Automatic Pattern Search

hi, can someone please tell me if this software can be set up to alert and scan for a certain divergence pattern?, or does it not work like this?


many thanks

hmmm, if im not mistaken this software creates code for metastock or tradestation and then you use it there...

Thanks Ron will experiment with the AND method and see if I can get better results.

Alex, thanks for the feedback. Do you look for a certain number of signals on the same bar such as number >= 3 for example, or wait a few bars for a signal in the same direction?

The general idea is based on using a number of patterns to indicate market direction only and then some other patterns to establish positions. This always increases profit potential. When using AND the first condition can can be shifted a few bars backwards to relate to a past signal while the second condition refers to a current signal.

I think you should now have a general idea of how this might work. You must also try to understand why your method is very simple and does not take advantage of the tremendous power of APS to find patterns.

I'm currently investigating the possibility of using a genetic algorithm with the operators AND, OR to automatically design systems for me using as input the APS patterns.

Ron

Ron,

Regarding "AND"ing patterns, are you essentially talking about "Split" patterns (from Harris' books) or something more general that allows bar spacing between patterns?

I'll understand if you don't want to get more specific but from reading this thread a few times both you and Alex seem to be experienced trading pattern systems. Comments from you guys are appreciated.

Thanks,

futz

I guess "split patterns" are just one kind that could involve ANDing. I think Ron was very generous indeed to even mention ANDing and I wouldn't expect him doing so, neither I would ask him going into more detail about his methods.

Here's is an example: you have a tool that calculates moving averages of all kinds. But there a zillions ways of using MAs. Some are too obvious and naive but others are very sophisticated and often successful.

In a similar way, APS can find many profitable patterns for you. Using the patterns in a profitable way depends on the specific strategy that employs them.

I guess confusion arises from the fact that each pattern code is generated by APS in the form of a complete strategy. I take that to be useful only for the purpose of backtesting the pattern codes in another platform rather than using them to trade as is.

Alex

Alex,

Thanks for the response and your comments on specific/complete strategy makes sense.

After re-reading the thread, there are a few things I'll add to my list of pattern-related stuff to look in to. I'm just getting started with mechanical systems development. As a frustrated discretionary trader, any tidbits are useful to a beginner like me and in that regard this thread has been useful.

Thanks,

futz