Tight AIMS box early warning indicator

[Dave]

Hi everyone,

Given the London and US markets are closed today it gives me a chance to post this topic. Firstly, all praise and thanks to Steve for his selfless work to get this indicator to the point that it is at now. It was my first attempt at any sort of coding or even detailing the criteria I wanted the indicator to identify, so he was very patient! Anyway, I'll do my best to explain what this indicator is for.

Basically, I wanted an indicator that will show when price action is likely to produce a new AIMS box before that AIMS box is fully formed. More than anything this is because a) you get that couple minutes extra to check your stop loss, work out your position size, but more importantly b) because when price is really moving the AIMS low (or high for sell entries) often forms and is confirmed after price has continued on its way, and by then it's too late. Best to illustrate with a picture....

Screen Shot 2013-05-27 at 6.13.46 PM.jpg

So you can see the green arrow indicating candle 3 as a setup. Basically, it's saying that we have rising AIMS high levels and that candle 3 has a lower low than candle 1 or 2, but a higher low than the previous lower AIMS level, and thus can form a higher lower AIMS level. You can see that in this instance though that AIMS low was not confirmed until candle 5 closed, way too late, but by placing a PO above the AIMS high, and having price break that high shows a willingness to continue up and suggests a possible 1-2 under candle 3. I see this indicator as of most value when looking for those higher time frame breaks with lower time frame stop losses. E.g. imagine the confidence you could have in your stop loss if price was breaking an M5 AIMS level and showing this sort of price action just before the break on M1, and therefore giving an opportunity for a very small stop loss knowing that there will be a new AIMS level formed. This is one of the reasons, I believe, that Grant finds such success with placing his SL below the trigger candle, because he is looking for these small AIMS boxes, and is looking even closer for the price action that will give rise to these new AIMS levels that have otherwise not yet formed, i.e. the 1-2 before the juicy 3rd wave.

I have attached the indicator as I have it now. Out of respect for Steve's hard work and coding I will not post the mql4, only the ex4, but it's enough to work on your charts, just not modify the indicator coding. The problem as it stands is too many false arrows. Obviously we are only interested in being triggered into a position when price breaks the AIMS level and gives us a higher high or lower low, and if it doesn't break and trigger the order well then the arrow is proved invalid. Anyway, I'd love to hear anyone's opinion on how this indicator can be improved as I honestly think it can benefit us all, especially those trading M1 charts. One quick little glance and we can see very small pending boxes = very small SL = close 50% TP and big % returns!

Thanks!
Dave

[Dave]

Screen Shot 2013-06-04 at 5.43.26 PM.jpg

[immy]

Screen Shot 2013-06-04 at 5.43.26 PM.jpg

Thats absolutely right! and that is why we put our SL above or below the fruit. in fact, if it takes you out immediately it will NEVER turn into an AIMS level proving you wrong. Its one of the best spots to enter the market, when you're right!