and this is all that we managed to squeeze out of the pair in the given time interval. We can identify a global pattern, although it is not so clear. I used 50 candlesticks in the formula for the brute force. The result is not as good as we could expect, but it is necessary. You will see further what for. Let us test the same segment in the forward period 2020.01.01-2020.11.01, in order to understand its future performance:

The results is quite understandable. This analysis turned out to be insufficient for trying to profit from the pattern continuation. General, if we analyze global patterns, then the purpose should be to find a pattern that will work for at least several more years, otherwise such an analysis is completely useless. At the beginning of the chart the pattern continues to work, but after six months it is inverted. So such an analysis may be enough for trading for several months, provided we manage to find good enough parameters of the initial test. In this case analysis was performed by the P_Factor value. This parameter is similar to Profit Factor, but it takes values in the range of [0...1] . 1 - 100% of profit. In the first tab, the highest value of this parameter was about 0.029. The average value of all found variants was about 0.02.

Author: Evgeniy Ilin