FOREX and ECONOMETRY. Theory, practice, forecasts and implications - page 9
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Technical analysis is about specific methods and patterns.
Anything that looks for patterns within a series is not just TA
Technical analysis is about specific methods and patterns.
Anything that looks for patterns within a series is not just TA
I will try to introduce my view of the problem. I have taught econometrics at the Institute of Economics and Trade for 10 years and have come to the conclusion that econometric methods alone cannot solve the processes and problems of trade. The main task of econometrics, as it is presented in many textbooks, is to describe the existing economic data with a function that best covers a specific range of parameter changes, beyond which there is no guarantee of describing the process. Why is this the case? Because, from the outset, no logic inherent in the trading process is laid down. The data is treated as a dry chain of actual values of the target function for different values of the parameters. There is still no mathematical model of the market and the nature of market price formation. References to supply and demand are made to divert the eye from the true depth of the lack of knowledge in this area because, there is no single mechanism for accounting and evaluating supply and demand. Out of the fog we are thrown into the darkness of the unknown. So it is up to us to formulate different hypotheses about the nature of the market and test them on the basis of all available history, accepting or rejecting them one by one. That's what we will try to do, if everyone doesn't mind.
I will try to present my view of the problem. I have taught econometrics at the Institute of Economics and Trade for 10 years, and I have come to the conclusion that econometric methods alone cannot solve the processes and problems of trade. The main task of econometrics, as it is presented in many textbooks, is to describe the existing economic data with a function that best covers a specific range of parameter changes, beyond which there is no guarantee of describing the process. Why is this the case? Because, from the outset, no logic inherent in the trading process is laid down. The data is treated as a dry chain of actual values of the target function for different values of the parameters. There is still no mathematical model of the market and the nature of market price formation. References to supply and demand are made to divert the eye from the true depth of the lack of knowledge in this area because, there is no single mechanism for accounting and evaluating supply and demand. Out of the fog we are thrown into the darkness of the unknown. So it is up to us to formulate different hypotheses about the nature of the market and to test them, accept or reject them one by one, on the basis of all available history. That is what we will try to do, if everyone agrees.
Indeed. It is advisable to dispel the fog, otherwise we will fall into darkness ourselves if we create the wrong theory and consequently the wrong strategy.
A market model has to be created, the right model.
We will deduce and write formulas later, I don't think it's a problem.
No one understands you and no one will understand you unless you either start writing formulas or start formulating a clear solution.
And you operate with sensual images and incomprehensible graphs.
Let me try to explain in details.
We take the value of the quote on the zero bar and take it as a constant.
We create an array in the indicator where we bring the difference between the constant and the quote value on the current bar and so on.
We obtain a market model, in which each bar will be assigned with this difference.
In this case some values will be positive and some will be negative.
Then I start summing up the array values obtained beginning with zero (last bar to the right) with the only purpose - to obtain a sample of time series, in which the sum of values will be equal to zero.
As a result, I get that the sum will be equal to zero only on the penultimate bar of the created array.
What a strange question about where the quote for currencies comes from... Who issues the currency? The central bank. Who borrows currency from the central bank - commercial banks. How is the exchange rate set for a particular currency? based on supply and demand. How is the exchange rate equalised between commercial banks? through arbitrage. What does this have to do with exchange-traded futures? nothing at all, it is a derivative instrument that depends on the underlying. Where does the data in the terminal come from - from the interbank ECN. Learn the basics, Gostpoda, if you try to call yourself traders :)
All ...
Anton, what would you say about this, what would happen to the exchange rate if:
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FOREX and ECONOMETRY. Theory, practice, forecasts and consequences
Renat Akhtyamov, 2017.01.21 12:22
Ok.
And yesterday - there was a major euro buyback as well.
What will it be - up or down?