sts - the basis of the sangha trading system

Jan. 30, 2012 STS – THE BASIS OF THE SANGHA TRADING SYSTEM

DISCLAIMER: Online trading involves substantial risk of loss and is not suitable for everyone. The valuation of the contracts does fluctuate, and, as a result, you may lose more than your original investment. The impact of seasonal and geopolitical events is already factored into market prices. The highly leveraged nature of online trading means that small market movements will have a great impact on your trading account and this can work against you, leading to large losses or can work for you, leading to large gains. If the market moves against you, you may sustain a total loss greater than the amount you deposited into your account. You are responsible for all the risks and financial resources you use and for the trading systems you are using. You should not engage in live trading unless you fully understand the nature of the transactions you are entering into and the extent of your exposure to loss. If you do not fully understand these risks you must seek independent advice from your financial advisor. All trading strategies are used at your own risk. This mentoring should not be relied upon as advice or construed as providing recommendations of any kind. It is your responsibility to confirm and decide which trades to make. Trade only with risk capital; that is, trade with money that, if lost, will not adversely impact your lifestyle and your ability to meet your financial obligations. Past results are no indication of future performance. In no event should the content of this correspondence and coaching be construed as an express or implied promise, guarantee or implication from Children of the Journey that you will profit or that losses can or will be limited in any manner whatsoever. Children of the Journey is not responsible for any losses incurred as a result of using any of our trading strategies and mentoring. The Trading software should never be left unattended due to the possibility of events out of your control, such as computer or data failure, power outages, position mismatches, and/or network problems. Loss-limiting strategies such as stop loss orders may not be effective because market conditions or technological issues may make it impossible to execute such orders. Likewise, strategies using combinations of trading positions such as “spread” or “straddle” trades may be just as risky as simple long and short positions. Information provided in this correspondence and coaching is intended solely for informational purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted.

1 of 10 STS – The Basis of the Sangha Trading SystemAll Rights Reserved;The Children of the Journey Sangha of the East Coast. Copyright, 2011-2012


Revision Log:

20120111.1800 – A.Penaloza – created initial document.

Related Documents:

STS – The Knowledge Base.docThe Sangha Trading System.pptSTS – The Perfect Picture Book.doc

Contact Info:

Email: [email protected]: @tradingsanghaWeb: tradingsangha.blogspot.com


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Contents

Mission Statement.............................................................................................................................................................................. 4

Mastery 4

PLAIN LANGUAGE DISCLAIMER: 5

The Sangha Principles 5

What is the basis for The Sangha Trading System (STS)?.................................................................................................................. 6

What gives STS mechanistic/predictive power? 6

MacdRates makes the cyclic and symmetric nature of the market completely obvious 7

Why use the Jerks? 7



Purpose

This is the collective Wisdom our Spiritual Community of Traders had been gratefully made privy to by the Universal Intelligence of Love.

This manual is a compendium of knowledge we as individuals and as a community continue to learn with appreciation and gratitude.

Mission StatementWe believe in the Divine and the Universe. We are eternally Grateful and ever Thankful for the Gift

given.

We are continually given the most amazing insights about this Gift; which allowed us to create a business that takes little of our time to run during the day. This Gift enables us to spend quality time helping others as the Divine wishes. This is the reason we teach this Gift to others. We depend on the

Divine and the Love of the Universe to lead others to us.

Mastery

It is what "is", you are seeing what you “see”. It is ALL in the technique and your efficiencies.

You can’t predict the future trends of the market, you are but a mere follower, so act like it!

You must only develop the ability to see what is before your eyes. The Universe is asking for little more in this endeavor.



Practice being efficient! Points per trade, get it up.

Like Dirk Nowitzki in the NBA at 2.5 points per hoop. (The best average near him is 1.3).

Not like Monica Lewinsky, who swallowed many a shot, but didn’t get credit for one.

Using the least time and effort, a skilled performance = EFFICIENT!We will become “Madly” skilled in this area. Kurt Duerod…

PLAIN LANGUAGE DISCLAIMER:

1. The Sangha will never ask you for money.2. The info IS PROVIDED FREELY with "no strings attached".3. The Sangha will provided answers and guidance pertinent only to The Sangha Trading System.4. The Sangha WILL NOT provide proof of effectiveness nor ANY guarantee of FITNESS of use. Prove it

to yourself!5. You are FREE to profit from “The Sangha Trading System” in any way you choose, with only ONE

RESTRICTION – Give credit to “The Children of the Journey Sangha” as the original creator.

The Sangha Principles

1. Those that have the passion and perseverance, on their own volition, will prove the merits of "The Gift" to themselves and acquire the necessary skills by their own effort.



2. As "The Gift" was freely given to the Sangha, we FREELY give the gift from our heart to those who ask us. The Sangha will freely answer questions and provide the foundational knowledge to those who seek.

3. The Gift of "The Sangha Trading System" is Open Source and will adhere to the "7 Guiding Principles" of Open Source.



What is the basis for The Sangha Trading System (STS)?

