Consolidation sort out

[hansgust]

Hi
I’m trying to create a trading system, and I have come to the point to sort out consolidation periods. And I mean consolidation periods with very small movements.

To sort out those movements I’m trying to calculate the angel of a moving average. And sort out when the angel is flat. I found the atan function in metastock, but I can’t find out how it works. Any tips? Our other calculations that show the angel of moving averages?

Best regards

 

[Adamus]

Won't the angle of the MA depend entirely on the compression ratio you set for the window, i.e. the number of bars you're showing?

By the way, there is a metastock subforum where other people may give you more useful info. I'm a TradeStation user.

 

[MrGecko]

couldn't you figure it out in excel?

if you said now = T(0), and 20 periods ago = T(20) (e.g. 5 periods ago = T(5), and so on)

then set MA @ T(20) = 0, and record the change per period, approximating it to a triangle

T(1) - T(20) = adjacent of triangle

19 = opposite (the "length" of the data points, 20 - 1)

=> angle of MA = [90 - (Tan^-1(19/(T(1) - T(20)))] * -1

something like that anyway, the idea is to draw an imaginary right angled triangle between the MA line and the x axis. Of course the sample size you chose for the "opposite" would depend on all sorts, the smaller the length the more volatility you'll get.

good luck.

 

[MrGecko]

a second thoughtt is to draw a tangent to the MA at the point you want to measure it, make a triangle, and so on.

Far more accurate, but I don't know how you'd draw a tangent without good old pencil and paper. Maybe someone else can help.

OR, on second thoughts, just make your "opposite" length 1