I hope you enjoy this video showing you how you can trade mean reversion without using any indicators at all!

@matthunter9562

3 жыл бұрын

Is that this strategy still work if the market in the trending condition?

@johnshugo9608

3 жыл бұрын

Hello, sir.. I used an idea from this video. I made an EA based on the tutorial you provided. I made some modifications to the strategy. I provide a link to download on my web for reference. I hope you don't mind me including your video link there.

@TheTransparentTrader

3 жыл бұрын

@@johnshugo9608 Well done! I always encourage testing and modifying for yourself. What are the modifications?

@johnshugo9608

3 жыл бұрын

@@TheTransparentTrader Thank you sir. I use the highest high and lowest low of 6 candles and the running price for the execution (not the close candle price).

@jktrader37

2 жыл бұрын

@@matthunter9562 I would ONLY use a mean reversion method ( during a trend) in the direction of a the primary trend ( otherwise you will be cut to pieces).. i.e,. if the trend is UP, only take mean reversion trades that would place you in the BUY LONG mode, ( i.e., shorts will most likely be killed ) I hope that helps

Eventually, professional guidance may be the only recourse!

@EButz

8 ай бұрын

how so?..if u don’t mind please could u shed more light on this

@Couchlnvestor

8 ай бұрын

For starters you’ve got to understand that trading is no walk in the park, you’ll be needing lots of study and practice before trying out real trades even then you’ve still got to go easy.

@EButz

8 ай бұрын

lol blew my account twice already

@OhhHellNoYouWont

8 ай бұрын

Well, I’m convinced that the key to safer trades and lucrativeness is professionalism.

@OhhHellNoYouWont

8 ай бұрын

Over the years I’ve been very fortunate to work with a certified broker Christine Mila, I met her at a summit in Oklahoma where we discussed how she can guide me on the technicalities of profiting in the market and if I’m being honest I’ve had numerous withdrawals under her guidance.

I’ve just been manually testing this on tradingview and am really impressed with the results. Will back test this properly and take notes. Thanks a lot Jarrod.

@raymondphilip6232

3 жыл бұрын

Use mt5 bro, easier to backtest

@raymondphilip6232

3 жыл бұрын

Just a recomendation, look it up when u have time

@TheTransparentTrader

3 жыл бұрын

Great! I always encourage everyone do their own testing too.

@randomz8065

2 жыл бұрын

what was the result of the back testing

@TamerRashdan

19 күн бұрын

It works until it doesn’t

Thank god I found you...you are seriously the only mean reversion trader on you tube...!!

@danield.thompson6158

3 жыл бұрын

Very true

Insightful video as usual. Thanks a lot!

Great work and very inspiring. Thank you a lot for sharing this!

This equity curve is nice...thanks for sharing!

This was really fascinating. THANK YOU!!

Regression to the mean is a very powerful indicator. Thanks for sharing.

Amazing, very simple method yet effective. Thank you for sharing the knowledge. God bless you.

Excellent, the best trading coverage on KZread by a country mile!

@TheTransparentTrader

3 жыл бұрын

Thanks Louis! Glad you find it useful. Just sharing how I study the markets in order to develop strategies.

I think using a moving average (mean) is very helpful.

Hi ,,your video is simple, but is great,, you teach one of the most important thing in trading,,,,many people don´t understand this concept for many years and is the core concept for entry in a trade , congratulations

Thanks a lot Jarrod🙏 That's very interesting👍😁

Great video, would have helped if you had mentioned it's a stop and reverse type of system with a fixed stoploss :) No matter, the comments cleared it up for me. Thanks!

Really enjoyed this video, thank you for sharing. With just this information alone, a trader could literally make a living from just this information. MANY ways to trade, but, the equity curve doesn't lie. Thanks again.

Thanks for sharing the knowledge

This advice is very useful.. thanks a lot

Thanks again Jarrod!

Really like your analysis and enjoyed the video.

Your video is really concise, I think I will test it out with crypto. Thankful for the strategy and wish you good health!

How do you enter on the second candle of the previous six? In case of going long and the second candle is the lowest close out of the six. Or do you only check the last close and see if it's the lowest of the past 6? Thanks

Thanks for sharing!

good resource, thank you for putting it out there. I use a ema bounce m15 candlestick strategy and feel this will help with it. Can I ask what software are you using to backtest?

Haven't tested this yet but the market can move a long way in one direction w/o the reverse signal and the loss will be huge.

@alrey72

2 жыл бұрын

@@jakesanders136 It was mentioned in some comments that there is no sl. The buy signal closes the sell postion and vice versa.

