NF Swing Trading using Fractal AFL

[monkeybusiness]

A very valid point. Mentally preparing for a loosing trade will not let your gambling instinct come into play.

In trading, you donot have control over the outcome. Yet we can control two things. One is adhering to stop loss. Second is waiting patiently until target is hit.

In my personal experience, whenever stop loss is hit, i used to stamp on the ground with bitterness. It is a guess what would have been my trading results thereafter. Its repeated again and again until I found a way out.

When I put on a trade, I invite the price to hit my stop loss. Instead of negative emotions spurting up, i manipulate consciously a positive emotion to spring up as the price moves to hit my stop loss as i am mentally prepared to give up that amount. I am always prepared for 10 stop losses in a row and the spells of such losses spread into atleast 3 swings. When stop loss is hit finally I jump with joy. I have a reason for this ..... the price obeyed my wish to hit stop loss at the least. This process is repeated for several trades until i have become comfortable with stop loss hits. The movement I started guarding against bad trades with stop losses, the other side is opened up ie profits.

This is called rewiring your brain to act in tune with trading.

Very well said, need to make it a second nature:clapping::clapping::clapping:

 

[suri112000]

If I am not hijacking this thread, I am giving below an evergreen trading strategy for Nifty futures.

All you need is to plot Nifty futures 5 min chart, in panes. One should be line chart and other should be bi coloured bar chart.

Now look for highest peaks or lowest troughs made by line chart. Now look for "W" pattern at the troughs and "M" pattern at the highs.

Model trades

can follow.....two bar trailing exits.

I wish these should help to shape up your trading skills.

 

[suri112000]

There was no change in my efforts or results until I saw this golden and revealing poster of Ratan Tata few years back.

Can you see something relevant to your trading expectations?

 

[Silentshadow]

Great thread and amazing collaboration happening - a big thank you.
I have been having some problem running backtest on AMI it just wont pick the data from DB however I am able to plot charts by calling data through AFL. I need to circle back and check what is the problem and if I am able to get through will post some results.

We have lots of suggestions and parameter tweaks suggested by oldtrader, I am trying to anchor those over here for ease of reference and please correct me if I am wrong somewhere and I will edit the comment or may be oldtrader can post it on the first comment itself quoting best optimized parameter till date and it can evolve over time.

Would love to hear what other think? In the interim I am having a go @ it

*************** Acceleration & Max Acceleration parameters ******************

* Bank nifty Parameters are 0.0139 & 0.0185. TF is 7 min {Caution this afl may not suit bnf as per OT}

* Nifty Parameters used are 0.053 & 0.008. Time frame is 7 min {Suggestion is to take trades in options (CE or PE) running @ < 50 as per the signal generated}

* Crude Parameters 0.0005 and 0.004, on 5 min TF,
These can also be tried
1. 0.002 & 0.05
2. 0.006 & 0.05
3. 0.054 & 0.05

* Zinc Parameters 0.0965 and 0.002 , on 5 min TF , in Zinc

Parameters 0.0005 and 0.004, on 5 min TF, in Crude, on a sample data from March to August 2015, gave 1393 points in 69 trades.

Parameters 0.0965 and 0.002 , on 5 min TF , in Zinc, on a sample data from March to August 2015, gave 58.65 points in 62 trades.

The sample data was very small. If you have a bigger data , then cross check with the above parameters.

 

[oldtrader]

Great thread and amazing collaboration happening - a big thank you.
I have been having some problem running backtest on AMI it just wont pick the data from DB however I am able to plot charts by calling data through AFL. I need to circle back and check what is the problem and if I am able to get through will post some results.

We have lots of suggestions and parameter tweaks suggested by oldtrader, I am trying to anchor those over here for ease of reference and please correct me if I am wrong somewhere and I will edit the comment or may be oldtrader can post it on the first comment itself quoting best optimized parameter till date and it can evolve over time.

Would love to hear what other think? In the interim I am having a go @ it

*************** Acceleration & Max Acceleration parameters ******************

* Bank nifty Parameters are 0.0139 & 0.0185. TF is 7 min {Caution this afl may not suit bnf as per OT}

* Nifty Parameters used are 0.053 & 0.008. Time frame is 7 min {Suggestion is to take trades in options (CE or PE) running @ < 50 as per the signal generated}

* Crude Parameters 0.0005 and 0.004, on 5 min TF,
These can also be tried
1. 0.002 & 0.05
2. 0.006 & 0.05
3. 0.054 & 0.05

* Zinc Parameters 0.0965 and 0.002 , on 5 min TF , in Zinc

Nice to see your interest in developing the analysis. All the above are correct except the caution. I am not able to recall where I posted the caution about BNF. In fact those parameters have been suggested for BNF.

The parameters for commomdities have been optimized on a small data of 6 months period, so its relaibility will be doubtful. Whereas , the data for NF & BNF was optimized on 8 years data.

 

[Silentshadow]

My bad may be I misread it -- my apologies. Damn it I am not able to work around the back-test thingy on ami -- need to find some help. Let me ask around in other thread wont clutter this one

Nice to see your interest in developing the analysis. All the above are correct except the caution. I am not able to recall where I posted the caution about BNF. In fact those parameters have been suggested for BNF.

The parameters for commomdities have been optimized on a small data of 6 months period, so its relaibility will be doubtful. Whereas , the data for NF & BNF was optimized on 8 years data.

 

[oldtrader]

My bad may be I misread it -- my apologies. Damn it I am not able to work around the back-test thingy on ami -- need to find some help. Let me ask around in other thread wont clutter this one

No problem, You can post the back-test problems here. If I am able to help , I will definitely do it, Or , our AFL expert Happy Singh ji, may clarify your doubts.

 

[suri112000]

The averaging a loosing trade is very bad for people who are under capitalised. In other words, if you have unlimited capital, you can emerge as winner no matter what the market does with your trade.

Usually, averaging a loosing trade is not advised just because most of the traders are under capitalised and there is a loosing danger of wiping out if the trade goes in deep red for such people.

The problem in averaging is that you get wiped out when you get caught in a wrong direction and the price moves beyond limits to your undesired direction.

What about averaging a system?(not a trade!) Take any mechanical system which experiences bad patches how robust it may be.

Take for example, Fractal AFL. This system has generated 4205 points in 15 min TF from 01.01.08 to 28.03.2013 ie a period of 5 years 3 moths period. It is tested with a fixed stop loss of 200 points and target price of 400 points. After initiating a trade, if the signal reverses without hitting either stop loss or target price, we do reverse the trade. This system has shown a maximum draw down of 1180 points.

Doubling the trade size is recommended by TradeHunter in his 315 cross over system.

Taking the same cue, if we start doubling our trade size at every draw down of 500 points and exiting that extra trade at every 500 points profit, will increase the return of the system nicely.

Here the system is trend following. We are not averaging a loosing trade. We are just contemplating averaging the system when the system is in bad state. The system is bound to come back to profits on any day after a bad patch.

Fractal AFL has given 4 such draw downs to add to loosing system of 500 points each. Thus taking the total profit to 6000 points.

Thus the system has generated 28% p.a. on a capital of Rs.300000 with a maximum holding of 2 lots at given time.

Ponder over your thoughts!!

 

[suri112000]

................>>>>

 

[GMeyyl]

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@turi112000,

Charvita Charvanam Paashaana Praashanam.

This Thread is ,as Happy Singh ji rightly commented, is for Backtesting /Digging for Optimal Params and OldTrader is working so hard to give some EMPIRICAL study reports rather than some copy paste Charvit Charvan.

This Thread will remain Blessed if it is NOT HIJACKED .