Jack I have seen this statement from you several times and would appreciate it if you could tell me why the advent of the pc would cause the defaults to change.
In 20 years time the name Gerald Appel will still be respected and referenced.. By then Jack will be dead and the name Hershey will live on as a chocolate bar
07-28-07 11:00 AM -------------------------------------------------------------------------------- Quote from jack hershey: *SPM was garbage, for example. This is the informal learner-inventor at work. An MACD 12, 26, 9 is a pre PC default level of indicator. It is humor from beginning to end. [/B] -------------------------------------------------------------------------------- Jack I have seen this statement from you several times and would appreciate it if you could tell me why the advent of the pc would cause the defaults to change. History shows, repeatedly, that inovations do affect culture. War games, for me, have been a long term consideration professionally. In this field it is very important to be able to see the effects of things in a multidisciplinary way. I have always done the same for the financial industry. Over the last 50 years that I have been trading, many things have changed and the changes are largely related to the support sevices of the industry. There are other facets as well. going form 1/8ths to pennies was one of them, for example. Today, one of the best platforms supports about three pages of exchanges (one line per exchange). In the mid fifties, roughly speaking, the public did not trade. In the 60's the highest one day volume came when Kennedy was shot. Look at the NYSE volume that day as see it is nothing compared to a day's volume today. Goldman Saks went computer from the blue book in about 1969. TI came up with a hand held for BS as well. The history of indicators showing up is well known. It was before the PC. Historically speaking, a lot of the big manes in trading started in highschool or college and the first crops came up the line before PC's but they adopted to the computer as mainframes began to roll out. When did the public get involved? Mutal funds and the Federal incentives which replace social security was a big step. The financial industry is based on a sales approach to get control of capital (people's) and the industry was not eager to see people do their own trading. But it happened with the cheap PC and then software capability. Trading is best done by taking advantage of the tools out there and using them for making money. New tools come along all the time. And often they can be adapted for making more money. Some tools do outlive their usefulness as well. I do not hand plot anymore on brownlines. All the indicators had to be retooled to make them work on PC's. The basic rate of making money has changed over time for some market paradigms. Pool extraction, which I do, is one of the changing ones. The indicator designers were pragmatic people and they invented suitable indicators for the markets of the time. When you look at noise it is a fourth degree function and signal as a function is more or less a second degree function. The PC compressed the equations as a function of volume. This meant nothing to the SPM "inventor". To me it means something. The "effect" of the PC results in the market's cycle changing. The cycle got compressed. If you stick with the originator's defaults, then the indicators appear to not work too well compared to before the PC. By adjusting the defaults, you come back into line for signal performance according to the original design. The two most noticable improvements are that the indicator follows the cycle instead of "bridging" or floating on the tops of the cycle peaks. The SPM person didn't get this at all for MACD; his MACD bridges and so there is never any posting of MACD signals that would work. The second improvement is that the original designer's signals function for making money. Today, anyone can do a general replacement for indicators as well. This is a major support provided by the PC. It is called software. Indicators are "in effect" built into software and in many ways. So the PC is affecting the markets in this additional way as the public catches on to doing programming to make mechanical systems. The market is being affected by this as we all see. Again, more money can be made by people who do it correctly. There is one distinction. The platforms which have software building blocks are closely tied to the conventional orthodoxy building blocks. A different set of Legos is required it turns out. There is also another computer effect which is setting in to the picture as well. It is probably best described as the plumbing software programming which is quant based and which deals in the conventional orthodoxy. I hope it continues and grows in sophisitication. One thing about the statistical approach that the plumbing programming is built on is the "fix leaks" part. That is cool and it works as a market tooling. It is screwed for trading. however. The EMH would be functional, if and only if, the plumbing "arbitrage" software of the collective quants worked. Last Friday, and 27 FEB07 and the last two summer weeks makes the point. The current bond charts, by classes, also make the point(the SOP flat line of quality went down the drain recently). There are a lot of accounts being blown out as you can see. The trading mileux of conventional orthodoxy is going through another shift in the financial industry. The place to look, from a researchers point of view, is the market pool trading deviation from the normal Gaussian distribution in terms of measuring trade distribution. As a consequence I go back to the drafting board to trim up the PC effect on the indicator defaults. For example, tuned indicators can be used as pre price gap signal indicators. This is a consequence of the tails of the normal distribution getting greater in height (taller and actually longer too) because of how computerized trading is "not" working to maintain EMH. This is another compression example. We actually see that the SCT @40 actions a day is as observed "undertraded". It is an error to some but to me I actually am not an undertrader. My trigger is simply invoked and off I go. Look at Friday as a day where every bar is traded and the trades each are multi point trades. Also notice that the capacity of the ES market is much higher on average per bar. The conventional orthodoxy, and big money are not getting this nor do they see the opportunity. What appears is happening is that many people are emptying their accounts at an ever faster pace as the opportunity ot make money grows stronger and stronger. It is a tail issue and the people who are giving up accounts capital are doing so simply because they ARE CAUGHT ON THE WRONG SIDE OF THE MARKET AND HAVE NO ONE TO TAKE THEIR TRADES. So now the point is made for indicators. They have to be tuned and they have to be read according to the mathematics that comprises the indicator. The PC is what drives the tuning and the PC displays is where the reading takes place for manual traders. This is the pre gap entry type trading from indicators. Exits are the same ilk at peaking. Those of us that use automation, get executions going to platforms from coded instructions and display observations nowadays look more like control panel lighting for automated manufacturing (We just do extraction from pools). Personally, I do annotations in Echelis's book: TA from A to Z. There is another thread on sliding window requirements for reading tapes style trading. Glance at my post there to see what data sets are used for really making high velocity money.
Here is an advanced beginner level comparison on the ER@. I do not trade the ER2. Take your winnings and compare if you feel like it. It looks like you did three trades if the X's are entries and exits. If they are reversals then you did 5 trades and are still holding at EOD. Tell us what signals you used. Thanks for making the point on the bridging for the 12,26, 9 MACD. anyone can note the action points on the 12, 26, 9 in lieu of what you annotated on the price chart. I just did Advanced Beginner channel traverses after the synch BO. A typical day is up to 15 trades. Beginners would just do the day as an "M" day. Long, Short , Long, Short.
No the X's do not represent trades they are a proprietary indicator called TR4 that forms the basis for the expert advisor on the chart.. something I pretty much ignore by the way.. but it does make them look pretty doesn't it Are you normally this forgetful Jack? You spent enough time in the SPM thread to know my entries are off the MA to anticipate the MACD and avoid the inherent lag Seriously you need to get some of this stuff because you are exhibiting early signs of Alzheimer's http://www.antiaging-systems.com/a2z/piracetam.htm