PPI was designed by Precision Trading Systems to compute the exact probabilities of trend going to Y-price by X-Time
Precision Probability Index is a simple to use indicator which computes the odds of a trend continuing or not
The Gold Version comes with two types of strategy
and an indicator for advanced users
Signal line crossing strategy ( Generates trade
on the crossing of the signal line on the main plot )
WATCH PPI VIDEO HERE
Level cross over strategy ( Generates trades on the cross of the level of
probability you specified ( default is the crossing of 50% )
Methods of usage
The indicator can be used as a confirmation tool
to enhance your own strategies profitability
Know
exactly what the odds are of the market rising or falling
Observe the crossing of the signal line on the main plot to warn when the
probabilities are moving
As a risk calculation aid
to know the odds of your trade going in your favor in X number of bars
into the future
With a distorted exaggeration
factor one can use it as a binary trend indicator ( Ranging from 0 to 100
)
An excellent divergence indicator giving
reliable signals
Explanation of how it works
The indicator computes the exact mathematic
probability in percentage terms of a slow moving average being above a
faster moving average in a certain period into the future. This produces a
sinusoidal plot as shown in the photos.
The settings used allow incredible versatility of
uses. A smoother is provided on the main plot which irons out the false
and useless wiggles and this is user adjustable of course.
There is a signal line which can be shown or
hidden depending on preference and useful trade signals can be generated
when the main plot crosses above or below the signal line plot.
Other signals can be generated by the cross above
or below 50%. Here also this is configurable to compensate for bullish or
bearish technical set ups. The default value is 50% but you can set it to
buy above 51% or 50.0002% and sell below 51% or 50.0002%.
Dead spots are can be created simply by leaving a
gap between the buy above input and the sell below input. EG Buy above =
50.04% sell below = 49.96% gives a symmetrical Long-Short strategy with a
dead spot of 0.08 wide. The concept of this dead spot feature is designed
to reduce over trading at points of near equilibrium market conditions.
You can skew the dead spot to any level you wish,
for example if you are bullish of the market you might like to buy sooner
and sell later, so you can find the mid point of 49% and set buy above to
49.02% and sell below to 48.98%. Huge flexibility can result from doing
this.
In addition there
is also an exaggeration factor which distorts the volatility component of
the model to allow exaggerated readings, the reason for this is to enable
Precision Probability Index to function as a binary trend indicator, or as
an accurate probabilistic computer, and various mutation in between these.
Precision Probability
Index GOLD comes with two strategies.
1. The crossing of the signal
line strategy
2. The above below zero strategy.
This product has been tested by NinjaTrader staff and has passed their testing procedures
Chart below PPI trading on the E-mini SP500 Futures in a 10 minute time frame chart
Precision Probability Index is used to trade on the
crossing of the 50% line (The 50% line can be adjusted up or down to
factor in up or down trend biases)
Notice the
additional bonus observation of a bearish divergence that validates the sell signal which occurs
afterwards
Video showing how to use Precision Probability Index in NinjaTrader
The 20 tick time frame is used to demonstrate in a fast and fun way. In actual trading use it is suggested to use a slower time frame.
Precision-Probability Index on Cac 40 futures using a 1 minute chart.
Chart below: CL 2 Renko bars
Precision Probability Index works on any chart
type in the Ninja Trader platform, includin the Renko type below.
Here you can see the "above below strategy"
giving timely trades on the CL light crude oil futures as the buying
pressure alters the probability
Precision Probability Index shown below on 1 hour chart of CL Crude oil futures.
This indicator was designed to help YOU be the wise guy in the market.
Chart below: CL Futures 60 minutes ( USA Crude oil futures )
Precision Probability Index is used to trade on the crossing of the 50%
line
Notice how well the strategy stays short during the volatile
downtrend when many other strategies would be shaken out.
These little differences in trading strategy performance give enhanced
performance to investors over the long run, the dealing costs are reduced
and the financial ratios such as risk-reward, calmar and the lake ratio
also improve.
Whilst the indicator plot may resemble demand index or relative
strength index or money flow index, the trained eye can differentiate
between them.
Precision Index Oscillator markets and their suitability.
Stocks, futures, bonds (real time and end of day)
Forex: Pi-Osc will perform on forex but as forex does not print volume in the same way the above do, performance can be less than optimal as less information is being given to Pi-Osc.
Forex futures: These instruments do have reported volume so Pi-Osc will perform normally.
Chart below: Daily chart of Burberry PLC with a nice buy signal and a double pi top which didn't go far.
