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Examples: Equivolume Charting Revisited

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MetaQuotes Software Corp.
Moderator
181078
MetaQuotes Software Corp. 2008.01.28 21:52 

New article Equivolume Charting Revisited has been published:

The article dwells on the method of constructing charts, at which each bar consists of the equal number of ticks.

The idea of accounting for volumes when constructing a chart was expressed already in 1871 by Richard W., Jr. Arms in his book "Profits in Volume, Equivolume Charting". Bars on charts constructed using his method had different width - the larger the volume is, the wider the bar is.

Fig.1 Example of an Equivolume Chart

Really, technical analysis, especially relating to stock markets, accounts not only for the price, but also for the volume of trades. There are numerous indicators and forecast methods based on the analysis of volumes. So, in addition to them equivolume charts were created.

In conditions of Forex markets where a trader does not possess information about the real volume of trades, the assert of using equivolume charts is rather doubtful. Like many other methods of technical analysis, the analysis of volumes is less effective than for stock markets several decades ago. Still, this does not in any way hinder those who try to find regularities that will help to gain stable profit in this unstable market.

The purpose of this article is adding one more very useful tool - equivolume charting. Please note that the implemented equivolume charting is different from the one described by Richard Arms. In our case it will consist in balancing bars by constructing them from the same number of ticks. Thus a bar will be calculated not in time (the number of minutes), but in the number of price changes.

Author: Andrey Khatimlianskii

tradelover
6
tradelover 2008.01.29 12:37  
Nice work.

There was some discussion on some parallel forums in the past, related to tick-charting.
If someone need an indicator to paint such fixed-tick-charts in real time, then please visit my blog, where such indicator is posted.
MisterH
1131
MisterH 2008.01.29 17:22  

Nice work indead but I think there's just one problem with this: a tick is a measure of time, it's not a measure of distance: Let's not confuse ticks with pips: a tick is simply the next price, a pip is the minimum price change possible (e.g. 1 pip in EUR/USD is 1/10.000 of 1 euro). A 50 pip tick (like on the monthly non-farm payrolls anouncement) is perfectly possible (which means that the next price level compared to the previous one is 50 points/pips higher).

So instead of expressing the candles as a number of ticks (like 20 ticks in this example), wouldn't it be better to use it as a new sort of timeframe that doesn't close the bar untill the next one is (e.g.) 20 PIPS lower or higher than the first price of the bar or the last price of the previous bar?

tradelover
6
tradelover 2008.01.30 09:57  
@MrH
Sorry, but you did not get the point. Please read the article again :D
You talk about different charting method, with fixed size (i.e. 20 pips) for candles, that exists already, is called Renko charting and it is not subject of this article. This article is about EV charting. And yes, if next tick is 50 pips long, you WILL have a 50 pips bar in your EV chart.
Peace!
MQL4 Comments
16319
MQL4 Comments 2008.06.25 19:13  

Hi,


This is great work, most of MT4 user were looking for ticks charts based, now its ready :)


I have one more question;


1. Let say, after downloading the data from gain server for the first time, then we compile it, and follow your steps, we should be able to get the ticks chart (100 ticks chart) real-time with historical data (from gain server). What will happen if we close MT4 and re-open it back the next day, do we still need to re-download the ticks data from gain server and apply them agian and again?

Andrey Khatimlianskii
136
Andrey Khatimlianskii 2008.11.18 06:02  
moneymate8:

I have one more question;

1. Let say, after downloading the data from gain server for the first time, then we compile it, and follow your steps, we should be able to get the ticks chart (100 ticks chart) real-time with historical data (from gain server). What will happen if we close MT4 and re-open it back the next day, do we still need to re-download the ticks data from gain server and apply them agian and again?

Read the article attentively, it is said about the charts update.
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