Walter Bressert's ProfitTrader 7.0™: Buy/Sell Signal Plots - 1
The new Buy/Sell Signal Plots options show multiple Buy/Sell Setups
on the same price bar to increase the odds of identifying cycle tops and
bottoms as they occur.
ProfitTrader 7.0™ program has four buy signals and four sell signals, mostly
based on oscillator overbought/oversold levels -- the 10 DoubleStoc, 5 DoubleStoc,
BLline and OB/OS signals. These B/S signals are designed to buy cycle bottoms
and sell cycle tops.
signals occur in two steps, which increase the accuracy of the signals:
- A colored
Setup Bar is generated by an oscillator turn, or crossover of a moving
average of the oscillator (the crossover option for the 5 and 10 DoubleStoc
and Bline is only in PT 7.0). The Setup Bar shows the potential for
a cycle turning point, as the oscillators are designed to turn at cycle
tops and bottoms.
- A mechanical
Trigger Entry occurs when prices exceed the high of a Setup Bar for
a Buy Signal, or drop below the price low of a Setup Bar for a Sell
Signal. Waiting for the Trigger Entry will add 15-25% to the accuracy
of a signal using only the "close" as the entry.
oscillators are different for each signal, but all are designed to identify,
and turn at, cycle turning points. At times there will be only one Setup
Bar at a cycle bottom or top; at others, there may be 2, 3 or 4 Setup Bars
at a cycle top or bottom. A single Setup Bar may result in some concern
that it could develop into a false or losing signal. But 2, 3, or 4 Setup
Bars give more confidence that the cycle turning points will be followed
by a sizeable move.
The chart, Buy Setup Bars #1, shows how the Setup bars plot in ProfitTrader
6.0™. They can also be plotted in ProfitTrader 7.0™, if preferred. The colored
indicator legend at the left of the chart matches the color of the Setup
Bars for quick reference.
6.0™, a single Setup Bar can cover up one or more additional Setup Bars,
and the only way to see if there is more than one Setup Bar is to go
into the Format Indicators window and start turning off indicators to
see if another Setup bar is uncovered. This may not be much of a problem
if you are trading daily/weekly price bars, but is definitely something
you do not want to do while trading intraday.
remedy for this in ProfitTrader 7.0™ is to plot a single Setup Bar. The
indicator defaults to the OB/OS Setup Bar because it has a tendency to
plot Setup Bars one bar earlier than the other signals. But the indicator
does allow you to choose the way you want to display the Setup Bar(s)
and Setup dots. The other Setup "Bars" are then plotted as colored
dots below the Setup Bar(s) for a bottom, and above the Setup Bar(s) for
The TS Platform was not designed to plot these dots, and it was a programming
feat to make the dots plot in all markets, all time frames. But on occasion,
some Setup dots will still be further from the Setup Bars than we like.
The big advantage, even with this visual drawback, is that a cluster-of-dots
over several price bars indicate a higher probability of a cycle turning
Buy Setup Bars #2 Chart shows how the Setup Bars and Setup Plots plot in
the ProfitTrader 7.0™ Upgrade. The colored indicator legend at the left
of the chart matches the color of the Setup Bars/dots.
Pattern A in Charts 1 and 2. In Chart 2 there are three Setup dots in
the price bar following the cyan Setup Bar. The red dot is for the high
probability BLine, and Setup Plots also show for the 10DBS and 5DBS
new Buy Setup patterns shown in Chart 2 plot a cyan Buy Setup Bar for the
OB/OS signals, and Setup dots for all other Buy Signals below the price
bars that would have been Setup Bars. Now you can easily see when there
is a cluster of Setup Bars on one or several price bars.