Precision Index Oscillator chart
types in for Tradestation
Chart below: GBP-USD 15 Minutes
Precision Probability Index is used
to trade on the crossing of the 50% line
The slow average is set to
100 and the fast average is set to 80 and Bars futures = 100, Here the
stock market trend predictors often find difficulties as forex is ofter
much harder to use in trend following methodologies. PPI makes perfect
sense out of the patterns and oscillations that occur in the English pound
versus the US Dollar, Event analysis performed using the mass index or
speculative sentiment index show the supply demand of the consumer are an
average indication of reality when compared to the Precision Probability
index when set up correctly.
Precision Probability Index can be used on Forex, futures, stocks, indices, bonds etc.
View license prices
for PPI
Precision Probability Index is used to trade on the crossing of the 50% line
The slow average is set to 100 and the fast average is set to 80 and Bars futures = 100, Here the stock market trend predictors often find difficulties as forex is ofter much harder to use in trend following methodologies. PPI makes perfect sense out of the patterns and oscillations that occur in the English pound versus the US Dollar, Event analysis performed using the mass index or speculative sentiment index show the supply demand of the consumer are an average indication of reality when compared to the Precision Probability index when set up correctly.
Chart below: DC Milk futures Daily chart
Precision Probability
Index stays long from 5.30 to 16.45 in a signal trade
Did you
notice the bearish divergence that occurs before the sell signal? This
indicator is comparable to the demand index indicator when it comes to
finding selling and buying pressure imbalances in the stock-market.
Chart below: EUR-USD 10 Minutes
Precision Probability Index is used to trade on
the crossing of the signal line
Chart below: CHF-JPY 10 Minutes
Precision Probability Index is used
to trade on the crossing of the signal line
In the image below you
can notice the signal line smoothing is increased to 30, this helps to
reduce whipsaws and over trading on a noisy data series
| FAQ for dummies | Response |
|---|---|
| Question: Which markets can PPI be used on? Answer: Anything with a price that can be used in NinjaTrader, such as stocks, forex, futures, bonds, indices etc Red peppers seem to be bottoming out.... |
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Question: If I pay for a one month trial what happens when it expires? Do I have obligations to renew? I am a bit worried about this please advise Answer: The are two possibilites. 1. Don Corleone visits you and you will wake up with a horses head in your bed. 2. The Pi-Osc will stop working. More likely that it is No2. |
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Question: I cant find my machine id number in NinjaTrader 8 Where is it? Answer: Click help > about and its on the 5th line. Copy and paste it in the Paypal form when ordering |
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Question: Your FAQ is funny! Did you ever think of offering a prize for the most stupid question? Answer: My research shows a bit of humour helps to encourage careful reading and avoids having to ask me something which is already written clearly on the site. I like your idea, and might do an email shot which will add an extra free month onto an existing license for the funniest silly question. Even my dog can read, here he is studying Elliot wave theory although he finds it confusing. Fletcher trades charts See my dog Fletcher trading with Elliot wave theory (old page) |
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Question: I trade mostly on the 1 minute chart for the currencies 6E & 6A and was wondering if your indicator is practical and effective to use on a 1 minute time frame? I see most of the screenshots are 10 minutes and up Answer: I may be talking myself out of a sale here, but I know of no system that is profitable in a 1 minute time frame over an extended period. Mostly the vendors of these " fantastic day trading models " are scammers who know people are attracted to the excitement of high speed trading, and milk it accordingly, please understand there is a big difference between them and me. And... Send me the code for a strategy that is consistently profitable over the last 3 years of SP500 futures that samples data using a 1 minute chart and you can have a free 10 year license for Pi-Osc on Tradestation 8. |
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Question: I have 8 computers here that I use. As they are all my own computers I want you to set up 8 licenses for me for the same price. If you can do this for me I will subscribe immediately. I tell you in all honesty that they are mine and I am not ordering on behalf of my friends using them. Answer: See this video clip |
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Question: I have not received my indicator yet and ordered it 45 minutes ago. Why is this? Answer: You did not include your machine id number in the Paypal payment page. |
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Always remember to back test your ideas and use risk management
-----------------------------------------:
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Precision Trading Systems was founded in 2006
providing high quality indicators and trading systems for a wide range of
markets and levels of experience. Supporting Tradestation, Tradestation and
MultiCharts. MetaTrader 4 products are currently unavailable. Admin notes
Page updated - June 29th 2023 GS No
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