“Following directions to
the letter!”
The
“special indicator” for “The Tunnel Method” has been added to the manual
starting on page 11; for a full explanation, simply go over in the right-hand
column to “Download Links” and view or download the PDF; it’s completely free,
in Adobe PDF, and is available from my shared files box at box.com. It’s simple
[nothing is ever easy], straightforward, and for you “Newbies” out there, if
you successfully passed 2nd grade, you won’t have any problems
getting everything up and running; the manual has full instructions that have
been “Grandma Tested”. So, enjoy!
I
will repeat what I wrote in the addendum; “situational awareness” is critical
for success in using this indicator of the 2 EMA’S that are added to “The Tunnel Method”. “Chop” as everyone who has traded for longer than 5 minutes
knows, is the “killer” limitation anytime EMA’S [exponential moving averages] or
MA’S [simple moving averages] are used in a trading method or algorithm; that’s
the bad news. The good news is that “chop” is somewhat predictable, and that
when the market slows, or refuses to expand a daily range during the trading
day [especially early], you can pull back and avoid the “chop”. Markets go
places eventually, so patience and discipline are always needed when using MA’S
of any type, form, or duration.
A
good indication of potential “chop” is the range of the EMA’S in the M1; if
they are tiny [less than 2 PIPS], clustered around a price, it’s a good time to
ask yourself if “chop” has taken over trading for the moment; also, please be
aware of the slopes of the critical white & aqua lines in “The Tunnel
Method”, cuz they are your clues to the probabilities of the market going up or
down.
Remember
that probabilities are simply that; not guarantees. The power of the “special
indicator” is its generation of winning trades over a series of trades within a
trend, which until the trend changes will generate 80%+ winning trades. That
doesn’t mean the first or second trade MUST BE A WINNER, simply that out of 5
trades, 4 should be winners, if the trend holds. This necessitates low to
medium leverage, so don’t make the mistake that any trade MUST be “the home run”
everybody is hoping for but never seem to get.
Finally,
also remember that any MA’S or EMA’S are “mean reversion” indicators; meaning,
they must eventually fail on crossover signals or else the market would be at “0”
or infinity. So far, I don’t see either anywhere. Just from anecdotal evidence
over my career, once you get past the third or fourth winning “special
indicator” signal, the probabilities appear to diminish drastically for further
profit moves, unless of course there is over-riding news to warrant some type
of tsunami type move. Here is where “situational awareness” is critical and a
knowledge of what is typical for a daily range under normal circumstances. For
example, if stock indices are rallying and USDJPY is rallying in correlation,
and the typical range for the day for USDJPY is 100 PIPS, and you get another “buy”
signal when the range is at 140 PIPS, the question is, is it wise to take the
position?
Of
course, the dirty little secret is, nobody knows; whatever algorithm rules you
dream up, the market will foil you cuz it simply must. On a probability
distribution curve, every time this scenario comes up, the solution will be
randomly distributed around a mean that “usually” occurs … so where are you
now? The solution lies in 1) common sense, and 2) your individual risk profile,
and what you are willing to risk finding out. Some will, some won’t, but there
isn’t any solution to the problem or question.
The
greatest asset “The Tunnel Method” with “special indicator” provides traders is
the fact that its greatest limitation is in plain view to see and avoid, and if
you miss a move it doesn’t matter cuz there will be infinitely more in the
future. Given a day or two looking at the market through the lens of the
algorithm, you’ll start to develop a “feel” for the turns and the various lines,
and also develop a “feel” for impending “chop”. And even a very tiny, partial
victory in that regards puts you way ahead in the trading game. So enjoy
everybody, and if you have comments/questions please email me.
Have
a great rest of your weekend everybody!
-vegas
OUR TURNKEY FOREX “PAMM/MAM” IS NOW
OPEN AND OPERATIONAL; SEE “PAMM/MAM MANAGED MONEY PROGRAM” IN “DOWNLOAD LINKS”
SECTION IN RIGHT HAND COLUMN FOR DETAILS [VIEW ONLINE AND/OR DOWNLOAD] AND
START YOUR JOURNEY FROM WHERE YOU ARE AT TO “ESCAPE
TO SUCCESS”!
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