TwC...Trading without Charts

[Lúidín]

Not so long ago..i came across an article by some well known trader in the financial circles..and..his speech was about trading without charts

my first thoughts were..what is this fool on about..everyone knows you HAVE TO use charts for trading

so..i started to think about this..and after a while could see merit in it for certain types of trading

this thread..is for anyone interested in trading without charts..no matter what instrument or timeframe you trade

let us see if any of us can actually do it..and no cheating..please..you will be asked to post some screenshots of how you trade without charts..should you wish to take part in the excercise

i will look for the article later and upload same if i can find it

 

[hhiusa]

Not so long ago..i came across an article by some well known trader in the financial circles..and..his speech was about trading without charts

my first thoughts were..what is this fool on about..everyone knows you HAVE TO use charts for trading

so..i started to think about this..and after a while could see merit in it for certain types of trading

this thread..is for anyone interested in trading without charts..no matter what instrument or timeframe you trade

let us see if any of us can actually do it..and no cheating..please..you will be asked to post some screenshots of how you trade without charts..should you wish to take part in the excercise

i will look for the article later and upload same if i can find it

Why do you have to use charts for trading? :smart:

I do not use charts. I have GUI-less API uses math.

I would like to see that article when you find it.

 

[Lúidín]

Why do you have to use charts for trading? :smart:

I do not use charts. I have GUI-less API uses math.

I would like to see that article when you find it.

nearly every text book on trading involves charting..after reading the article i spent about 5 to 6 hours doing up a chartless trading setup in excel..i then upgraded my laptop to win 10..i thought i had saved the exce file..but i can not find it now..i will have to search again..as the file was very interesting with no charts..i will look for the article also

my setup was for daytrading..as that is what i like best

 

[hhiusa]

nearly every text book on trading involves charting..after reading the article i spent about 5 to 6 hours doing up a chartless trading setup in excel..i then upgraded my laptop to win 10..i thought i had saved the exce file..but i can not find it now..i will have to search again..as the file was very interesting with no charts..i will look for the article also

my setup was for daytrading..as that is what i like best

I would be willing to do a quid pro quo of information. My Excel file is pretty big and it is a non-live version of the program I am having constructed. I am not sure what the file size limitations are.

 

[Lúidín]

I would be willing to do a quid pro quo of information. My Excel file is pretty big and it is a non-live version of the program I am having constructed. I am not sure what the file size limitations are.

i am still aware that vendors are watching..so we need to proceed with caution..we will post some screenshots of setup..but we will not upload any files..that will have to be in private..i think i found the article

 

[Lúidín]

this thread is going to require some thinking on the readers part..and some hard work on the traders part..there will be screenshots from various books..not trading related..to help explain the thinking behind TwC..as..to go where no man has gone before..so as to speak..requires some serious thought

all are welcome..the more traders partake the better..as the whole point of trading is to make money..by whatever means possible..with as small a risk as possible

 

[tomorton]

OK, trading without charts. But trading with what?

 

[hhiusa]

Volumetrics, Aroon oscillator and indicator to name a few. Volumetrics just looks a volume. The Aroon is a parametric equation based upon the stochasticity of stock prices. You use two numbers (days since highest high and days since lowest low). Firms spend millions to develop algo that use math.

There are many ways to trade without visual charting. Computers do not have eyes, they cannot see or need charts to place trades algorithmically. The chart that you see is just a GUI created for ease of use by humans.

 

[Lúidín]

OK, trading without charts. But trading with what?

Your brain:idea:

I have already done some work on TwC using excel, but as mentioned i may have lost the file, if so, then i will just have to do it again, which i will do if i have to

my style is daytrading..so my setup will be much different to say hh..or anyone else..even someone else who is daytrading..the only way we will know is if people partake

it is a worthwhile challenge..as a large part of my past development in excel was with numbers..the charts are but the final bit to see historical data more easily..but..if you are daytrading..then looking at historical data on a chart is not really of that much use..as you can have all the key numbers on the setup page..thus preventing your mind from wandering and pondering on things that do not really matter

this is why the article interested me..and why i spent some time on TwC using excel

 

[Lúidín]

this is a good read..and relative..well..i think so anyway

 

[hhiusa]

Your brain:idea:

Using their brain may be a foreign concept for some. The answer was almost too obvious so as not to be stated.

There is also the Black-Scholes asset price model. It can be tweeked to be used with many financial asset classes.

Vanilla Option Price and Greeks under Black-Scholes Model
http://www.quantcalc.net/BSV.html

A brief java code with the Black-Scholes formula.
https://github.com/bret-blackford/black-scholes/blob/master/OptionValuation/src/mBret/options/BlackScholesFormula.java

If you use exponential moving averages and calculate them yourself, then you are essentially using stochastic partial differential equations. Derivatives come from a term in calculus measuring a rate of change per unit time. In this case, the rate at which the stock price (S_t) at time t changes per unit time. The here is altered from the original. There are in fact, several derivations.

dS_t = μdE + dS_t-1 which is similar to EMA_t = μ * (S_t - EMA_t-1) + EMA_t-1
dS_t = the derivative of the stochastic process mapping a financial instrument at time t
μ = constant drift or a smoothing constant. Ideally you will need to optimize this value, possibly with some form of quadrating programming.

 

[Forexmospherian]

Volumetrics. Aroon oscillator and indicator. Volumetrics just looks a volume. The Aroon is a parametric equation based upon the stochasticity of stock prices. You use two numbers (days since highest high and days since lowest low). Firms spend millions to develop algo that use math.

