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Zigzag Circles Strategy Test 1st April → 6th June@LonesomeTheBlue has recently published an interesting script LTB Zigzag Circles . I got curious about its performance, so I tinkered out a strategy and tested it out on GBPUSD. I will use ZigZag Circles with a period of 14 on a 30m timeframe. Furthermore, I will utilize round levels to place my entries, exits, and stops. When there is a bullish signal: ► a limit entry is placed at the nearest-below x000, x200, x500, or x800 level. ► a stop-loss is placed halfway through to another such level below. ► a take-profit will be at the nearest x000, x200, x500, or x800 level to the upside. When there is a bearish signal: ► a limit entry is placed at the nearest-above x000, x200, x500, or x800 level. ► a stop-loss is placed halfway through to another such level above. ► a take-profit will be at the nearest x00, x200, x500, or x800 level to the downside (check the first picture for clarification, round levels are shown in gray) #1 A first entry signal at 17:00 Look at the limit order. A limit is right before 1.38200, the exit before 1.38500, the stop-loss between 1.38000 and 1.38200. #1 A first order is closed in profit in roughly 12 hours #2 A second position opened and closed according to rules #Not All Entries Trigger Obviously, I didn't leave the entry orders hanging out there forever. #3 A first loser This is how a lost trade looked like. #5, #6 A little problematic area This is a problem you might encounter with LTB Zigzag Circles. Signals point in both directions... I wouldn't take the long one as the signal is far from my level, but during the backtest, I follow the rules. Hence a win and a loss. #8, #9, #10, #11 a series of losses in a consolidation area When the price keeps on contracting, there might be several false signals in a row. Even though you may still see some respect for the x500 zone, the bounces are small and not enough to reach the profits. In real trading, the entries could be identified as unconvincing and avoided. #14, #15 Two winners in a row Although the stop-loss was dangerously close to where the price once was for the first one, this is how the winners in a row might look like. #22 Another problematic situation Lastly, I wanted to put attention to this imaginary trade. The very point of using limit orders in this test is to make sure I have enough time to get the signal and evaluate its quality. I do believe, there wouldn't be enough time to open a position from a level designated by rules. So I put it on the nearest one below. I know I wouldn't want to take that trade after I was notified at the candle's close. If you would, count it as a loss. Conclusions 37 trades were open since the beginning of April, out of which 44% were profitable with an accumulated profit of 1141 ticks . When backtesting, I like to subtract 3 pips from every trade to give it a better feel of the real world. You make mistakes and you also pay spreads and fees. If I subtract 3 pips from every single trade, the strategy will still be profitable, but barely. It's 91 ticks only. Of course, the real spread is smaller than that, so this is a good result also. Lastly, I saw the price to continue in the direction of the trade far exceeding its original take profit. With advanced trade management (which can not be backtested easily), profits would be higher. Remember, that 37 trades is a narrow sample size. It is enough to give you an idea of what parts of the strategy to improve. But for accurate statistics, you should test your strategy 180+ times.
by OrcChieftain
6
ZIGZAG WAVE (IV) complete. WAVE (V) to target area: 25431-25262Ok, so WAVE y did not turn out to be an impulsive wave but more like a sideways correction which ended in 27478, which completed the ZIGZAG correction for WAVE (IV) that I had correctly predicted on my last post. Now starting the beginning of WAVE (V) from 27478, BITCOIN is underway going down $2k to my target area of 25431-25262 to a very IMPORTANT PIVOT POINT making the end of WAVE (V) of Ⓨ of A, and the start of a very BULLISH corrective WAVE B which will go up about $3k to my previously projected target area of 28998-28687. Please comment below to let me know what you think. I am highly interested in your opinion.
BITSTAMP:BTCUSDShort
by jmlopez2
2
Zigzag down!I bet my money on further price declines as I believe we are seeing a zigzag correction unfold. I project its wave B to reach a maximum of 50% of wave A because the latter was rather steep and, as Alexander Elder has wisely put it, "a man who's fallen from the second floor will not walk again for a while." That being said, I'm also conservative as to how far wave C will extend, so I've set my goal to USD6000.00 and will gladly let it run if it extends. If that's the case and wave C is 161.8% of wave A, there'll be a possibility that wave C is then wave 3 of a 5 wave impulse one.
BITFINEX:BTCUSDShort
by barrbudo
Possible Wave 3 of 3 to follow completion of Wave 2 (ZigZag)A Wave 2 ZigZag has completed at the .618 retracment of Wave 1 which is a strong indication the correction has complete. The price has already made a bounce from this level and seems to be in a correction which has probably has further downside before the up move. This initial bounce could be the beginning of a Wave 3. The larger picture shows this Wave 3 could be part of a Wave 3, this means it is likely going to be a strong impulsive move. Entry Level: I will be setting a conservative pending entry at the break of Wave B of the ZigZag. Stop Loss: At the extreme of Wave C of the ZigZag. Target Level: The target marked on the chart is a 1.618 multiple of Wave 1. There is potential for a more upside after this level. As always I will monitor pattern over setting a hard take profit.
Long
by ciano1993
GOLD (XAUUSD) 30min - Zigzag up ideaI think we are going to test 1762 - 1790 area with a "zigzag" ABC wave (5,3,5), inside a bigger C or E wave. So the idea would be to long on the B completition beetween 1713 and 1699 (ideally the best would be around 1706). Below 1699 probably this count is not a valid prediction, so SL can be tight and we will have to look to something else in terms of waves. Soon i will post an higher timeframe idea of the upper cycle in wich this should be a part.
OANDA:XAUUSDLong
by fra978
1
USDJPY ZigZag Long Trade Setup - Potential x3 RRHi Traders! It has been a while here. Check out my current trade setup on USDJPY. Price has completed a simple zigzag which might be part of the circled wave iv potential triangle pattern. Wave c equals a and it's also testing the lower boundary of the parallel channel. The breach of the upper green level will be our conservative entry. Market has presented an early entry from the lower green level. The price must stay above the red invalidation level for this setup to remain valid. What's your view on UJ? Let me know in the comment. Thanks, Veejahbee.
Long
by Veejahbee
1
NEM ($XEM): Triple ZigZag vs. Impulsive Wave-1 with extensionXEM is difficult to predict now. I can see a few possible movements: a) Impulsive Wave-1 with Wave-1 extension = I expect retrace to 1600sats zone. b) Triple ZigZag Correction = retracement to 1900sats zone So, I'm going to wait how XEM manages re-test of 1900sats zone. Then the next price movements will be more clear. Generally, I don't expect that XEM will go lower than 1400sats. If you like my charts, pls. hit that "like" button, follow me or leave your comments. Thank you!
by AsBobbyDigital