How can you trust the analysis after that? - page 9
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Good commentary. I can only add that whatever methodology a trader uses, it is important that existing levels are not redrawn when drawing new levels. If this happens, it should be assumed that the level calculated above is incorrect. Thus, the method used does not work.
I can say for myself, I use a calculation method that can only increase the number of levels calculated or decrease them. Instead of changing the arrangement of levels.
The number of levels displayed on the chart depends on how many times price has historically bounced off that price. The fewer times it happened, the more levels will be on the chart.
Conversely, if price has historically bounced relatively many times from this level, there will not be many levels on the chart.
Not to mention that I don't build any levels by looking at the chart, believing that there must be a level where price will stop.
All that is visible is the algorithm's calculation. It can also be subjective, depending on the implementation of the code. But when the algorithm works with conditions, it doesn't matter if the trader likes the level or not, the level found simply matches the conditions in the algorithm.
The algorithm you mention is nothing else but an algorithm of informational support of trader's activity, in fact - automation of the decision-making process. Decisions, for the consequences of which the trader and only the trader will be responsible, not the algorithm or its developer. With his own money he will be responsible.
I have some experience in automating the control of troops, namely in developing algorithms of informational support of the decision-maker's activity. This person is always the only one, and he bears all the responsibility for the decision made, all alone, because besides the analytical and volitional aspect, the decision also has a juridical aspect.
For as long as I have worked on this topic, I have constantly encountered proponents of the "model" approach, who included in the ACS a model of the development of events and showed the manager the "only correct" decision, which he should take and be responsible for. I have never liked it, not at all.
There is another approach - to automate routine activities and leave the key elements to humans. Developing such an approach implies "guessing" a person's opinion, adjusting to the course of his judgment. In simple terms, the same manager, the same algorithm, the same result. This is how CNC machines are trained, by the way. They employ an experienced turner and the machine learns from him. I tried to make algorithms of this type.
Of course, support/resistance levels are relatively objective values, here I agree with you. However, I know people who work quite successfully without paying much attention to those levels, and set their own target levels.
Well, I'm not for and against. It's just a follow-up to the topic.
Another approach is to automate routine activities and leave the key elements to humans. The development of such an approach implies "guessing" a person's opinion, adjusting to the course of his judgement. In simple terms, whatever the manager, whatever the algorithm, whatever the result. This is how CNC machines are trained, by the way. They employ an experienced turner and the machine learns from him. I tried to make algorithms of this type.
Of course, support/resistance levels are relatively objective values, here I agree with you. However, I know people who work quite successfully without paying much attention to those levels, and set their own target levels.
Well, I'm not for and against. It's just a continuation of the theme.
I completely agree with you.
The readers of this forum misunderstand my views on levels or I can't explain them correctly due to the language barrier. But I always say that such levels are a kind of ADDITIONAL information about what has historically happened at this price. Because I myself create the conditions to find such levels, I understand their meaning much better than a mere observer from the outside.
The point is that I try to find the price level from which price has bounced as many times as possible.
Honestly, I don't know on what time frame and when these price levels occurred. All I can say is that they formed at +- 10 pips (5 symbols) and repeated over 100 times.
I totally agree with you.
Forum readers misunderstand my views on levels or I can't explain them properly because of the language barrier. But I always say that such levels are kind of ADDITIONAL information about what has historically happened at that price. Since I myself create the conditions for finding such levels, I understand their meaning much better than just an outsider observer.
The point is that I try to find the price level from which price has bounced as many times as possible.
Why as many times as possible? Maybe just the relevant ones to take? The ones that are here and now.
Why as many times as possible? Maybe just take the relevant ones? The ones that are here and now.
It's not that simple, it all started with a question: are there levels relevant in different time periods, for example M15 and H6? Then it turns out that you can't look only at: now and here.
It's not that simple, it all started with a question: are there levels relevant in different time periods, for example M15 and H6? Then it turns out that you can't look only at: now and here.
It's not periods, it's just a way of displaying information, a picture, a scale - that's all. You shouldn't base a trend-finding algorithm on the way the information is displayed, imho.
It's not periods, it's just the way the information is displayed, the picture, the scale - that's all. You should not base a trend-finding algorithm on the way the information is displayed, imho.
If you follow this view, then no indicators can be used.
RSI M15 has a signal.
RSI H1 has no signal.
How then should the indicators be read if noscale is used?
I'm not talking about the signal, I'm talking about the trend.
I think we misunderstood each other, I was reading inattentively, but you misunderstood what levels mean to me. Levels have nothing to do with trending or finding it.
I think we misunderstood each other, I was reading inattentively, but you misunderstood what levels mean to me. Levels have nothing to do with trending or finding it.
Whatever you say.
....
The point is that I am trying to find the price level from which price has bounced as many times as possible.
....
What is the practical significance of how many times price has bounced from your imaginary level. For intraday trading and to improve your entry point in the medium term, only the nearest highs and lows have practical value. These are the places where the price changed its direction, and the price does not just change direction it was reversed by market traders' trades. The price was rising then began to fall, that is, at that point in time they were selling more than they were buying. In other words, there are a lot of open sell positions or previous longs were closed there and, possibly, there is a large sell limit that could not be closed because there were not enough buyers to close it completely and remove the obstacle for the further upward move. The reason why the buyers sold more than they bought is not shown on the chart. They may be longers closing long positions and they may be shorts that open new shorts positions. All forex offices do not broadcast to their users the real market, there is no trading feed, the volume is in the form of the number of trades passed only. What happens when the price approaches the nearest extremum can only be guessed from the colour of the candle and its shadows, and how to interpret it is limited only by the trader's imagination.
There are scripts that analyze the tape of deals and open interest for futures. When approaching such a "fresh" extremum, it is very interesting to observe the tape and Open Interest. For example, there is a local maximum and the price breaks it. The number of buy deals sharply increases and at the same time the Open Interest also decreases. It may be concluded that the shorts have triggered the stops that were behind that high. The sales are closing by buying, and the number of open positions (which shows the Open Interest) is decreasing. If at this level there were also buy stops, calculated on its violation, the Open Interest may not change or may change slightly, and even may grow sharply. Thus, when short stops trigger, buy stops trigger new buy positions as well.