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  • #61
  • May 15, 2007 8:17pm May 15, 2007 8:17pm
OK. so this topic has some legs.

What if the simple answer is "Noise"

How do we Differentiate Noise from pit reality? The elusive 3rd dimension ?
How do we discern that the "Current overshot is due to lack of education as opposed to continuation/reversal as determined by the Pit?


The question remains, Can this be "Visualized"?
  • #62
  • May 15, 2007 8:17pm May 15, 2007 8:17pm
Well there's a question!

And here is my customarily pedantic answer;

Yes!
  • #63
  • May 15, 2007 8:20pm May 15, 2007 8:20pm
That was aimed at the previous post, ya just beat me in there i think!
  • #64
  • May 15, 2007 8:24pm May 15, 2007 8:24pm
Hey Ted,
Glad you are intrested in the thread.
Hang in there....
An answer {I believe} is forthcoming.
  • #65
  • May 15, 2007 8:29pm May 15, 2007 8:29pm
How about using trend length and depth/height, which could be measured in pips per hour for a laugh. Then using a constant relating to the average cycle length of the market, we can ascertain whether the market should become exhausted and undergo correction, or not.
I seriously doubt this is of any real applicable value though, just a thought?
  • #66
  • May 15, 2007 8:46pm May 15, 2007 8:46pm
Quoting Ted1983
I seriously doubt this is of any real applicable value though, just a thought?

Oh No... At this point, I seriously believe that "Cycle Length" has a part to play in this scenario.
Reason: Perhaps Cycle Length = Diameter?
I [at this point] see a 3D Chart as if looking at a metal spring from the point of the Horizontal axis but 25 degrees horizontally askew from that point.
The "Cycle Length" is perhaps being filled as it moves away from {or toward} me in the 3rd Dim which is what I cannot see in 2D.

Now your onto my verve & perhaps you may find it as intriguing.
  • #67
  • May 15, 2007 9:34pm May 15, 2007 9:34pm
Aaah Bemac, you read me wrong old chap.

I know absolutely diddley squat about trading, never traded a real cent in my life. Thats why I peruse these boards trying to hone my as yet untried methods. (Going live in September.)

Thing is every thread I read I get dragged into some debate about quantum mechanics or relativity, which I have a reasonable level of knowledge on, albeit anecdotal.

However If I can contribute anything that would be great, and I would like input from the experienced folk out there like yourself. That said how about this for an idea;

If we wish to measure acceleration of a market we simply plot the first order differential thingy of a suitable MA, thus giving its rate of change. This could give an insight into whether a trend is fundamentally valid, or simply just letting of steam. I say this cause I have noticed sustained daily trends (like USDCAD at the moment) seem to move in a simple uniform manner, whereas "fakeouts" appear to be characterized by sudden expansion.

What d'ya reckon?
  • #68
  • May 15, 2007 9:44pm May 15, 2007 9:44pm
Quoting Ted1983
How about using trend length and depth/height, which could be measured in pips per hour for a laugh. Then using a constant relating to the average cycle length of the market, we can ascertain whether the market should become exhausted and undergo correction, or not.
I seriously doubt this is of any real applicable value though, just a thought?
I started this thread in another forum, nobody there even made a squeak about it... This might hold a key to identifing trend strength/length/height/etc...

I am hoping that someone has already developed an indicator based on this formula. The following 2 links illistrate the idea.

1) http://www.reactionaryeventmodel.info/#02
2) http://www.reactionaryeventmodel.info/addition0002.htm

The basic idea is trend identification by scaling through multi times frames, but looking for a specific pattern structure.

It would help to display multipule time frames on the same chart. Maybe use a different linear bar for each time frame in a subchart..? Donno..? Anyhoo, thanks in advance for your help and ideas...

Enjoy...? lol...
{Promotion Removed}
  • #69
  • May 15, 2007 10:22pm May 15, 2007 10:22pm
Quoting Ted1983
If we wish to measure acceleration of a market we simply plot the first order differential thingy of a suitable MA, thus giving its rate of change. This could give an insight into whether a trend is fundamentally valid, or simply just letting of steam. I say this cause I have noticed sustained daily trends (like USDCAD at the moment) seem to move in a simple uniform manner, whereas "fakeouts" appear to be characterized by sudden expansion.

What d'ya reckon?
*Note* All MA Bashers banned. {from this thread [for now]}

Interesting Ted.
Could you put

"the first order differential thingy of a suitable MA, thus giving its rate of change. This could give an insight into whether a trend is fundamentally valid, or simply just letting of steam."

into more of a FX definition?

...
  • #70
  • May 16, 2007 6:50am May 16, 2007 6:50am
I have a perfect idea for a third "Variable".

Somebody in this forum has to know some computer hacker. He could hack into all the big brokers in the reuters system or something and we somehow graphically list all the upcoming orders graphically.

Or we could bug all the big dealers desks and use them collectively as pit noise version 2.0.

After I think about- I am having nothing to do with anything possibly illegal. Especially after my real name is listed in the username signup sheet. The last thing I need is some "Black" NSA data mining program putting two and two together and somebody wearing a black suit knocks on my back door.

Somethings are better not discussed or theorized on a public forum!
  • #71
  • May 16, 2007 9:04am May 16, 2007 9:04am
Quoting PipRippy
I have a perfect idea for a third "Variable".

