Probability is your friend

2020年11月11日

I wanted to share my research for today in a pattern I have begun to notice regarding the BBK Squeezes. Often times a "squeeze within a squeeze" is a great precursor to a breakout move. This really just goes back to the classic chart patterns of wedges and flags which many people use to great success. By coding it up though it lets me do two very important things as a trader: A) give me a visual representation for pattern recognition and B) setup alert triggers for many instruments so I do not have to watch them all of the time.

From a straight up probability standpoint if we look for these squeezes on BTCUSD over the last year or so the 'both' squeeze has happened on the Daily chart 7 times. 5 of those would have yielded breakouts of 1-to-1 or greater reward/risk. Yes there were losses but losses are just a part of trading. The probability of using the signal as a strategy makes up for that.

I also have begun using this to find opportunities on forex pairs like the NZDCHF and NZDUSD this week in particular. The intent of developing this strategy was to be able to use Tradingview to scan for these periods of low volatility that may precede high volatility.