Trading eminis with cycles

[theplumber]

Originally posted by theplumber
Not a bad forecast for the whole week. On the right was the chart I posted yesterday with the model showing a nice rally and me saying "Not bad so far if Wednesday is an up day", well that was an understatement. Talking to my trader friends of mine during the day we all said that $52 oil, FNM mess and possible terror in front of the elction doesn't make them sell then their going to lining up to buy'em. In fact this was an interesting tid bit of info I read today "On Sept. 2nd the SPX crossed back through its positive
trending 200-day moving average after being below it for 30
trading days. This has only happened 6 times since 1950. The
SPX was always higher 60 trading days later with an average
gain of 7.8% - so far it is up 1.5%. " --Snoop Tony Dwyer

On another note, I showed some stats on when the market bottoms in August during an election year the last time was 1920, and Nov was the worst Nov on record (or something like that I'll have to dig around for the actual numbers) and this could be playing out. A 5% Nov dip looks right after squeezing to 1170 or so. Dec of course could be a nice snap back with year end bonuses on the line. Always amazes me how most Hedge funds are not hedged but instead are long bias funds.


One last edit, the Friday action looks like a sell the news or maybe a bad number I don't know but the cycles point down. It isn't in the screenshot I gave above.

Yesterday and this morning is the down cycle I spoke of above. This is an interesting cycle projection for the day and will be updating before the open but shows some interesting possibilities to maybe buy.

[theplumber]

Just a follow up this is the original day only model anchored from yesterdays close. This is how I use both models to trade goverment numbers before the bell and then looking for a match after the bell rings. The easy money has been made so be careful going into the close. I don't want to sound like a kook but with the debate tonight I can only guess what "could" happen, even though the stats say a -1% close.

[theplumber]

Someone asked me yesterday how to read the tape. Seems there are thousands of variations based on peoples opinions as to what tape reading is. I don't have the answer I said but I showed what I do to look for buying and selling interests within the flickering ticks. The biggest problem is not getting confused by information overload. Within the cycles and PHI (for the Ewavers and Fib people) stock/futures have to be moved, it just doesn't happen by itself. Intraday trading is much different than swing or position trading so knowing when people are moving stocks/futures is vital to me. It all comes down to timing, plain and simple. This chart below is what I made up (this was a personal friend of mine so I took a little more time and effort). The MarketDelta software can show exactly what time a box is but it can't be shown in a screenshot, you just have to trust me on the matching of the times. Of course this is overly simplistic but it gives a sense of what I'm looking at along with my cycles.

[theplumber]

I'm sticking to the cycles and playing long until the election, then looks like all hell breaks loose

[theplumber]

Another perspective, but still the same. What happens in Nov? Kerry upset? Terror? $100 oil? RedSox win the World Series ?

[theplumber]

I don't have a subscription to FOREX data, so all I can use is $DXC. The first is the weekly. Every security has cycle characteristics that you learn over time along with how the software interacts with the data. So having alot of confidence in these models I don't have. I played with the models and different settings for about an hour and this is what I came up with. This is the weekly and the daily is above. Some models I've seen for FOREX are here http://www.forecasts.org/euro.htm http://www.alphee.com/reading_room/r...sound-euro.htm but someone who I believe has some excellent models and has branched out into FOREX is this guy [email protected]

[theplumber]

Daily $DXC

[SERGIO.M]

It's very diffucult to find the right setup. I will keep trying, hoping to find the right one.

Which setup did you use in your last charts?

[theplumber]

Originally posted by SERGIO.M
It's very diffucult to find the right setup. I will keep trying, hoping to find the right one.

Which setup did you use in your last charts?

Your chart setup looks good to me so far. One of the tricks I've done after finding a good set of settings is to update exactly when the model cycles "invert" or just go flat out wrong. The data window is extremely important, and is a function of what it is being analyzed. Because of the choppy action of FOREX I would never go bigger than 512 and maybe only use 128-256, it depends on the time frame you trade (daytrade or swing/position trade). I would make the persistency filter 0 and set a moving average (this more or less will filter out the bad cycles) and then play with the cycle length. The chart below of $DXC is with the folowing settings with the XT model.

256 data window
34 max cycle length (this is some of my secret to success, I've used half the dominant cycle length and made it the max cycle length, gives better timing , but doesn't work for all instruments so use with caution)
min cycle length 3
MA type simple (only use weighted with volume securities and not index type instruments)

I used the regular projector in the charts below but don't remember the settings, this tool has many different settings and you will have to spend a day finding the right settings. Trust me it will be worth it.

One last thing I didn't see the arrow you had. You don't want 1.0. I repeat you DON'T want perfection, that is curvefitting. The markets are non-linear with periods of linearity but modeling these small periods will make the whole model wrong. You need to research curvefitting to understand what I mean when it comes to modeling nonlinear markets.

[SERGIO.M]

Originally posted by theplumber
Your chart setup looks good to me so far. One of the tricks I've done after finding a good set of settings is to update exactly when the model cycles "invert" or just go flat out wrong. The data window is extremely important, and is a function of what it is being analyzed. Because of the choppy action of FOREX I would never go bigger than 512 and maybe only use 128-256, it depends on the time frame you trade (daytrade or swing/position trade). I would make the persistency filter 0 and set a moving average (this more or less will filter out the bad cycles) and then play with the cycle length. The chart below of $DXC is with the folowing settings with the XT model.

256 data window
34 max cycle length (this is some of my secret to success, I've used half the dominant cycle length and made it the max cycle length, gives better timing , but doesn't work for all instruments so use with caution)
min cycle length 3
MA type simple (only use weighted with volume securities and not index type instruments)

I used the regular projector in the charts below but don't remember the settings, this tool has many different settings and you will have to spend a day finding the right settings. Trust me it will be worth it.

One last thing I didn't see the arrow you had. You don't want 1.0. I repeat you DON'T want perfection, that is curvefitting. The markets are non-linear with periods of linearity but modeling these small periods will make the whole model wrong. You need to research curvefitting to understand what I mean when it comes to modeling nonlinear markets.

Thank you my friend

[theplumber]

Weekly model playing out well

[SERGIO.M]

Today I found this setting

[theplumber]

Originally posted by SERGIO.M
Today I found this setting

[theplumber]

An example in backtesting to get maximum confidence in your settings.

[SERGIO.M]

backtesting

I think it gave a good result, I will keep on my research.