{quote} Recognize that you have half the price points needed to compute the current CMA. You can do a lot of things with those price points.
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FXEZ- can you please elaborate a bit on this. At any point of time, aren't there all data points to compute the current MA ? Or are you referring to projected MA ? Some clarification will be appreciated.
{quote} FXEZ- can you please elaborate a bit on this. At any point of time, aren't there all data points to compute the current MA ? Or are you referring to projected MA ? Some clarification will be appreciated.
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aptx, the current moving average (SMA) of 32 price periods has a lag (n-1)/2 or about half the length so let's call it 16 bars of lag. So to center the 32 length moving average on the current bar, you need about 16 bars of future price data to compute the average (CMA) that is centered at the current bar. I hope that makes it clearer.
{quote} aptx, the current moving average (SMA) of 32 price periods has a lag (n-1)/2 or about half the length so let's call it 16 bars of lag. So to center the 32 length moving average on the current bar, you need about 16 bars of future price data to compute the average (CMA) that is centered at the current bar. I hope that makes it clearer.
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Yes I do get the English :-) but your comments have more depth than the simple use of words. :-)
{quote} Just highlighting a possibility- in case you believe in wave theory :-) {image}
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I believe that focal points(FP) form at equally spaced time intervals and these FPs will form at the centreline of an intact channel.
"IF" my theory is correct, the next pink FP is due by about the end of this month. If the pink channel is still intact this FP needs to form at the centreline of that channel.
This is now looking extremely unlikely, and if that is true, the pink channel has now been broken, meaning the path you drew is not likely to occur.
{quote} Just highlighting a possibility- in case you believe in wave theory :-) {image}
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aptx our problem is that it exists no "wave theory" we can trust and apply in the real market as well as it exists no "cycle theory" too
you will find tons of documentation on this thread about both subjects by searching wave or cycle.
It is obvious that every "wave theory" is influenced and is a side product of Elliot Wave theory, which is now obsolete .
The key to understand waves and cycles and what is the problem is to clarify the confusion created by "theoricians" themselves.
Let' us analyze the original first writings of R.N. Elliott " the Wave Principle". 23 pages you will count 100 occurences of the word cycle, cyclic and cyclical and 20 times the word "rythm" . You will note that Elliott does not give us a definition of what is a cycle, what is a wave and what is a rhythm/
As for Hurst nobody seems to have really understood what he wrote . If you consider his course , the Cyclitec Course, 1.400 pages ,you will find 5.016 occurences of the word "wave" and only 810 occurences of the word "cycle, cyclic, cyclical".
None of the guys using Hurst concepts seem to have noted that Hurst himself describes his work and research as "the Wave theory of Price Action" .
Hurst even refers to Elliott in the introduction of the 32 pages booklet " Cyclic Analysis " where he summarizes his research and methodologies
{quote} Just highlighting a possibility- in case you believe in wave theory :-) {image}
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Hurst is the only guy I know defining the relationship between wave(s) and cycle(s)
Hurst tells us that a "cycle" is the repetition of the same "wave"
Price Waves
• A price wave is a simple, symmetrical, and infinitely repeating oscillation or fluctuation in price from a trough to a crest and back again.
Figure 1-1 is a graphic illustration of the shape of such a price wave.
• A single repetition of a wave movement is called a cycle.
In figure 1-1 2 complete cycles of a single wave are shown. i • Note in figure 1-1 that a single price wave varies above and below zero price, hence can take on both positive and negative price values.
• Stock and commodity prices cannot, however, be zero or negative.
As we will see later, prices vary in this wave-like manner about some positive price level that is high enough so that prices never become zero or negative.
Study figure 1-1 with care until you have absorbed the meaning and n implications of this simplest of wave concepts
A simple, single price wave of the kind that combines to form stock and commodity price action.
Only 2 cycles of this wave are shown, but the wave itself extends infinitely far to the left and to the right.
Such waves repeat themselves cycle after cycle.
As a result, once the wave is identified, its value can be determined at any past or future time.
It is this characteristic of waves that provides a degree of predictability for equity price action.
{quote} Hurst is the only guy I know defining the relationship between wave(s) and cycle(s) Hurst tells us that a "cycle" is the repetition of the same "wave" Price Waves • A price wave is a simple, symmetrical, and infinitely repeating oscillation or fluctuation in price from a trough to a crest and back again. Figure 1-1 is a graphic illustration of the shape of such a price wave. • A single repetition of a wave movement is called a cycle. In figure 1-1 2 complete cycles of a single wave are shown. i • Note in figure 1-1 that a single price wave...
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The practical application becomes difficult because the line drawn through the centre of the cycles does not continue in a straight line forever(ie the underlying trend). It changes direction. Identifying those direction changes is, I believe, the key to successfully applying cycle analysis to the real market. Hence, my theory above.
in fact I am now convinced that even Hurst himself was not clear in his mind of what is a "cycle " and what is a "wave" because his definition of a cycle A single repetition of a wave movement is called a cycle.is different pf the chart he posts to ilustrate it " 2 Cycles of a Price Wave"
Edward Dewey as soon as the fifties tried to clarify the subject in the magazine "Cycles" of the Foundation of the stucy of Cycles (FSC).
Dewey uses also the word "wave"
Dewey focused mainly on "Cycles" identifying :
regular / rigid cycles (fixed period) dynamic cycles or "rhythm" (variable period tending to an average one)
Dewey even wrote (in the magazine "Cycles") that we should use the expression Rhythmic Analysis much more than "Cyclic Analysis" ... but did not renamed his magazine accordingly.
{quote} I believe that focal points(FP) form at equally spaced time intervals and these FPs will form at the centreline of an intact channel. "IF" my theory is correct, the next pink FP is due by about the end of this month. If the pink channel is still intact this FP needs to form at the centreline of that channel. This is now looking extremely unlikely, and if that is true, the pink channel has now been broken, meaning the path you drew is not likely to occur.
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With you. But would suggest re- reading Tillman's "Technically Speaking" interview on the same. There is a hint there :-)
As for myself I stick to Hurst Definition : A single repetition of a wave movement is called a cycle
This definition is incomplete if we look at the charts Hurst used as illustrations
Hurst showed us :
- 2 successive Price Movement going from a Low Level to a Top then the same Low Level - this Price Movement has an Amplitude A (at the Top) (Dewey used the word Strength) - this Price Movement has a Period P (duration)
Technically and practicall :
a) you identify a Wave going from a Low level L to a top T then to the same level L b) you identify a second Wave having identical parameters Amplitude and Period c) you are happy you have a "Cycle" d) the famous analyst Parisboy wrote : If you want to trade your "cycle" in the real life you need that Price Action build a Third identical Wave (Amplitude , Period) to make some money
questions :
- what if the Period of the Third Wave is shorter or longer ? - what if the Amplitude of the Third Wave is shorter or longer ? - what if the Period and the Amplitude of the Third Wave are shorter or longer ?
Hurst allows us some flexibility that is the Principle of Variation
but how much flexibility ? at which point a significant modification in Amplitude or Period or both parameters changes the nature of the Wave and then neutralize of the previously identified cycle ?
the Sentient Trader software seems to allow a 35 % variation in Period Sentient Trader does not care very much about Amplitude (strength)
such an allowed variation raises questions (to be followed)
let's supose you have a theoretical 9 months "cycle" a 35% variation is 3 months then a 6 months cycle or a 12 months cycle could be labeled as a theoretical 9 month cycle to fufill some analysis need or model.
This is obviously a source of confusion and even errors
Analysis and Trading based on Envelopes, Waves, Cycles
