Risk Disclosure

Futures, foreign currency and options trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results. View full risk disclosure.

BloodHound Overview

Bloodhound is a user programmable indicator based on fuzzy logic.  It takes observations from price action, indicator behavior and other factors as inputs and allows you to design custom logic constructs using logic templates to arrive at a calculated output.  With BloodHound you can encode the behavior of any system, setup, filter or trade signal. BloodHound is a blank canvas – how you use it and how you configure it is entirely up to you.  It is a powerful fuzzy logic calculator that has no limits on how complex your logic specifications may be.  It allows you to define the inputs, and you define how they are used to arrive at a result.   For example, you may have a trading system with defined entry rules based on what’s happening with certain indicators and price bars on multiple time-frames.  You can use BloodHound to describe your system in exact detail, painting your chart with long and short signals.  These signals can also be fed into a NinjaTrader strategy dictating when to buy and sell.  Your resulting strategy can then be easily modified by re-configuring BloodHound’s logic.  This can be done in real-time, allowing you to change the behavior of your automated (or manually traded) system quickly and easily, without the need to update your strategy code. Strategies utilizing BloodHound can be brought into NinjaTrader’s Strategy Analyzer for back-testing.  Again by modifying the BloodHound logic you can alter your strategy buy and sell signals without manipulating any code, resulting in a very rapid prototyping  and back-testing cycle.

BloodHound Output

BloodHound’s final output is a number between 0 and 1 for the long side and the short side for each bar (and tick).  BloodHound is actually calculating two separate evaluations for every bar.  A confidence value for the long side, and a value for the short side.  You can use these calculated values to represent trade signals, market filters, or to indicate that a condition is satisfied.  For example, you can program BloodHound to give you a favorable signal when a certain condition happens on an indicator.  When BloodHound outputs 1 for the long side, and 0 for the short side you can use that as a signal for a long trade, or alternatively use it as a filter to take only long trades.  The choice is yours how you ultimately use the values calculated from bloodhound.  The power comes from being able to quickly reconfigure BloodHound’s output by just manipulating the logic in real-time.

Outputs are called confidence values, and their output ranges between 0 and 1, 0 being an unfavorable value, and 1 favorable.  BloodHound can output decimal numbers as well.  This can be thought of as degrees of favorability.  For example, an output of 0.8 for the long side is considered more favorable than an output of 0.5.  Note: it’s more than possible and sometimes desirable to have both the short and long side evaluate to the same value at the same time.  You can configure how much greater one side has to be over the other side to be considered a valid signal in one particular direction.

  To do this change the Compare Long and Short Confidence value found in the BloodHound settings from the NinjaTrader Indicator panel.  A value of 1.5 means that the dominant side has to be at least 1.5 times greater than the other side to be considered a valid signal.  For example, an output of 0.7 for the long side and 0.8 for the short side is not considered a valid short signal in this case because the short side is not at least 1.5 times greater than the long side.  On the other hand, if the long side was 0.4 and the short side 0.8, that would be considered a valid signal.  Valid signals in BloodHound are plotted as vertical colored stripes (called racing stripes) on your chart.

You can also set BloodHound to ignore the ratio between long and short signals by setting theCompare Long and Short Confidence to false.

Finally below those two settings you see the Long Threshold and Short Threshold.  These are the minimum amounts that the long and short values must be before a confidence value is considered a signal.  Thus a Long Threshold setting of 0.8 (the default) means that BloodHound will not consider the confidence value an actual signal unless the confidence value is at least 0.8 or greater.  The same holds true for the Short Threshold setting on the short side.


▾ System Template

▾ Signal Alerts

▾ Debugging

▾ Setup

Other properties in the Setup section are from NinjaTrader.  Please refer to NinjaTrader documentation for help.

The following sections are added by NinjaTrader.  They do Not come from BloodHound.
You can find an explanation for these sections and properties in the NinjaTrader Help Guide.

Data Series

▾ Plots