Hodrick-Prescott filter - page 7
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And how do you keep MM in this state of affairs? After all, you need to know how much the currency will change by.
You can start from the drawdown, which TS shows on the history, or from SL, which is also calculated based on this drawdown, but it can be increased and decreased relative to this drawdown. True, there is one drawback - when volatility increases, the drawdown may increase, but then you don't need to sleep, but keep your eyes open, if the market undergoes such significant changes in its behavior....)))))
You can see that agreement is not bad. Which is what we need to prove. All other cases involving different implementations of muwings do not change the essence of the statement, only the method of proof is varied.
Thanks, Neutron. At first approximation it looks like differentiation. (In your formula, another assumption is that 1/n ~ 1/(n+1) - which holds for close periods. And if the difference is 2 times, unlikely).
By the way, on the figure: will the MA70-MA100 phase be better than the other two? or does it just seem?
I don't know how anyone here thinks or thinks, but in my mind and concept, predicting price series or price range increments was abandoned 10 years ago - due to the futility and low profitability of this activity...... ))))
What about neural networks? They were abandoned at the same time or even earlier. Take, for example, SVM, which are much more modern. But we are in the old way...
I used to buildneural networks, about 20 years ago. It wasn't even called that yet. They were R&D on recognition, and it was then that the mathematics of these procedures were written. I later saw these procedures in funder, the ones we were counting and creating, hoping that they would replace the human brain, but no, they did not. To think in advance that others are smarter than you, is a failure.
Regarding prediction, one argument so far is that it's easier to predict the direction, yes I agree, easier. But that doesn't mean it's better.
Prival, that's just cool, except for the historical fact that the term "neural networks" was formed in the 50s, and it is believed that the first paper (published), appeared in 1943 describing the neuron modell.
Thank you, Neutron. At first approximation it looks like differentiation.
Thanks for the kind word.
By the way, from the picture: will the phase of MA70-MA100 be better than the other two?
I don't know which is better. If you need the first derivative, it's better when the periods are different by 1. By the way, if we put a moving average on the series of the first difference of the initial BP, we get the same result as above - the first derivative of the quotient's moving average with the same smoothing period. If we take the ratio of two muwings, we also obtain the first derivative + 1.
We can see that this world is the same in all its diversity, and that is great! The main thing is to see it all.
Neutron, I saw your beautiful calculations and remembered my own stupid attempts to grasp the nature of the formidable and dual MACD.
This is because it is not some smart indicator, but one of the basic trader's tools that every beginner hears on the second day of his classes at the traders' school. On the other hand, what a beautiful name it has, "MA Convergence-Divergence" that immediately brings the most majestic associations from vector analysis and inspires respect for it from the very beginning. Well, it means that traders use it for a reason, as almost in every second chart of the most prominent analysts profoundly discuss it and analyze its divergences. And I tried to touch even a part of MOSK to this mystery, so that having thoroughly understood what function of prices we deal with, we could receive the formula of happiness allowing us to make criteria of entering (or leaving) a position.
I will add here a small confession. After all, I have never studied at any trader's school and I dared only to learn what the Great MACD is a few months after I had learned what muwings are. Yes, yes, I was afraid of him! In my awe of its name, I tried to approach the profound wisdom of this indirector gradually, only after a solid assimilation of simpler indirectors. And even after I'd seen his formulas (sic! not interpretations of his signals, but just the formulas!), I couldn't believe for some time that such a simple arithmetic causes such complicated and deep interpretations for a practical trader. Frankly speaking: I still don't know the mechanism of this magical transformation from the simplest formulas to the most powerful and profitable practical recommendations for traders. And lately I'm more and more inclined to think that interpretation of MACD is a trivial PR in order to hide a formula emptiness of this structure and to embellish it for beginners who want to make millions out of it.
I've got the MACD formulas themselves, Neutron, they are not too complicated, but I will not post them here in case there is something secret in them. The MACD itself including the EMA is somehow related to the discrete integral Laplace transform of the price flow. But I do not see any magical interpretation allowing to predict what will happen to the price later (or at least to see what is happening to it now) based on its value or behavior. I can't see or imagine any divergence (trader's divergence) popping up there. And no matter how many times I am told that by trading the MACD we are trading something meaningful, I still think it is trading pure noise.
This is the place for you.
Interesting formulas. But I'm not talking about formulas. I just asked why you open position with certain lot, if you don't know how many points currency will go up or down, because few losing trades in a row may spoil euphoria of managing possible big money, as it happens in the beginning of trading, if you don't use tight MM.
Calculating psychology. Indicators can be made up of anything, but whether many traders use them or not is a big question.
to Mathemat
Lapses here and there don't matter, the main thing is to know why,
e.g. Ideal Ball in a perfect fluid flow -> wing profile.
Or a Zhukovsky lever balanced by the sum of all applied forces including inertial forces.
What's in trade?
Well there is the student's integral, can you come up with a sceptic's lever?
That's my point, Korey. MACD is the student's integral. It's not me who goes back and forth on Laplace, it comes out on its own when I reduce MACD to a formula of happiness. And why it is needed there - that is the question.