@jaysteve4442

Жыл бұрын

Of course u would have stops in place. Gotta know when you’re wrong

@OneCreator87

Жыл бұрын

Don't trade 100 lots and you'll be fine. Also, don't use this on GBP and pairs that like to do the thing you said.

@lakshaydhiman6132

11 ай бұрын

No

Trading without indicators " and this line here is a moving average" OH HERE WE GO

I would ask you some clarification over your strategy: since you invert the current position when you get an opposite signal, what happens to the open trade when you have an opposite closing the day before or similar when the trade is crossing the preferred time zone 14-19 EST? are you closing the trade or you leave it going?

@TheTransparentTrader

3 жыл бұрын

Hi, using 15 minute bars only take the entries or exits if they occur within the time window. If you are already in a trade and an opposite signal occurs but you are not within the time window then leave the trade running until you get a signal within the next time window.

Thanks for this insight. I'm going to back test it on TV on the 5m and 15m timeframe to see what results I can get. So when you said..."if we have a strong close to the downside (or upside), then that's the direction you would be looking at trading in for the next day. How much of the close are you looking at to make that next session determination...the last hour, the last 2 hours, etc. ?

Very Insightful!

A little late to the party here, but how do you define a 'strong Close'? Are you looking at a large range day? And/Or the close in relation to the high/low of the day?

Very interesting tq, will try it out.

I enjoyed the video and study. Thank you. I really liked that you kept it simple, gave a clear explaination and are able to present the statistics. I do have a request. Can you elaborate on what a "quite a strong" close is? Id like to hear more specific details. Have a great day.

Amazing. Thank you

Your videos are high quality!

@TheTransparentTrader

3 жыл бұрын

Thanks!

Great vedio , thank you for your helpful information

Jarrod, as I understand it, if previous day was a strong bull candle, you will go long in new day against strong bear candles...do I have that correct?

Jarrod great video learning a lot from your content,plz could u do a video on the mean reversion on say bollinger band a practical strategy how u take the trade and exit i assume at middle band,would appreciate a video on the strategy thanks

Hi That was very interesting and useful. The way you showed the chart hand drawn they looked like inside candles. Does the same apply to 6 trending candles? Thanks

I trade with a mean reversion indicator together with other indies, and love it.

@eddyvideostar

3 жыл бұрын

To Sit hapromwas ph: Info, link and data, please.

@MrAcSP

3 жыл бұрын

What kind of mean reversion indicator are you using? I am using on balance volume oscillator with the settings Periode 14, Levels for reversals at 20 and 80 and only on the H4 and daily charts.

Interesting, I've been trading for 10 plus years & often the projections of equity curves don't match reality when it comes to algo live trading. Depends on the data you use & how robust the stradegy is through all market conditions.

What is your exit rule? Thank you for the insights

thank you so much

I love it! You mentioned about looking at the prior day's candle, to help filter your trades. If it was a strong up day, only take longs; if it was a strong down day, only take shorts. How do you code "strong"? And if yesterday was an average/ordinary candle, the algorithm is allowed to take both long and short positions, right?

@lifeadventurer8

3 жыл бұрын

I guess (after posting my comment above) I could maybe use the daily ATR, then compare if the candle body size was greater than that, and then determine if it was a bullish or bearish candle. Then in my code, I could have true/false variables for a "strong up" or "strong down" day, and if true, only take the appropriate position side... But if neither "strong up" or "strong down" are true, it can take any position direction... Is that basically how you do it?

@allexuk78

2 жыл бұрын

super valid question

Thanks!!!

Thank you

am i not understanding this properly? so if you are looking back at the last 6 bars, and the last bar in your scope is the highest close in the past 6, you would immediately open a short? And opposite for longs? Someone please tell me i'm misunderstanding that right?

Lots of "food for thought" in this video. Thx. I think the strategy should work best on non-major-news days. Also, there are some currency pairs which tend to bounce around a lot during the Asian session (e.g. gbpchf, eurchf, gbpusd etc) but don´t normally trend. An ideal situation for mean reversion strategies. I haven´t looked at it yet but there may also be a quiet time later in the European session before New York trading begins. Lots of opportunities to test and apply these strategies.

thank you

Excellent 👌

You're a math/finance major I assume? What's your stop loss % usually also? Just wondered if you feel arbitrage orders have created much wider swings or am I overestimating the market makers influence? Thanks very much!

Great video bro . Pls why 6 candles?

