Moving Averages

[bonsai]

Bramble

you may not be right.

Have you read J.M Hurst on the subject ?
There may be more to ma's than you would have thought.

 

[GruntnoWay]

bonsai, thanks, i understand now.

 

[BBB]

Thanks to Skims chart, it looks like a forward displaced MA could be used to curve fit a profit protecting stop.

I still dont get the concept of the being 'forward looking' though.

 

[GruntnoWay]

This is all very interesting. I'm getting into it now. I have been experimenting with different average calculations and shifting them back and forward. I seem to be getting good results with one called Adaptive and of course indexia type i have used for years. Next step is to try optimising them. I will let you know the results :cheesy:

 

[TheBramble]

Bramble

you may not be right.

Have you read J.M Hurst on the subject ?
There may be more to ma's than you would have thought.

Well Bonsai, I'm willing to drop an opinion and immediately reverse it at the drop of a hat, but apart from the psychological, self-fulfilling prophecy aspect of MAs that I alluded to, I've not been able to convince myself that they are a worthwhile investment of time or effort.

Just a personal opinion.

Are you recommending Hurst?

Does Hurst's work go into anything other than the standard derivation, use and interpretation of MAs?

 

[GruntnoWay]

I have looked at Hurst. There is nothing about trading with moving averages. Its all to do with cycles and channels. Its like that program from Cheshire - can't remember the name now. You have to extend the averages manually to the end of the data. Its like guessing

 

[kevin546]

IMHO There is nothing better than price action to make your assessment. The problem is many including me cannot always get it right just from the price alone.

Personally I feel the most valid comment on this matter came earlier from Bonsai it is how you use it. Remember we are told to look for an edge. If you followed just what was said in the charting books on how to use a particular indicator in its conventional form then you never consider looking at the larger picture and how specifically an indicator used differently to the conventional method may actually provide better signals, IMVHO

 

[bonsai]

Bramble

Well its up to you. But there is a lot more to it than just picking any ma that you think might be useful.


Grunt
I'm not sure how to respond to that.
Perhaps you haven't read enough of the man's approach
or perhaps you have just skimmed through many of his studies.

anyway, its up to you.

 

[GruntnoWay]

Skimmed? Yes I couldnt understand the maths

 

[bonsai]

understand

if it's any consolation, I found the english somwhat prosaic and
not all that easy to follow.

as an engineer, he is a "proselyte of the gate" of trading ?

 

[oatman]

Grunt, how do you get on with Indexia's Moving Average Manager? I could never get any edge from it.
I'm not running Indexia at the moment.

 

[GruntnoWay]

Oatman. I used indexia a few years back and then switched to metastock and always missed the indexia tools like the averages. I dumped metastock a few months back and now have updata ta and the indexia averages back. i really like them on short term term charts like 1 minute and 15 minute. they are more reactive to trend changes. other averages are too slow

 

[trendie]

Can anyone explain the formula for Indexia MAs, please ?

( they seem to flow better on my charts, especially when displaced, but I need to know whether I am curve-fitting )

PS: has anyone tried Adaptive MAs ?
What I like about them is the way they flatline when the market gets volatile and rangey, turning it into a trend/range indicator !!

 

[GruntnoWay]

i would like this explained as well. I use the indexia mas all the time and would like to know more.

 

[trendie]

I did a google for indexia, and they are "proprietary" and a trade secret !!
So a full explanation / description / formula is unlikely.
Unless anyone knows better.

I do like using them, but am a bit wary of relying on a mechanism I dont understand the underlying formula for. However, they are good !

 

[GruntnoWay]

that explains it. To be honest i don't care too much for calculations. if the indicator works thats good enough for me. look on the bright side, no-one outside indexia will be able to use them

 

[GruntnoWay]

i use 13,21,34 fib numbers. sometimes 5,8,13 for short term. but always 3. i remember jerry duplessy saying once that indexia averages worked best in 3's

 

[Brand]

Totally agree with the not what you use, but how you use it statement.

Of course if you use ma crosses as is, you will always be behind the market action.

Sometimes that is no bad thing. Gives the 'noise' time to settle down. Great in trending markets for longer periods. No good of course to the scalper/short time frame trader.

Displaced mavs have the same input by filtering 'noise'

Then you have the predictive abilities, that can also come with mavs and macd; dependant on settings.

"Beauty is in the eye of the beholder."

I know a ma will always be behind the market action,so what would you use to get infront of the market action.? Thanks, Brand

 

[Charlton]

Leading and lagging indicators

I know a ma will always be behind the market action,so what would you use to get infront of the market action.? Thanks, Brand

Brand

First I will say that I personally don't use indicators, but to answer your question. Indicators fall into 2 main camps: trend-following and momentum and the most appropriate ones to use depend on your style of trading.

Trend following, such as MA, lag market action, but are useful to indicate the broader picture and to filter out noise. Momentum indicators such as RSI and Sochastic are designed to identify the pace of market action and attempt to provide buy/sell signals at times when the rate of activity in a particular direction is changing. Its like measuring the acceleration/decceleration. They are used in swing trading to identify turning points.

Fibs were mentioned earlier in the thread. I don't regard these in the same light as indicators because they are based on a set of external parameters i.e. the fib numbers. If you believe in them then they, too, are predictive.

Indicators are derivatives of price e.g. averages or even averages of averages. That is why I and many traders on T2W don't use them, but like all these things if they work for you then fine.

Charlton

 

[Brand]

Brand

First I will say that I personally don't use indicators, but to answer your question. Indicators fall into 2 main camps: trend-following and momentum and the most appropriate ones to use depend on your style of trading.

Trend following, such as MA, lag market action, but are useful to indicate the broader picture and to filter out noise. Momentum indicators such as RSI and Sochastic are designed to identify the pace of market action and attempt to provide buy/sell signals at times when the rate of activity in a particular direction is changing. Its like measuring the acceleration/decceleration. They are used in swing trading to identify turning points.

Fibs were mentioned earlier in the thread. I don't regard these in the same light as indicators because they are based on a set of external parameters i.e. the fib numbers. If you believe in them then they, too, are predictive.

Indicators are derivatives of price e.g. averages or even averages of averages. That is why I and many traders on T2W don't use them, but like all these things if they work for you then fine.

Charlton

Thanks for the help.