a trading strategy based on Elliott Wave Theory - page 193
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If I'm not mistaken, this is my 3rd or 4th definition of volatility and they all differ significantly from each other. In our discussion with Yurixx we gave, if memory serves me correctly, considerable space to the very philosophy of this concept as a measure of risk. As I understand it, all the calculations I am familiar with do not reflect the very essence. More often than not, volatility loosely replicates "large" price movements, i.e. if the market is rising, then volatility is also rising, and it would seem this should be interpreted as increased risk and not trying to trade at increased risk. But then, where is the point? Unfortunately I can't find a decent place for volatility. Maybe someone can tell me how it can be used.
I agree with you, it does not make much sense.
With volatility you can evaluate the profitability of TS, but who does it? No one. Volatility indirectly determines the degree of risk of an open position. Indirectly, because the degree of risk depends primarily on the size of the deposit, the level of Stop Loss and the number of quid per one pip of open position, and only indirectly on the volatility, which determines the minimum value of Stop Loss.
Thanks Rosh. But it seems to be the same, only as an oscillator. Price goes up - volatility goes up, price goes down, so does volatility, with a delay and depending on the specific "data structure" there can be a significant delay. I envy Solandr, he is able to detect a reversal before it is complete, maybe Solandr will share his sacral knowledge (no jokes and no irony, it is really interesting, unless it is a trade secret, which I completely admit). It seems clear, if the chart comes to its "limit", one must expect the reversal, but most probably it has already happened and it is visible to the naked eye at the price.
:о)
Neutron
I agree with you, there is not much point.
With volatility it is possible to estimate the profitability of TS, but who does it? No one. Volatility indirectly determines the degree of risk of an open position. Indirectly, because the degree of risk depends primarily on the size of the deposit, the level of Stop Loss and the number of quid per one pip of open position, and only indirectly on the volatility that determines the minimum value of Stop Loss.
Hooray, so I'm not the only one. I mean, I've read many articles praising the volatility but I cannot figure out what it may give me. :о)
I do not know, I have already stated my main thoughts about reversals. It is all the same "convergent" regressions of the first and second orders, which probably have already worn out by all here. Completely switched to graphical plots for analysis. For the sake of reliability, in my Expert Advisor, I consider the turning point to be the point where the price exceeds the 96% probability limit by parabolic and linear regressions. The channels that serve as the basis for considering this point as a pivot must be not less than 2.8*Close[0]*(Relative average width of the bar for the current day of the week). The average bar spread (High-Low), for example, I calculate using the last 500 trading days. To be more exact, since we have 5 trading days in a week, for each day of the week I am using 100 daily bars respectively. For most of the currencies this indicator grows 10%-15% from Monday to Friday. That is, knowing the dimensionless relative index of the bar spread we multiply it with the price of the current bar closing and obtain the average spread of the current day. Well, the coefficient of 2.8 has been chosen purely for visual considerations when looking at price charts. Since I build two channels of parabolic and linear regressions, the turning point is of course obtained using the widest channels. In addition, we determine purely programmatically whether a certain channel is suitable for determining a pivot point in the D1 charts. I define the width of the channel on the boundaries of the 96% confidence interval. Of course, a position should be entered based on other factors confirming the reversal, rather than just the moment the price leaves the 96% confidence interval in both regressions, as the market sometimes experiences strong breaks of the wide channels as well. When the reversal has already been confirmed by other methods, the price, as a rule, cannot exceed it when retesting the extremum. Accordingly, the reversal extremum is a Stop Loss point (of course, it is preceded by a few pips of the spread if the position is SELL and plus 1 Point, while for BUY, it is simply minus 1 Point from the reversal extremum).
I am just now polishing the precision of the technique of entering on the reversal, as well as possible further adding to the position. I use linear regression channel on M30 timeframe for entering, although it is possible to get similar results on H1 or H4. SK says if you cannot identify the turning points everything else is of no help. I hold roughly the same opinion. And the rest are most likely just details which will be different on every trend and can hardly always be detected with sufficient accuracy. Therefore, I would like to experiment simply with holding a position from one pivot point to another without any numerical calculations, but with a certain strategy of moving the stop loss. Let's see what it may yield in the future.
For example http://forex.kbpauk.ru/showflat.php/Cat/0/Number/40044/page/0/fpart/1/vc/1
Alex, best of luck in the new trading period. Looking forward to your amazing results.
Thanks for the wish :)
Using stop loss and trailing stop sets a new, better level of trading.
I will send you the statement as soon as the month is over.
Thanks for the volatility. I would like to ask your help with another question.
Suppose I have two indicators, each of which shows the probability of some event (for example, that the price will go up by at least N points). The indicators are naturally correlated and their correlation coefficient can be calculated. How can I calculate the total probability of an event from these two numbers?
Thank you in advance.
Have you revised your forecast for the euro or do you think it will still fall ?
Yurixx have you still not understood that prognosis is not a good thing? :)))
Вы пересмотрели свой прогноз по евро или полагаете, что он все-таки упадет ?
Yurixx have you still not understood that prognoses are not a good thing? :)))
I was interested in your answer to the euR. Although I am not interested in the forecast itself. :-)
And your question, quite rhetorical, is a way of not answering. That's up to you.