Very good

Mean reversion don't always work, price can stay overextended (up and down) longer than you can be solvent; it can keep going up or down for sometime and the average will follow up/down the price and the mean reversion will happen at a very different level.

@FenderAddict93

6 ай бұрын

Then you will never succeed in trading if you have this mindset. One strategy doesn’t work for all market conditions.

@richardbokele830

2 ай бұрын

Exactly ! But as the ratio R:R is high ...it will recover losing streaks

Hi Jarrod, thanks for this, just discovered your channel. Can I just ask, do you think this strategy is perfect for a simple Metatrader EA using open prices? It would make backtesting with MT4 very fast, with the 'open prices only' modelling.

@TheTransparentTrader

3 жыл бұрын

I don't use Metatrader so I cannot comment. What is the open prices only modelling?

@kin.ovi.

3 жыл бұрын

@@TheTransparentTrader Open price modelling is for backtesting expert advisors that only trade based on completed bars, so intrabar movement isn't taken into consideration.

@TheTransparentTrader

3 жыл бұрын

@@kin.ovi. If you're going to use a 15 minute chart like I am that should be ok then.

@kin.ovi.

3 жыл бұрын

@@TheTransparentTrader OK great thanks

This is really good content, i'm glad not so many people found it because good legit contents only reserve for the 6% lucky profitable trader

Is this strategy timeframe bound? And how many pips should the stops be ?

@TheTransparentTrader

3 жыл бұрын

This is an example of a mean reversion strategy without indicators. It's not a complete strategy yet. Markets do move different for different timeframes so just because it works on this time frame doesn't mean it will work on others. This is why it's so important to test.

what are the good currencies to use? EUR, GBP, AUD ect?? cross rate maybe?

What is being used as a take-profit? How long is he holding for?

Does this work on stock too may I ask?

What the best time frame to use this or get into a trade?

Interesting.

Ive been trying to figure out the market monopoly and indicators can be a distraction and I would at times be overloaded with information and end up trading the indicator rather than the price. I’m going to try trading candle closes with resistance and support levels and market highs and lows in the trend. I’ve been in this game for 5-6 yrs now and it’s very frustrating if I think about how long I’ve been in it and haven’t been profitable

can this be applied to trading OPTIONS as well? i mean the 6 candles?

Check charts over 10 years, everything returns to original levels. You have a window of opportunity every few years to make 1 killer trade requiring patience and 4:1 margin you can clear over 1Million profit, all you need is time.

Was this strategy ever proven to work? I really like the method described here however i dont think trading costs have been factored in.

Hi Jarrod, from comments below, I see that this is a stop & reverse type strategy. But how about the market behaviour the day before which we use as a filter? I mean, say, it was an up close yesterday which means that today I will be taking only long trades between 14:00 pm to 19:00 pm EST. Between trading time window, a set up formed and I opened a position. And then a stop & reverse pattern formed which encourages me to close my long position and open a short position. However, yesterday' s market behaviour (which I use as a filter) does not suggest me to do so. So, may I still use stop & reverse as an exit strategy? Please advice,

@aslanmuradekmekci5277

Ай бұрын

The same question may be asked for the Bollinger Band 30 minutes timeframe intraday strategy you developed for GBPUSD (yesterday' s market behaviour is a filter).

are trading commisions included in backtesting result

Thanks for the video and I note that this is a Stop and Reverse Strategy Your improvement is to limit the trades to buy or sell depending on market move on the previous day I assume that trade exits on these days would be on a take profit basis?

@TheTransparentTrader

3 жыл бұрын

Yes I am limiting trades based on previous day's behaviour. But that also means not exiting the trade either as there is no separate take profit order.

@kerryriordan8662

3 жыл бұрын

@@TheTransparentTrader wouldn't you be destroyed in a trending market?

@robmcghie5248

2 жыл бұрын

I like to use Parabolic SAR along with EMAS major S and R not using lots of lagging indicators

@robmcghie5248

2 жыл бұрын

@@kerryriordan8662 This is a scalping technique So expect most gains from being in the trend and don't expect to make many pips from Pullbacks

Just a quick question about exiting, you are in the trade until you get a opposite signal?

@TheTransparentTrader

3 жыл бұрын

Yes. It's a stop and reverse type strategy.

@alfred604

3 жыл бұрын

@@TheTransparentTrader Thank you for the reply.

no words about stop loss

He drew that moving average smoothly

You never mentioned the stop location and TP you used in back test. Also what was the account size and trade size????

What is the Exit strategy?? Thanks.

