Topic: Experimental indicator, anyone? I give you the... reversal index - page 3. (Read 5119 times)

LOL. I first meant "couple of months' but then was not sure how long you will keep it up. Good catch

2014-06-04, 11:11 PM CEST

CI = 58
current main trend: up
price at calculation: $645

Are you suggesting that in a couple of weeks from now the dominant trend could be anything other than 'up'?!?

...

BURN THE HERETIC!

Yes, thanks! Especially if we would like to revisit a couple weeks from now it is very helpful to know what "current trend" estimation was at the time

I might not do TA very well, but I can code up a "hello world"

Yes. The CI value has to be seen in relation to the direction of the dominant trend. That trend is 'up' and CI value is slightly above 50, so the result of today says: unclear where we're going, with a slight bias towards continuation upwards.

EDIT: you're right, that wasn't very clear. I re-organized the presentation. Better now?

Ha, I wish.

If the thing is even remotely informative, I'll happily share the algorithm. I'd probably need some help anyway to fully code it... the tricky step I mentioned, 'determination of dominant short term trend' can probably be automatized through some combined analysis of BBW and ROC, but it's probably not quite as simple as looking at hard coded threshold values.

So when I say "I could code it in principle" I really mean "a more competent programmer than me could code it probably"

Oda, so currently "continuation" means more creeping up? That should be also clarified at the moment you post the values.

Interesting.

So if it works, you'll have us convinced because you've posted the predictions ahead of time.  However, we still won't know how to calculate your indicator.  Which means you can charge us top dollar for a subscription to your newsletter

Don't think I'll be able to do that. And I don't think it really matters... what ideally would happen is that the CI could help figuring out where we're heading if we are in one of those "in between" states that last for some days, i.e. not the shorter periods (think: flash crashes), nor the longer periods (think: bear market or bull market?). And for the time frame I have in mind, 1 or 2 hours early or late won't really matter much, I think.

Hi Oda;

Definitely looks interesting, and since it's coming from you, I'll keep an eye on it
Will your updates always be at the same time?

(EDIT)

Please see my posts further down this thread for the recent values of the indicator and my best suggestion how to interpret the output. Consider what I wrote below the following horizontal line obsolete.

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Been playing around with ideas to (mechanically) quantify the likelihood of short term trend reversals (or trend continuations). The method I came up with is defined well enough that I could in principle fully code and backtest it, but tbh, for now it's just easier to do the last step (which requires identification of some "dominant" trend in the recent past) manually. So, no backtesting yet, but instead: seemingly random numerical values! Everyone loves those, no?

I might go into more detail how I calculate the values later, but for now I'll just say that the calculation is based on some short-term comparative analysis of price trends. The value you get should be thought of like a classical oscillator:
values near 100 = certain continuation(edit: wrong way to describe the top value. The method is more reactive than predictive, so the correct way to talk about a high value is) no sign of reversal.
values near 0 = certain reversal,
values near 50 = outlook hazy, ask again tomorrow.

You might wonder what the "reversal" time frame is I try to predict here... I hope to pick up a reversal or continuation of the currently dominant short term trend I determine in the first step, which happens to be in the range of some weeks. In EW terminology that would be a 'minor trend' I suppose.

I'll try to post a daily update, unless I lose interest... Alright, first value:


2014-06-04, 3:08 PM CEST

CI = 54
current main trend: up
price at calculation: $636


(edit) to have some basis to track performance, I'll add the approximate price at the time of the calculation above... median price of the last closed 2h interval, and the direction of the main trend that I track, i.e. the trend of which I try to determine whether it will continue or reverse.

(edit 2) clarification of the above: the main trend I track in calculating the CI value is  currently 'up'. The CI value expresses the likelihood that the dominant trend continues to be up. At 54 right now it basically says: "Unclear situation, but slightly leaning towards (upwards) continuation".

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Yeah, I know. Not exactly enlightening, but that's what I got.