Somebody in this forum has to know some computer hacker. He could hack into all the big brokers in the reuters system or something and we somehow graphically list all the upcoming orders graphically.!

isn't that simplified and called as "volume"? we even can predict which side is winning by seeing the price itself...... somewhere in this forum i see somebody said that it is forbidden to tell the market how much the volume in number thou.

ps: is it that long for an order to be realised that we can take advantage?
  • #72
  • May 16, 2007 9:13am May 16, 2007 9:13am
As I said previously, I dont really have a clue when it comes down to it, but if we were to measure the dominant cycle time (in various time frames) then apply a MA corresponding to this, its rate of change could be plotted as a histogram.

(Is this what MACD does already, I dont know, and can't be arsed to look up the formula.)

I mention cycle time because this I believe may be dictated by the underlying psychology of its participants, especially on lower time frames, waves of fear and greed, probably like when you've just downed half a bottle of sambucca!

Therefore some kind of rate of change could give an insight into just how fearful and/or greedy the collective is feeling.

Problem here is I might just be trying to re-invent the wheel.

Also that hackneyed argument of trying to reduce crowd psychology to a set of statistical rules should raise its' ugly head in a few posts time!

I think the only practical value of such an exercise might be in avoiding jumping on the gravy train just as its about to crash. If we can ascertain the
"likely" length of a rally or decline based on the above premise then we might avoid buying tops and selling bottoms in our eagerness to join the party.

Put simply, I'm postulating that a genuine trend may exhibit a particular phases of acceleration lasting a "predictable" length of time based upon previous observations.

Of course the next objection will be the past history future performance
debate, but I believe this is flawed, because people tend not to learn from past errors, but carry on regardless in their vain attempts to get rich.Basically old succesful traders retire/die and wannabies like me spring up to try and fill their cream slip ons.
  • #73
  • May 16, 2007 11:01am May 16, 2007 11:01am
Well Bemac,

I was just walking round Tesco (the mighty machine, which alledgedly consumes 1/8 of all pounds spent in Britain) thinking about this spring type model you talked about.
Do you think something akin to the Youngs modulus might be appropriate to give a proxy for the "stretchednes" of the market.
Of course this assumes we have a constant value for its ability to absorb stress/strain already.
BTW where does the 25 degrees of skew arise from which you mentioned above?

As I type this it sounds quite ridiculous, however remember the Bollinger band hypothesis relies on the market being normally distributed, which seems far too simplistic a view of a complex process.

It is just as likely that a financial instrument will obey some other distribution,
if there's somebody out there who is good at sums maybe they could take a look at the Poisson distribution which Wikipedia describes as;

"a discrete probability distribution that expresses the probability of a number of events occurring in a fixed period of time, if these events occur with a known average rate, and are independent of the time since the last event."

Certainly sounds like that could be applied to incoming ticks because the distribution requires, "a known average rate" Then if the rate exceeds a particular threshhold we may be experiencing a "Poisson breakout".
  • #74
  • May 16, 2007 11:41am May 16, 2007 11:41am
Quoting Bemac
*Note* All MA Bashers banned. {from this thread [for now]}

Interesting Ted.
Could you put

"the first order differential thingy of a suitable MA, thus giving its rate of change. This could give an insight into whether a trend is fundamentally valid, or simply just letting of steam."

into more of a FX definition?

...
He means slope of the MA. I've used slopes of other indicators before, to mediocre success.

andersenws
"Youth is the trustee of prosperity." - Benjamin Disraeli
  • #75
  • May 16, 2007 2:55pm May 16, 2007 2:55pm
No I don't mean the slope of the MA.
  • #76
  • May 16, 2007 3:01pm May 16, 2007 3:01pm
I mean its rate of change, which could be second order I suppose. My mistake.
  • #77
  • May 16, 2007 7:14pm May 16, 2007 7:14pm
Quoting PipRippy
I have a perfect idea for a third "Variable".

Somebody in this forum has to know some computer hacker. He could hack into all the big brokers in the reuters system or something and we somehow graphically list all the upcoming orders graphically.

Or we could bug all the big dealers desks and use them collectively as pit noise version 2.0.

After I think about- I am having nothing to do with anything possibly illegal. Especially after my real name is listed in the username signup sheet. The last thing I need is some "Black" NSA data mining program putting two and two together and somebody wearing a black suit knocks on my back door.

Somethings are better not discussed or theorized on a public forum!
I have had the ebs data in the past. It does not translate as well as you might think. You can see the order, volume, size, etc... but that doesn't mean that the orders will stay there... Orders come and go a lot. They will post orders and then just before the price is reached, they pull them. At best, ebs (type) level 2 info could only be used for small scalps... and it's darn pricy..!

Unless we could define or identify patterns. Meaning: how the different banks and hedge fund post/pull the orders... hmm... wonder if any of the big boys have even thought of that... Sort of a hist or MA of order history..? Maybe completely ignoring price is the answer, lol...
{Promotion Removed}
  • #78
  • May 20, 2007 9:31pm May 20, 2007 9:31pm
Wow, no replies in awhile...? I hope everyone's not thinking too hard... lol...
{Promotion Removed}
  • #79
  • May 20, 2007 10:22pm May 20, 2007 10:22pm
Quoting riffster
Wow, no replies in awhile...? I hope everyone's not thinking too hard... lol...
Patience my friend., Patience:
  • #80
  • May 20, 2007 10:32pm May 20, 2007 10:32pm
Quoting Ted1983
Well Bemac,

I was just walking round Tesco...

"Poisson breakout".
As has, apparently, been realized; My Crack has not as yet been posted as absolute. But it does seem to have got some people thinking.

More concepts please...






I will post a refined Version his week.
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