Kools tools -square root fun

[dilesh23]

the 50 % rule i think is his new weapon of choice, good luck in finding out any information from him abot it if you search for the threads hes started, youll be in for some beating around the bush

 

[RedGreenBen]

this thread will address another neat little trick i use in scalp trading.

Let me play Devil's advocate for a moment or two (trying to generate a useful discussion not to knock your posts!)...

I have a real problem with this type of 'rule' as if it is entirely empirically based (I assume it is?) then it requires some pretty clever analysis to demonstrate any value or not.

"Pretty clever analysis" is not posting a few charts that show when it works so long as you give it a few pips leeway.

I am especially skeptical when the distance between levels is not >> the error that you seem happy with as a successful application of the tool, it is very easy to 'squint' and see all kinds of magic! I know that no tool is perfect but that isn't a valid argument to assert that it does have value (which has to be the key test).

Even any replies to this thread are likely to be 'self selecting' as there is undoubtedly a bias towards replies where it has worked compared to cases where it hasn't.

(Still being Devil's advocate...) I would even go as far to say that unless there is a proper piece of analysis to back this up (the trading equivalent of the double-blind placebo-controlled drug trial) then it is about as useful a post as me telling you about my tool that requires the averaging of the temperatures in NY and Tokyo at market open and close.

As I say, just being healthily skeptical and treating everything with the caution it deserves. Note also, I wouldn't have bothered writing this much if I though you were just barking mad!

Ben (all above text in polite font!)

 

[koolblue]

Actually , BEN , i agree! I said this was just for fun! I personally use my own price projections and cycles to trade and would never advocate trading off of the above for the reasons you stated. Nonethe less, i do find it interesting.

 

[RedGreenBen]

Actually , BEN , i agree! I said this was just for fun! I personally use my own price projections and cycles to trade and would never advocate trading off of the above for the reasons you stated. Nonethe less, i do find it interesting.

Your interest is, err, interesting.

The problem is that 'interesting' and profitable are very different (As I am sure you know). Thanks though for your comment, perhaps someone will have enough interest to do a bit of analysis, although to save T2W from another lengthy post I won't go into the reasons about why that would be so difficult with this type of rule!

Ben

 

[hwsteele]

I used to use square roots and the square of nine allot. I have replaced most of what I used to use it for with the simple measured move.

P.S. I still think the square of nine is a great tool.


Do you mind me asking what you are using instead?

No I don't mind at all. The square of nine is a "fun" tool that works great sometimes and not so great other times. Also, it works better on some markets than others. The reason I used it was to get price levels(or time cycles). After looking at charts for a long time I realised that the "simple measured move" was just as good and in most cases better than the square of nine because the levels you get are related to the market you are working with at that time.
The method is simple also. You find a high or a low and measure the first wave from that high or low. Then you use that distance in multiples to look for support or resistance. That's all there is to it. I think allot of people do this at some level with or without realising it. This simple idea works just as well as any of the fancy, cost a million bucks to buy, calculations or indicators. Or Gann or Elliott or what ever. I'm not knocking any of the others it just this is really easy to do and works well.

 

[Filou]

The method is simple also. You find a high or a low and measure the first wave from that high or low. Then you use that distance in multiples to look for support or resistance. That's all there is to it. I think allot of people do this at some level with or without realising it. This simple idea works just as well as any of the fancy, cost a million bucks to buy, calculations or indicators. Or Gann or Elliott or what ever. I'm not knocking any of the others it just this is really easy to do and works well.[/QUOTE]


Thanks HW
It's certainly a useful tool, much easier than some fancy math.

I'll have a look at some of the big Euroeam markets like the BUND, FTSE, DAX, where Kool's tools don't work as far as I could figure out so far.