This short article describes trading operations with turning point probabilities in fractal pattern scanners in MetaTrader and OptimumChart. Fractal pattern scanners are a powerful tool for forecasting forex and stock markets. This is a highly predictable tool for quantifying price actions on all waves of the chart. The fractal pattern scanner offers three main functions. The three features are:
1. Turning point probability measure (essential function that can be used on a daily basis)
2. Breakout and inversion trading signal detection by mother wave detection
3. Automatic gun angle (only for bonus features and options)
Measuring the probability of turning points is essential for daily trading. Turning point probabilities basically quantify the price action of the chart. Quantifying price actions gives you another level of trading experience. The ability to access turning point probabilities with a single button click is a really useful feature for everyday traders on the planet. In addition, the fractal pattern scanner provides probabilistic scanning capabilities across all time frames. You can also turn multiple time frame pattern detection on and off. Setting Detect Mother Wave = false allows you to run the fractal pattern scanner as a pure probability machine.
Turning point probabilities are a powerful tool that can be used as both reversal and breakout transactions within technical analysis. Watch this YouTube video titled “Breakout Trading vs Reversal Trading (Turn Support and Resistance into a Killer Strategy)” at the link below and experience breakout and reversal trading opportunities with support and resistance technical analysis. can do.
YouTube video link: https://youtu.be/UbORmOacKIQ
Mother wave pattern detection can be thought of as a statistical representation of Elliott wave theory. For example, the mother wave pattern detects patterns inside a pattern structure where small patterns are jagged inside large patterns, such as the Elliott wave pattern. You can use this pattern within a pattern to trade both reversal and breakout transactions. The fractal pattern scanner does a great job of automatically detecting these signals. When Detect Mother Wave = true, the fractal pattern scanner uses mother wave pattern detection to detect trading signals. Even then, both breakout and reverse transactions can be performed automatically.
- If you use breakout trading mode, set Breakout Opportunity Detection = true.
- If you want to use reversal trading mode, set Detect Breakout Opportunity = false.
You can also watch a YouTube video titled “Breakout Trading Signal Description” to understand breakout trading with mother wave detection.
YouTube video link: https://youtu.be/4XGuMIMaV6w
Further explanation of the mother wave pattern
The idea behind the breakout deal with Motherwave is to detect relatively young and fresh motherwaves. Those young and fresh mother waves are usually found in areas where the probability of turning points is low. So what does the “Price Probability of First Child” input do? This is a measure of how small the first child wave is when a mother wave pattern is detected. Even if this is difficult to understand, I think it is the size of the mother wave.
When First Child Price Probability = 30%, the fractal pattern scanner detects the first child wave with an amplitude less than 30%. Similarly, if you set First Child Price Probability = 50%, the fractal pattern scanner will detect the first child wave that is less than 50% in size. By the way, the detected mother wave pattern does not provide any kind of geometric regularity detection for breakout transactions. We have described the detection of some geometric regularities such as supports, resistors, and patterns of triangles and wedges. The same operation is required here as well.
In reverse trading mode with mother waves, you no longer need to control the size of the first child wave. However, you can control the size of the mother wave. The idea behind the reversal trading mode is to detect mature mother wave patterns that are likely to perform reversal behavior. Therefore, it is better to find these mother wave patterns in the high probability region of the probability graph.
For this reason, we set the price probability of the mother wave to 80%. You can set a higher number if desired. When using reverse trading mode, it provides an automatic Fibonacci extension to help determine the final turning point. This is a kind of geometric regularity that you can use. However, you can also use other geometric regularities taught in articles and books, such as harmonic patterns and Elliott wave patterns.
Here are some important tips. From our experience, some forex symbols are better in breakout trading mode. Some Forex symbols excel in reverse trading mode. To find the best trading approach, just set the bar to scan = 6000 and above. Find out how useful each trading mode is on the chart.
You can also use the Strategy Tester for this purpose. If you are using a strategy tester[トレーリングデータを使用した計算]= Set to true. This allows fractal pattern scanners to use subsequent data to calculate probabilities rather than a statistical approach (that is, a technical analysis approach). If you are using a technical analysis approach, the probabilities are calculated like any other technical indicator, such as a moving average indicator or an RSI indicator with trailing data. The statistical approach uses the entire data to calculate the probabilities.
The statistical and technical analysis approaches are not related to the latest patterns of trading. Only the historical pattern of your information matters. Personally, I prefer to use a statistical approach to calculate probabilities. This is to provide the same probability for all price series.
I think there are too many mathematical stories. Cut it out. If you don’t want to think about it, keep these two cases in mind.
A. If you want to display the history pattern on the chart, set “Calculation using trailing data” = false.
B. If you are using the Strategy Tester, set “Calculation with trailing data” = true.
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Fractal Pattern Scanner-Trading Operations-Trading Systems-October 18, 2021
https://www.mql5.com/en/blogs/post/746314 Fractal Pattern Scanner-Trading Operations-Trading Systems-October 18, 2021