Discussion of article "Developing a self-adapting algorithm (Part I): Finding a basic pattern" - page 5

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Great Read! Anticipating the next one!
 

General simplified algorithm

  • a window of N candlesticks is scanned;
  • the window of N candlesticks is scanned; it is checked whether there are more falling or rising candlesticks;
  • if the preponderance is greater than the threshold, the signal to start a series of positions;
  • more falling candlesticks = Buy signal, more rising candlesticks = Sell;
  • lot is calculated;
  • a new position is opened at each next candlestick until the series closing condition is triggered;
  • series closing condition is triggered;
  • all positions are closed;
  • search for a new signal.


The author invented the RSI indicator. Bravo!

 
Since you are using the second method, maybe it's good to change the topic because the algorithm given is not really self-adapting. The strategy looks interesting though.
 
Eric Pedron:
Since you are using the second method, maybe it's good to change the topic because the algorithm given is not really self-adapting. The strategy looks interesting though.
yes, this algorithm is not self-adapting, it is the first step towards developing an idea.  There will be 4 articles in total and in the last two I will show you fully adaptive.
 
Aleksey_Kryukov:

General simplified algorithm of operation

  • a window of N candlesticks is scanned;
  • the window of N candlesticks is scanned; it is checked whether there are more falling or rising candlesticks;
  • if the preponderance is greater than the threshold, the signal to start a series of positions;
  • more falling candlesticks = Buy signal, more rising candlesticks = Sell;
  • lot is calculated;
  • a new position is opened at each next candlestick until the series closing condition is triggered;
  • series closing condition is triggered;
  • all positions are closed;
  • search for a new signal.


The author invented the RSI indicator. Bravo!

Relative Strength Index

RSI= 100 - (100 / (1 + U / D))

Where:

U - average value of positive price changes;
D- average value of negative price changes.

not the RSI indicator is analysed, but the number of falling and rising candles, this is a different meaning. Yes then, when positions start to open, there is an analogy with the indicator. With the help of a set of positions, the formula becomes similar. And not exactly, but only similar. Plus, the indicator has a period, and positions are opened on the period on which it is necessary.

There can be many criticisms of this system, it is far from perfect, but the fact that it is RSI is overkill. The system is as similar to RSI as an aeroplane is to a car. Both have wheels and both burn fuel.

 
You are searching for the efficiency, not for the equilibrium... For this work, are you sure that only the number of the candles is the unique place to see and if you will see too the average of the amplitudes between open and close could be more accurate and we can see other things...? You are treating the candles as a simple bet, like red and black in roulette, but the roulette is a closed circuit with almost 100% of efficiency and do not have opposite forces, only the 0s...
To have a self-adapting approach, we will be need an engine to see first the start point to counting and the duration time to count... The time and amplitudes of the the movements, averages, discards, the cycles... etc...
 
Luis Leal #:
You are searching for the efficiency, not for the equilibrium... For this work, are you sure that only the number of the candles is the unique place to see and if you will see too the average of the amplitudes between open and close could be more accurate and we can see other things...? You are treating the candles as a simple bet, like red and black in roulette, but the roulette is a closed circuit with almost 100% of efficiency and do not have opposite forces, only the 0s...
To have a self-adapting approach, we will be need an engine to see first the start point to counting and the duration time to count... The time and amplitudes of the the movements, averages, discards, the cycles... etc...


I wrote 3 more articles on this topic, here are the links to them in order, read how the model developed and what I came to in my articles.

2 - https://www.mql5.com/en/articles/8767

3 - https://www.mql5.com/en/articles/8807

4 - https://www.mql5.com/en/articles/8859

I also have articles preceding this one, in which I bring them to the topic.

Naturally, I did not stop and continued to develop the theoretical model. Now I can already tell how the price series differ from a random walk, how to find these differences and what are the reasons for these differences. In the articles I have not described this yet, but read my next works, you may be interested.
Developing a self-adapting algorithm (Part II): Improving efficiency
Developing a self-adapting algorithm (Part II): Improving efficiency
  • www.mql5.com
In this article, I will continue the development of the topic by improving the flexibility of the previously created algorithm. The algorithm became more stable with an increase in the number of candles in the analysis window or with an increase in the threshold percentage of the overweight of falling or growing candles. I had to make a compromise and set a larger sample size for analysis or a larger percentage of the prevailing candle excess.
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