Trading Catechism

Discussion in 'Trading' started by nitro, Oct 19, 2015.

  1. runtrader

    runtrader

    Looks like the regime shifts are the peaks to troughs, i.e. your distribution encompasses many subtle (Gaussian) distributions each of which could be thought of as it's own regime. Trading would be done within the regime i.e. bouncing off the S/R levels. Once a S/R level is broken it could be thought of moving to a new regime.
     
    #121     Nov 17, 2015
  2. nitro

    nitro

    Exactly
     
    #122     Nov 17, 2015
  3. nitro

    nitro

    The variance-covariance matrix of shocks in a given regime is worthy of study.
     
    #123     Nov 17, 2015
  4. nitro

    nitro

    By far the most important paper I have ever read on the markets is this. I bought the book and actually understood everything before I even read any of it by just reading the table of contents:

    http://bactra.org/reviews/physics-of-finance/

    The one thing he is missing is the Lie Algebra gives the dynamics of the interaction terms or relations between the gauge fields. Although, he uses "The least action principle" which by Noether's theorem can be restated in Lie Algebra language.

    Chartists take heart by this quote:

    "...It even explains why pieces of technical analysis that look little better than voodoo can work over short time horizons, while the long run looks comfortingly close to the efficient market hypothesis..."
     
    Last edited: Nov 17, 2015
    #124     Nov 17, 2015
  5. You lost me at "catechism"
     
    #125     Nov 17, 2015
  6. panzerman

    panzerman

    Try a Power transform (ie Box-Cox transform), or a Fisher transform on the data to make it more Gaussian.
     
    #126     Nov 17, 2015
  7. nitro

    nitro

    That data is already in Cox-Box form. Then it is input to a Histogram.
     
    #127     Nov 17, 2015
  8. nitro

    nitro

    Shocks:

    United States
    =========
    • Change in Non-Farm Payrolls
    • Unemployment Rate
    • Trade Balance
    • GDP, QoQ % ann.
    • Retail Sales ex-Autos, MoM %
    • ISM Non-manufacturing
    • CB Consumer Confidence
    • ISM Manufacturing
    • TICS Net Portfolio Flows
    • Chicago PMI
    • Durable Goods Orders, MoM %
    • New Home Sales
    • Core CPI, MoM %
    • Empire Manufacturing PMI
    • Industrial Production, MoM %
    • Philadelphia Fed Business Conditions
    • UoM Consumer Con...dence
    • Housing Starts
    • Initial Jobless Claims
    Euro Area
    ======
    • German IFO Survey
    • German ZEW Survey
    • German GDP, QoQ %
    • Euro-Zone Core CPI, YoY %
    • German Factory Orders, MoM %
    • German Industrial Production, MoM %
    • Italy Business Confidence
    • Euro-Zone Economic Confidence Index
    • Euro-Zone M3, YoY %
    • France Consumer Spending, MoM %
    • German Retail Sales, YoY %
    • Euro-Zone Consumer Confidence Index
    • France INSEE Business Confidence
    • Euro-Zone Industrial Confidence Index
     
    #128     Nov 17, 2015
  9. nitro

    nitro

    Notice how accurate your database has to be. You need a news source "table" where all the news is automatically entered so that later when doing regime analysis on high frequency data reaction to shocks, you can begin to get a quantitative analysis of events.

    There are people just dedicated to databasing feeds at institutions. I am nearly done with mine.
     
    #129     Nov 17, 2015
  10. nitro

    nitro

    cat·e·chism
    ˈkadəˌkizəm/
    noun
    noun: catechism; plural noun: catechisms
    1. a summary of the principles of Christian religion in the form of questions and answers, used for the instruction of Christians.
      • a series of fixed questions, answers, or precepts used for instruction in other situations.

    https://www.google.com/search?client=ubuntu&channel=fs&q=Catechism&ie=utf-8&oe=utf-8
     
    #130     Nov 17, 2015