The idea behind this blog

Do we all search for a holy grail in the Forex market? Do we all search for an edge?The answer is definitely Yes !!!

This blog was born because of my desire to free myself from the ideas and toughs in my mind in a systematic way. The only way to get out was to write them down and make them public. As this blog will be not an ammunition for a spamming attack if you find it it will be not a chance but in purpose. I hope you will make a good use of the ideas and have fun. There are another three blogs. One blog is an experiment for trend following micro hedge fund (with 100 USD a good joke isn't it) and the other concerns strategies for day trading the forex market. Those three blogs form a whole, but this blog is more general and discuss general ideas and theories.

There is an ongoing continuous research, some of the brightest human researchers are working on that. There are great traders, programmers, mathematicians, economists they all work on the same topic.

It is not possible for a simple human perspective to be in the same time, mathematician, bright program coder, a great speculative trader with innovative ideas. We all can have some domain of competence but to really have an edge we need to be all that. Is it possible? Are we super humans heroes? Of course it isn't possible but we can use the knowledge and the brainpower of all them to have a hack of the market. That hack cannot beat all the times the market but we could exploit opportunities if we have a back door on the market.
During my research I found on the net a lot of interesting materials that I really want to share with my friends. That is why I created this blog.

1. The idea is that we have to combine many, many different approaches in order to have an edge. If we use only one trading strategy, my opinion is that we cannot have an edge in the Forex market.

2. The second idea is that we need as much automatic analysis as possible. We want our brain to make a synthesis and not an analysis. This idea includes the idea that we need a reference trading system.

The system I have chosen for me at the beginning was the Bill Williams trading system. I really like it and I made some personal improvements. But still not profitable. After that i have read the e-book FXWizard by Rob Walton. This system was easy to understand, logic, beautiful but unprofitable.

Nevertheless it was not profitable at all in day trading.

After that I have visited every forum you can imagine but ... you know the story.

So after much research, this sounds familiar, I had some ideas that I wish to share in this blog.

I decided to get out of the conventional wisdom and common sense and to explore new territories. As Dr. Bishop in Fringe says: Accept the impossible and maybe you could touch the truth.

I challenge the conventional truths like

-the technical analyse patterns use the psychological moods: a wrong concept

in fact the patterns can have different origin. My theory is that it is wrong to use the technical analysis theory developed from the stock market and apply it automatically in the Forex.

The big figures on 4 h times frame are mostly due to market sentiment, but they can be a pure chance. But once they are formed everybody looks at them and it becomes really freaking risky to day trade them with a lot of leverage and big lots.

There are other figures that are due to the change of the volatility based on the daily session.

In that sense a pattern is cause by the volatility. And the daily volatility has cycles that can be observed, statistically quantified.

The figures on the small times frames can have different origins. They can be random or provoked by some cycle chaotic attractors or again created by intra-day volatility collapse .

-the usefulness of the Elliott wave principle as a wrong concept in the modern Forex markets

etc.

The Elliott wave principle has its source in a simple game theory concept for the balance of power between bears and bulls, provoked by the balance between the human emotions of greed and fear. Dear readers today in a market dominated by the algorithmic trading and high frequency algorithms don't you think that the premises are missing. THEY ARE NOT THERE.

The model was interesting it was based also on statistical observation, that the rise continues longer than the fall. But now and today it does not holds as a predictive instrument.

My opinion was that if it is useless ot can do no harm as you use it to find an entry solution in the trend. But please don't be eaten alive and do not use it to make a counter trend prediction.

But the gurus, as Prechter or Neely find themselves very smart and use it to predict the market reversals. Well when you make such a prediction sometimes you will be correct. And then the crowd sees only the last "prediction", but those before are easily forgotten. But Neely saw that there was something missing and recognized that his predictions are not correct more than 50 % of the time. So he uses a secret method calls a River theory, that has nothing to do with any wave principle.

The main ides in this blog us the use of market observation of the fractal dimension of the price times series as a leading concept.