“I desire the proof of
the negative that can’t happen!”
The
Version 4 Algorithm “Quick Guide” is out and available, and while very brief
and concise, there are 2 important criteria I want to bring up; 1) the reason
it works and is powerful, is that it pinpoints the end of the corrective phase
inside a contra short term trend, and 2) it first waits for the “trend
followers” and moving average folks to “puke” and liquidate, and then on the
turn makes the call for a position; it simply uses the M1 against all those
using it for trend and “fades it” at the turn. So, in essence, the algorithm waits
for and wants the Moving Average [MA] folks using the M1 for signals to
liquidate on a trend change that is 1) the least effective of all time frames
and highly unreliable, and 2) takes the appropriate opposite position.
As
I have written before, there are “non-computable” problems in trading that
computers can’t solve; so, if for example, I tried to “code” this Version 4
algorithm into an EA [Expert Advisor], how do you define “at the turn”? Exactly
what is it? An engulfing pattern, a reversal, simply a color change, what? And
here is where the problems mount exponentially, cuz if you don’t “act” in a
literal second, the trade more than likely will be gone … there is “zero” time
for you to analyze the setup and make a decision … which of course can lead to
paralysis and that’s not good either.
Now,
we all know that there is absolutely nothing in the trading financial realm
that is 100% guaranteed; always have and always will be dealing in “probability
waves”. Over time, everything will happen, you just have to wait long enough to
see it. Having said that, in the “Quick Guide” I mentioned the algorithm’s
limitations, one of which is that when the M5 changes trend, and goes from one
side of the “Kumo Cloud” to the other, the position has a much higher
probability of loss than at other times. But, inside the short-term trend, it
gives some great turning points … some give the signals from the Version 3.2
algorithm, but whether they are present or not, if the M5 doesn’t change trend,
the M1 signal trade will be a good one from a profit perspective.
What
I’ve done, essentially, is turn the market on its donkey and ask it to prove me
wrong; I’m not asking for a continuation of a “breakout” trend on the M1 “Kumo
Cloud”, or try and follow any breakout of the traditional MA’s (2) that come
with the indicator on the MT4, that says to the market, “can you please continue a little further so I can profit”? With
probabilities greater than a casino in Las Vegas enjoys, I know what the answer
is … to ask the question is to answer it!
It
all starts with, “tell me what you can’t
do with ease? … what’s hard for you Mr. Market? … what and where is the highest
probability event inside a short-term trend to make a trade and profit? … and
what is it approximately”? And the answer is, all of the “fake out” breakouts on the
Ichimoku MA’s, the “Kumo Cloud”, and by default the other indicators that follow
right along and get people to make the wrong trade [e.g., MACD, RSI, etc.], cuz
what’s happening in real time is that the “big money” has the time, money, and computer
capability to know with certainty what the top 500 trading systems are doing in
real time, and the software “know how” to exploit traders without the trader
ever knowing he/she is being exploited by a large hedge fund or bank. [“What, you expected them to tell you first”?]
And
as we find ourselves [without anybody’s permission of course] in the “Central
Bank Paradigm” of trading now, the first question every trader should be asking
themselves is, “why has trading changed
and what can I do about it”? … but instead ask, “things have changed but I don’t know why … should I be worried about
it, or just trust the market? So, the Version 4 algorithm started out in
its genesis, not with “help me with better trend following signals Mr. Market”,
but with “show me … Mr. Market … what’s the most difficult thing for you to do
to NOT screw people, the least amount of the time”. Cuz when I know that, or
have a good idea of what it is, I can do the “OPPOSITE” and achieve consistent
success and profit.
And
really, that’s what lies at the philosophical heart of the Version 4 Algorithm
and how it is different than previous versions. Once I realized I didn’t have
to “reinvent the wheel”, and that the math was available inside the “Ichimoku
Kinko Hyo” indicator on the MT4, and that I could pick apart what I wanted and
discard the rest, things fell into place rather quickly.
Turning
to today’s market … “vapors” anyone? … seriously, I’m getting more than a
little annoyed with the Dow30 showing every single damn day that basically,
about 99% of every rally happens away from New York, when the market is easily
manipulated when everybody is asleep. Then, New York is a simple “protect &
defend” the manipulations higher, but no more … the action is disgusting, the
volumes pitiful, and the ranges along with volatility [VIX] the worst in 50+
years.
The
DAX30, on the other hand, exhibiting what a semi-free stock index market looks
like when allowed to go up and down. Not the best of days, as the market has
put in a solid reversal to the downside, inside a somewhat small range… going
in and out of the M5 “Kumo Cloud” twice with a short term trend change. A
little unusual, as reversals of this magnitude are somewhat rare in stock
indices [approximately 3% - 5% probability on any given day], but certainly not
a “one off” like a “double reversal” which are extremely rare and happen once
every 5 – 10 years.
In
total, I made 3 DAX30 trades today for the PAMM [yes, the Excel spreadsheet is
working now], 2 from the long side and 1 from the short side; on the second
long trade, the market trapped us with a “twofer”; 1) price on the M5 went into
the “Kumo cloud” thus going from bullish to neutral, and 2) price slowly
drifting away from my entry point on the M1 … in sum, took a small loss and
moved on. The other long trade and the short sale played out very well, so it’s
a profitable day … not as much as I’d like, but the fact is the cash market in
the DAX30 opened today and went straight up … after its high, its straight down
to new lows … even the M1 spent an enormous amount of time over, and then
under, its “Kumo Cloud”, and therefore there were only a few signals generated
before the cash close at 11:30; smaller than most days to be sure.
The
Dow30? … I’ve run out of adjectives to describe the trading action … it’s
simply “nonexistent”, and it’s pointless to mention what’s going on, cuz
nothing is going on that is worth repeating in front of children … leaving it
alone until something / anything happens that can get an M1 > than 3 – 5 points!
… I’m not sure there aren’t 15 minute intervals where you can’t even get
outside the 2 point spread … and the SP500? … worse than the Dow30, and to be
totally honest, I don’t know how anybody can be expected to trade this puppy it’s
so sickly. Two great markets placed into utter obscurity by central bank
manipulators hellbent on using the stock market as a social policy tool … the
utter hubris and pomp they place on themselves, that history may show them soon
what total fools they really are in retrospect.
Well,
here we are about 30 minutes from the close in New York, and it has been truly
one of those days in the Dow30 & SP500 you can forget and file under “waste
of time”. I don’t know how much worse the price action can get … it’s simply unbelievable
how pitiful conditions have become, especially when you realize that outside of
less than a handful of days, since April which is 4 months, practically every
day the Dow30 is higher comes from overnight “vapors” … New York is a disaster,
pretty much a nothing burger with more movement in the DAX30 when it is closed,
than the Dow30 when it’s open. But, here we are, and this historically low VIX
[50 + year lows, and an all-time record low the other day at 8.63; something
the market has never seen … ever.] has people lulled to sleep with complacency
and risk, so over loaded on the hype the FED “has their back” … “hi, I’m from the government and I’m here to
help”! Onward & Upward!
PAMM
spreadsheet directly below.
Time
for the beach! … “the ice cream King” and I are outta here … until tomorrow.
Have
a great day 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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