There are many ways to trade without visual charting.

Agree with you hhiusa - and that makes a change.

I can do intraday FX trading without any charts - and was shown how to do it by a guy called Dr Sivaraman about 5 -6 years ago. He was a professor at an Indian University for over 25 years and specialised in statistics

Its all based on price levels and time.

I can also trade with naked charts - but I know in both cases I am not so successful as when I use my own charting method again using time in the concept

Were I do differ with you though hhiusa is that trading is not simply a science - and no matter how good you are at maths and working out standard deviations etc - it will not get you any more accurate than maybe a 75% win ratio.

This was proved to me by a Professor Brian Twomey ( yes from the good old USA ) who got taken to the cleaners in 2012/13 when he did not foresee the weakness in the Yen crosses and was utterly confident price would retrace - all based on SD calculations. It did after a few thousand pip increase - but then if you don't use stops and use only 0 00001% stake size you probably are OK - and then when you do win and make just 14% in a year gain you cannot grumble ( lol)

Regards

F

 

[Lúidín]

Using their brain may be a foreign concept for some. The answer was almost too obvious so as not to be stated.

There is also the Black-Scholes asset price model. It can be tweeked to be used with many financial asset classes.

Vanilla Option Price and Greeks under Black-Scholes Model
http://www.quantcalc.net/BSV.html

A brief java code with the Black-Scholes formula.
https://github.com/bret-blackford/black-scholes/blob/master/OptionValuation/src/mBret/options/BlackScholesFormula.java

many are unaware..for obvious reasons to me..and a few more..that this thread has the potential to save them years of wasted time..and lots of money

i am not saying this TwC is the holy grail..i am not even saying it will work out ok..at this stage..but i am saying..that if it works out for daytrading..which is what i will be testing..then it can do as i say it might well do

who wants to talk about silly lagging indicators and squiggly lines..there are millions of text books and pdf's with that same old stuff..if you want to make big money..then you need to think differently to most..and be prepared to follow up on good leads when you come across them..no matter who the leads are from..for it is the information that is important to the individual..not the person who wrote it

 

[hhiusa]

Were I do differ with you though hhiusa is that trading is not simply a science - and no matter how good you are at maths and working out standard deviations etc - it will not get you any more accurate than maybe a 75% win ratio.

This was proved to me by a Professor Brian Twomey ( yes from the good old USA ) who got taken to the cleaners in 2012/13 when he did not foresee the weakness in the Yen crosses and was utterly confident price would retrace - all based on SD calculations. It did after a few thousand pip increase - but then if you don't use stops and use only 0 00001% stake size you probably are OK - and then when you do win and make just 14% in a year gain you cannot grumble ( lol)

Regards

F

Show me where this was proven. I will think for myself. I have higher than a 75% win ratio. I have been posting trades with Lui in the live trades thread.

 

[Lúidín]

this thread will also question the common basic concepts of trading..using the past to predict the future..new approaches will be investigated and tested where possible

 

[hhiusa]

If people think that the past serves no purpose and is not an indicator of the future, then what is the purpose of historical data? Why is that you think firms spend so money trying to keep accurate historical data.

I was watching Bloomberg in early December, they said "keep an eye on FANG stocks, they are expected to underperform or even see negative returns that month as they have historically done so."

FANG = Facebook, Apple, Netflix, Google

 

[Lúidín]

If people think that the past serves no purpose and is not an indicator of the future, then what is the purpose of historical data? Why is that you think firms spend so money trying to keep accurate historical data.

I was watching Bloomberg in early December, they said "keep an eye on FANG stocks, they are expected to underperform or even see negative returns that month as they have historically done so."

FANG = Facebook, Apple, Netflix, Google

you raise a vg point hh..for..what most people do is well known..but..only a small few know the reason why most people do what they do:idea:

if you want to use your brain to make money..then..does not common sense tell us we must become aware of how our brain functions..how can it be any other way:idea:

if you saw 100 people jumping off a bridge..would you jump in just because they did :whistling

think of where the red dot is..until you can feel it..then..you will know what is happening when you don't take your loss..or when you take your profit

 

[Lúidín]

i mentioned recently in a diff thread about a hft trading algo i came across that was tested and resulted in over 30K profit with about 300 trades..with around a $100K account..looks like i was wrong

i will post details here..as it would be considered TwC

added some details for when the shi.t hits the fan

 

[hhiusa]

you raise a vg point hh..for..what most people do is well known..but..only a small few know the reason why most people do what they do:idea:

if you want to use your brain to make money..then..does not common sense tell us we must become aware of how our brain functions..how can it be any other way:idea:

if you saw 100 people jumping off a bridge..would you jump in just because they did :whistling

think of where the red dot is..until you can feel it..then..you will know what is happening when you don't take your loss..or when you take your profit

That is also a very good point. That is why I majored in biochemistry instead of finance.

Practical applications of optimization in finance
http://cbio.ensmp.fr/~jvert/teaching/2006insead/slides/8_applications/applications.pdf

It is a very interesting rudimentary read. I can help explain the math if anyone is interested. It looks more complicated than it is.

 

[Lúidín]

That is also a very good point. That is why I majored in biochemistry instead of finance.

and here was me thinking you were a fool:cheesy:

some years ago i bought a book called..mathematics:from the birth of numbers..i got into the first few chapters,,then i stopped..i still have it..looking at the cover right now..but i very seldom use it

what i have done..is..added very high importance to time in my trading..this allows me to reduce my dependency on the maths..as..time is of equal importance as mathematics..if not more important..for..are maths not used in the calculation of time!