Say you have a Fibonacci retracement:
http://i.investopedia.com/inv/articl...etracement.gif
What is the best way to represent the motion of the price and interaction with the Fibonacci levels at each bar using the fewest continuous variables? (After the fib is established).
I can of course use a single continuous variable that technically captures everything - position of the price in percents between the fib's 0% level and its 100% level - but then the discrete nature of the actual Fibonacci levels is lost.
I want to do this so that I can feed a data mining software (say, neural network) input that captures the price's behavior around fib levels.
Any ideas?
http://i.investopedia.com/inv/articl...etracement.gif
What is the best way to represent the motion of the price and interaction with the Fibonacci levels at each bar using the fewest continuous variables? (After the fib is established).
I can of course use a single continuous variable that technically captures everything - position of the price in percents between the fib's 0% level and its 100% level - but then the discrete nature of the actual Fibonacci levels is lost.
I want to do this so that I can feed a data mining software (say, neural network) input that captures the price's behavior around fib levels.
Any ideas?