I trade the Indian markets and we have higher volatility here. I am planning to use the mean reversion to identify short and long trades using a daily chart and a 50DMA (Exponential) . My trade durations could span a few days and I am not intra day - more positional. Any advice?

@franciscom.d.459

Жыл бұрын

He's, muy advice Is retire hour Manu quickly

@franciscom.d.459

Жыл бұрын

Hour money

Hi.Where do you exit trades?

where to download the powerlanguage code for this strategy ?

If the lower close is happening in every 30 min bar, will you keep buying at every lower close. What is the stop loss

I didn't catch what the exit rules are. Can you clarify please? This is really interesting.

@OneCreator87

3 жыл бұрын

It's the opposite signal!

@h.l6849

2 жыл бұрын

@@OneCreator87 thank you. i missed that too. So it does not use SL?

@OneCreator87

2 жыл бұрын

@@h.l6849 No, in this system the opposite signal acts as a take profit OR stop loss. Fixed stop loss is not necesary if you trade small in the right markets/time-frames, and will likely hurt the strategy performance badly if you do it incorrectly.

@h.l6849

2 жыл бұрын

@@OneCreator87 noted. I uses BB and trade similar hours. mean reversion works well in this period, but the SL is an issue. so this gives me some fresh ideas. thank you

@h.l6849

2 жыл бұрын

another question. when the daily filter is used, does that mean that its no longer a stop and reverse option. it will be the 6 bar high to exit a short entry, but it wont open a new trade?

I guess I dont understand. What if you go short after 6 green candles and it goes up 6 more? When do you get out before being liquidated?

if all you are using is the high or low[close]....how do you know weather its going to revert to the mean?..i always thought that the reason that price reverts is because of std dev.of 2 or better is extreme...but without an indicator,or without a calculation,price might not have reached the 2 std dev and fake you out like its about to mean revert but it does not.

GOOD DAY SIR, SIMPLE BUT GOOD, QUESTION IS EXITS OR STOPLOSS DIDN'T MENTIONED, WHEN AND HOW ? THANK YOU SIR.

Hi all. The exit is stop and reverse!

I like your videos I like people who back their ideas with proof I am a flandering trader who's been in the middle forever make money lose money make money lose money make money lose money

thanks for sharing this knoledge - but when i look on charts most of the time it doesnt work. may be the robot you showed include more filters.

Curious - what's the reasoning behing looking at the candle close instead of high? After all it's just an arbitrary point in time based on the time frame we''re looking at

@TheTransparentTrader

9 ай бұрын

I find closes very significant. Is it because a lot of other traders are also paying attention to the close as a level?

Where do you take profits?

Very nice. Thank you . Wish to see more of your videos in the future.

This method because we are trading with HINDSIGHT?. We already know from looking back thru the history of the price action is UP.. Would this method work if I started today?.

No transaction costs?

I repeated it in python backtesting system, as an algorithmic strategy, with those two rules of buy and sell. Complete disaster! Where do you think can be a difference ?

I have a question about if it's a downward trend and each new bars closing is smaller from the previous six bars.Than what happens? What ı understand is that the algorithmm should buy buy buy ... and so on! Is that so?

@TheTransparentTrader

3 жыл бұрын

The algorithm will only buy 1 position even if the trend continues downward.

@IkennaIloejeo

2 жыл бұрын

@@TheTransparentTrader thanks for this. Please how do you code it to not continue to buy with lower closing prices in a downtrend? I believe it will keep buying and losing until a reversal occurs?

Any reason for using bars instead of candlesticks ??

@TheTransparentTrader

3 жыл бұрын

No, I am just used to using regular bars. Either works!

Is this for options? Or sell buy trades?

@TheTransparentTrader

3 жыл бұрын

No this isn't for options Colette.

The market can stay overbought or oversold, longer than you can stay solvent. This is the problem with mean reversion. And breakouts suffer fake outs, due to manipulation. Need other tools.

Whether the other bars are 6 bar highs themselves is irrelevant?

@TheTransparentTrader

3 жыл бұрын

We are only looking at the closing prices in this strategy.

Last 6 years look similar to buy-n-hold returns. 6% per year?

In journalism they say if celebrity or politician survived for 11 days after a big scandal, than he'll be out of harms way. Jarrod just proved the same thing in markets, but its only x6 days. I market was shocked into a direction, effect will fade after x6 days.

TP, SL ?...

Where is the take profit?

Jarrod.....the damn diverts sometimes freeze your video.....very frustrating ....N