Chaos operation in foreign exchange trading

cleverboy • • News
  • In addition to fundamentals, foreign exchange trading also pays more attention to technical analysis and data analysis. Today, we will talk about the introduction of chaos trading philosophy in technical analysis. Chaos trading method was founded by American investment Master Bill Williams and written in his book chaos operation method. Chaos operation method is a complete set of almost perfect financial investment ideas, trading strategies and in and out signals. It was invented by Dr. Bill Williams, the most outstanding trader in chaos theory of American doctor Shuangliao. He applied chaos theory, the greatest basic scientific discovery in the 20th century and Einstein's theory of relativity, to the field of Finance and investment, invented the chaos operation method, and achieved great success.
  • The whole chaotic operation method is composed of five dimensions (technical indicators): alligator, fractal, momentum, acceleration and balance line
  • Crocodile line is divided into tooth line, lip line and jaw line. Basically, no matter the real-time price moves in any direction, crocodile line plays the role of compass to keep our trading in the right direction. What's more, crocodile line will help us make profit in the direction trend, and keep this profit until the consolidation trend that will eat our profit appears. When the moving averages of blue, red and green are entangled, it means that the crocodile is asleep. When he wakes up from a long sleep, he will be very hungry. And further pursue the price to fill his stomach until he is satisfied. So when crocodiles sleep, we usually stay out of the market and wait until a fractal is triggered outside the jaw.
  • Fractal is formed by the simple principle of multi space. When the market goes up, the buyer's willingness to pursue high prices is very high, resulting in a rising price. With the rising price, the buyer's willingness will gradually decrease, and finally the price will fall back. Then the market enters into some new information (chaos), which affects the will of the traders. At this time, the market is in the low value area. Both the buyer and the seller agree on the current value area, but they have different views on the price. When the buyer's will is greater than the seller's will again, the price will rise. If the buyer's kinetic energy is enough to surpass the upward fractal, the price will rise, We are going to be active in the up gear.
  • Ao index kinetic energy pointer; AC index acceleration pointer. First of all, we can observe a phenomenon in nature, that is, before a moving object moves in the opposite direction, the kinetic energy in the original direction must first decrease. After gradually reaching zero, the kinetic energy in the opposite direction begins to increase, and the object will move in the opposite direction. Further measuring when the kinetic energy increases or decreases, we can know the direction of the object's motion in advance; So kinetic energy leads the price, and AC leads kinetic energy.
  • After learning the above indicators, we have roughly understood the basic idea of chaos operation method. Generally speaking, chaos operation method is a kind of operation method which breaks through the trend. It is the principle that the strong are always strong and the weak are always weak. The advantage is that you can get most of the profits of a wave of market, but the disadvantage is that you have more stop loss times.

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作者：cleverboy
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来源：Learn forex trading – Foreign exchange blog
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