STS is simply based only upon the Macd. NOT the Bollinger_Band Macd (BB_MACD)!

What makes STS unique is the use of multiple Tick Timeframes of MacdsRates ALL plotted on one graph. MacdRate is the slope or 1st Derivative of the Macd.

Where:Macd1 is 1/2 times the Macd2 Fast, Slow, Length constants.Macd2 is 1 times the Macd2 Fast of 12, Slow of 26, Length of 9.Macd3 is 2 times the Macd2 constants.Macd4 is 8 times the Macd2 constants.Macd5 is 21 times the Macd2 constants.Macd6 is 89 times the Macd2 constants.

When the MacdsRates are all plotted on one separate graph, with the price action, each MacdRate line must be independently scaled against the other MacdRate lines. If the MacdRate lines share the same scaling, the Crossing Method of trading will NOT work! Every MacdRate line must move freely against each other. The CROSSINGS gives us the "DOWN-THE-ROAD-VIEW" of market trend. Kurt found that extensive use of Macd_6 and its derivatives of MacdRate_6 and MacdRateSmooth_6 (Exponential Moving Average of length 9) works best as Crossings with the price action, in conjunction with crossings of Jerk_1 and Jerk_6.

UPDATE: The Universe revealed it is so much better to use "MacdRates as Crossings". Please see the video in the this blog post.

~O~

What gives STS mechanistic/predictive power?


http://tradingsangha.blogspot.com/2012/01/follow-lines-using-macdrates-as.html


http://www.scribd.com/doc/77272629/STS-Layout-and-Methods

http://live.geckosoftware.com/manual/indicators/macd_bb.htm

http://en.wikipedia.org/wiki/MACD


When we take the first derivative or slope of each of the Macd Tick Timeframes above, which we call MacdRates.

When the MacdRates are plotted together again on another separate graph (where all MacdRate lines use the same scaling), we have a very predictive and mechanistic indicator. Each MacdRate MUST fulfill its mission, especially MacdRate1, which we call the PRIME!

MacdRates makes the cyclic and symmetric nature of the market completely obvious

When the MacdRates are above the Zero line, they MUST eventually go below the Zero, no matter how brief and the reverse is true. This cyclic nature of the market is manifested in the PRIME (MacdRate1 - "the Heartbeat of the market"). When the PRIME or any other MacdRates crosses the Zero from below, then the uptrend is committed and confirmed. The reverse is true for the downtrend. This is known as the PRIME Method (which we call TTS) of trading, which is very symmetric and mechanistic. The MacdRates gives us the reasons "why the market is behaving" through the theory of "Cycle Jumps or Hand-off". Please see "Kurt's Wisdom Repository".

When you use the MacdRates, you have a method of trading that is amazingly "light", easy-to-use and extremely less discretionary, when compared to the BB_Macd Method taught by Henry Roche (AKA: Fernando Silva and by other names doing questionable deeds).

Why use the Jerks?

The Jerks are the 2nd Derivative of Macd1 and Macd6. When Jerk1 and Jerk6 are plotted together on another graph (where Jerk lines all use the same scaling) you have an extremely useful indicator (Jerk1) for knowing when the PRIME is ready to cross the Zero line or when the PRIME will be prevented from crossing the Zero line and therefore delaying the trend change (the original trend still continues or the market goes sideways).

Watch the video and see how Jerk1 react when the PRIME fails to cross the Zero.

UPDATE: Please watch the other video in this blog to see how Jerk use has evolved. We now use Jerk_1 (2nd Derivative of Macd1) with Jerk_6 (2nd Derivative of Macd6) to tell us the correct moment to take position, when a new trend starts or to safely get into a trend we just missed.



http://dl.dropbox.com/u/51589573/The%20Sangha%20Trading%20System/Videos/STS%20-%20Twos%20Trading%20Strategy/STS%20-%20Twos%20Trading%20Strategy.mp4

http://www.bigmiketrading.com/180120-post91.html

http://tradingsangha.blogspot.com/p/kurt-duerod-wisdom-repository.html

http://tradingsangha.blogspot.com/2012/01/we-have-ignition.html

http://tradingsangha.blogspot.com/2012/01/we-have-ignition.html


~O~

Any and every "CROSSING" of the MacdRate lines or the Zero line is ALWAYS significant!

When the MacdRate lines cross or cross the Zero, you either have a trend change or the current trend is confirmed.

Here is a picture to help explain the discussion above.

~O~

All the above makes STS a truly versatile toolset applicable to any financial instrument or to any time-series data you wish to analyze.

As a STS practitioner, prove to yourself, through Market Replays and Historicals, the veracity and effectiveness of using any one or all the STS tools in making your trading experience serene, simple and safe.


http://dl.dropbox.com/u/51589573/The%20Sangha%20Trading%20System/Pictures/STS%20-%20Rates%20as%20Crossings%20-%20Uptrend.jpg


~O~

The above is a wonderfully Free Gift given to ALL from the Universe!
