Quadra Safe Trading Strategy - I

[SavantGarde]

Hi SG,

In BANKNIFTY Futures chart posted above by you, though there was a BUY trigger on 18-4-2012, it was never confirmed by the later candles (None of the later candles have taken out the trigger candle high. The High of trigger candle on 18th April happens to be highest high in last two weeks). Therefore, there was no trade and the Initial SL getting triggered on 27-4-2012 does not arise. Thus Quadra has protected us from taking a wrong trade.

-Anant

Hi Anant,

As far as data that I download from 'Getbhavcopy' for Equity & Futures, on the 17-04-2012 BNF made a High of 10658.00 which had Triggered a BUY and subsequently on the 18-04-2012 it was taken out by making a high 10674.80 thus making it active (marked on the chart by vertical green dotted line) where the BUY was placed one point above the high of 17-04-2012 @ 10659.00..... but the problem as I realised in hindsight was the 'Initial S/L' which should have been a little lower than that of 29-03-2012 instead of a point lower than that of 11-04-2012.

Reason.... that a point lower than Low of 29th would have been the correct Initial S/L is because we have a gap-up opening on the 30th March....therefore high probability of closing the Gap should have been taken into account by me....and that is where I made the grave error.....!!!

This is one of those instances of Gap-up.....which will perhaps need to be looked at closely, next time it happens....can't remember I came across such an instance while manually backtesting NF...!!!

SG

 

[timepass]

Hi SG,

In BANKNIFTY Futures chart posted above by you, though there was a BUY trigger on 18-4-2012, it was never confirmed by the later candles (None of the later candles have taken out the trigger candle high. The High of trigger candle on 18th April happens to be highest high in last two weeks). Therefore, there was no trade and the Initial SL getting triggered on 27-4-2012 does not arise. Thus Quadra has protected us from taking a wrong trade.

-Anant

I guess, in that case, we call the 18-4-12 candle as the signal candle, and the candle high (+ filter) as the buy trigger.... what do you say ?

 

[SavantGarde]

I guess, in that case, we call the 18-4-12 candle as the signal candle, and the candle high (+ filter) as the buy trigger.... what do you say ?

Hi TP,

17th was a clear BUY which got triggered on 18th....just because it hit the Initial S/L there is no point looking back to see if there was any mistake with the trigger....have pointed out my error of Initial S/L... Yess....Initial S/L in most entries is quite deep....but manual backtest of NF had indicated only couple of instances where the Initial S/L had Triggered....!!!

One of your earlier posts I went through this evening was regarding the Dates of Entries and Exits... yes I have managed to compile that in the excel..& will upload tomorrow after re-checking the same...!!!

SG

 

[sunilrhs]

Dear SG,

What I feel is, since this strategy works on EOD, then the scenerio of SL hit of BNF does not arise as it never closed below the SL on any days. Even if BNF goes below SL during the start of the day but I feel one should wait till 3.25 PM for the confirmation.

And same for the entry also, if BNF stays above the signal bar high throughout the day the entry would be valid.

What Say????

 

[SavantGarde]

Dear SG,

What I feel is, since this strategy works on EOD, then the scenerio of SL hit of BNF does not arise as it never closed below the SL on any days. Even if BNF goes below SL during the start of the day but I feel one should wait till 3.25 PM for the confirmation.

And same for the entry also, if BNF stays above the signal bar high throughout the day the entry would be valid.

What Say????

Hmmmm.... Sunil.... Nobody likes their S/Ls getting triggered especially if it's going to give you a loss.....but as per the System.... that I have manually backtested.... one is suppose to place the Initial S/L or Trailing S/L during Pre-open... or as an AMO.... if it gets hit during the session...so be it.... !!!

But..I have made it clear in one of the earlier posts... System gives an Investor/Trader enough slack....to tweak as per their comfort & understanding......!!!

SG

 

[timepass]

Dear SG,

What I feel is, since this strategy works on EOD, then the scenerio of SL hit of BNF does not arise as it never closed below the SL on any days. Even if BNF goes below SL during the start of the day but I feel one should wait till 3.25 PM for the confirmation.

And same for the entry also, if BNF stays above the signal bar high throughout the day the entry would be valid.

What Say????

Pretty good idea !! :thumb: Like 315, we could consider positions at 3.25pm.

Also, it may be a good idea to define "filters" for entry as well as SL, to evade any spikes/ sharp movements of any kind.

 

[hmp]

DEAR LVG Sir,
will u post new updated afl?

 

[lvgandhi]

DEAR LVG Sir,
will u post new updated afl?

I have not updated the AFL any further as I am not clear about certain points which are raised in next post.

 

[lvgandhi]

Hi Anant,

As far as data that I download from 'Getbhavcopy' for Equity & Futures, on the 17-04-2012 BNF made a High of 10658.00 which had Triggered a BUY and subsequently on the 18-04-2012 it was taken out by making a high 10674.80 thus making it active (marked on the chart by vertical green dotted line) where the BUY was placed one point above the high of 17-04-2012 @ 10659.00..... but the problem as I realised in hindsight was the 'Initial S/L' which should have been a little lower than that of 29-03-2012 instead of a point lower than that of 11-04-2012.

Reason.... that a point lower than Low of 29th would have been the correct Initial S/L is because we have a gap-up opening on the 30th March....therefore high probability of closing the Gap should have been taken into account by me....and that is where I made the grave error.....!!!

This is one of those instances of Gap-up.....which will perhaps need to be looked at closely, next time it happens....can't remember I came across such an instance while manually backtesting NF...!!!

SG

Dear SG,
As per my data directly from NSE bhav copy directly downloaded EOD from NSE, buy trigger has happened on 16/4/12. See the chart attached.

Any reason for not considering 16/4/12 as buy trigger as all wilders MA and EMA are in order.
Data of close is EOD adjusted as per NSE and displayed in bhav copy, not last traded value.

Now I need a few more clarifications.
You are using a filter of 1 for above trigger. Any specific reason. Should it not be better it is placed on some % of ATR.
Second what is the filter below SL in case of long?
Further I am unable to understand connection of SL and gap.
Once a higher high on 13/4/12 and higher low on 11/4/12 is formed, why low of 11/4/12 ie 10060 can not be considered as SL
Can you please explain?
Or give a link to that if it is explained earlier.
Sorry for the trouble.

 

[timepass]

hmm.. LVGandhi.. using ATR to determine the filter. It's an idea. Can you put more thought into it ??