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Hi Peter (a.k.a server not recognized) and Bill
(a.k.a wavemechanic)
I just watch your discussion and wonder if you
could (and willing to) write something
for the newsletter. I mean to put your time and
energy into writing
something that all AmiBroker users can benefit
from.
Maybe an AFL formula that showshow to
apply your trading experience
in AmiBroker environment?
What do you think?
Best regards,Tomasz Janeczko===============AmiBroker - the
comprehensive share manager.<A
href="">http://www.amibroker.com
<BLOCKQUOTE
>
----- Original Message -----
<DIV
>From:
wavemechanic
To: <A title=amibroker@xxxxxxxxxxxxx
href="">amibroker@xxxxxxxxxxxxxxx
Sent: Friday, May 25, 2001 3:49
PM
Subject: Re: [amibroker] Vertical
Lines
Ok Server, you sucked me, but not to respond to your
unsubstantiated claims about Gann that you continue to try to wiggle out
of.
<BLOCKQUOTE
>
----- Original Message -----
<DIV
>From:
<A title=winchp@xxxx
href="">server not recognized
To: <A title=amibroker@xxxxxxxxxxxx
href="">amibroker@xxxxxxxxxxxxxxx
Sent: Friday, May 25, 2001 9:06
AM
Subject: Re: [amibroker] Vertical
Lines
If its all the same to you I'll have the last word.
You've obviously decided and your mind is madeup and
Gann is for you. Fine. So don't pretend all I have to do is show a
table of result comparisons. We both know that even if I were inclined
I'd have to run every indicator known to man in every conceiveable scenario
with Gann finishing last to convince you. Its disengenious of youto
suggest all I'd have to do in one apparently innoccous sentence.
If I showed only one occassion where anything was better than Gann it
wouldn't mean anything. To develop the statitiscs to demonstrate that
Gann's inferiority was statistically significant we both know is a
mountain of work.
OTOH as you mention candlesticks, Japanese candlesticks
HAVE been assessed and the markets HAVE changed and the classical reponses
HAVE changed. It doesn't invalidate candlesticks, just changes how you
have to work with them. This is a lot easier to prove. Amibroker can
show it now if any care to look. In fact fading the classic indicators is
more likely just as the MACD(26,12) artifact is used by professional traders
to screw the little guys who never change the defaults in
Metastock.
The square property you try and ascribe to normal
distribution of prices is incorrect, prices are probably log normal.
They also have long memory (hurst et al). So its at best an
approximation - which is OK so long as its borne in mind while using
it.
The Black-Scholes model of
option pricing is based on a normal (random walk) distribution of price
movements. Random walk (Brownian motion) models result
in an expected price excursion that varies with the square root of
time. Over time, stock price movement have been shown to randomly
distributed, so the fact that the square root factor pops up in both theory
and practice is not surprising. So to directly address your comment,
prices are probably not log normal distributed. I have not read the
MIT studies for sometime, but I believe that was their conclusion
also.
To completely ignore that since 1950 a HUGE amount of time
(read $) has been spent on time series analysis, and just about anything
else that walks, to make trading systems that work. Normal folk manage
by rotating through indicators/oscillators and time constants slowly with
time as tried and true lose their effectiveness. Most have a select
group for primary work and maintain a stable of those in waiting that could
work or show promise, rather than seek a Holy Grail indicator. Since
Gann died what developments have there been? Connie
notwithstanding. Mocking my comments about age is not arguement.
You are suggesting that in 2050 Gann as-is will be used, 2150 etc. The
fact Connie spent a whole chapter trying to condense the ramblings of Gann,
and she's spent a career on it, from which you pick two simple ideas, should
be warning enough that traders shouldn't waste time with Gann looking for
the hidden secret. A secret powerful enough to need to be coded and
hidden away. The secret isn't there. You've probably extracted
about as much as is worth using - a technique and MM.
Enough for now. I hope this discussion has provoked
some thought from others at least. While not about Amibroker, it is
about trading, and some of the power of Amibroker can be used to check some
of the flakier ideas out fast without wasting time.
In the meantime I'm sure if something you deign is earth
moving happens, worth discussing and of great importance you'll
tell us.
P
<BLOCKQUOTE
>
----- Original Message -----
<DIV
>From:
<A title=wd78@xxxx
href="">wavemechanic
To: <A
title=amibroker@xxxxxxxxxxxxxxx
href="">amibroker@xxxxxxxxxxxxxxx
Sent: Friday, May 25, 2001 11:44
AM
Subject: Re: [amibroker] Vertical
Lines
<BLOCKQUOTE
>
From: <A
title=winchp@xxxx
href="">server not recognized
<BLOCKQUOTE
>
<BLOCKQUOTE
>
To: <A
title=amibroker@xxxxxxxxxxxxxxx
href="">amibroker@xxxxxxxx
Sent: Thursday, May 24, 2001
7:49 AM
Subject: Re: [amibroker]
Vertical Lines
This is not the place to go into these
things. As a generality any horse can make it around the
track. Some are better than others. The fact that almost
any method scrutinised to an inch of its life coupled with money
management speaks volumes for money management. By money
management I mean simply GET OUT when it doesn't go you way
from the start. I'm my own worst adherent of this one.
Why is it so important to be able to get a time and pricefrom
a single high or low? Would anybody seriously invest 5% of
their wealth on a single data point? So what's the
point?
As you note below, mutiple
inputs are important, although you incorrectly assume that I use
only Gann. Gann stuff is one approach that I use.
Fibonacci is another, Momentum is another. Etc. So
for me Gann is just one of many tools, and like Fibonacci is used as
a heads up indicator. I do not invest on the basis of any
single indicator. And yes, money management is important,but
I like to start with the best indicator base that I can
find.
WE
AGREE.
I've had a go at Gann and the problem is for
me that its not IMNSHO even as useful as my favourite P&F.
Not only does it not have timing but it doesn't give any sense of
"storing of energy". I've thought that a 3D square where time
spent at a price accumulated vertically might be useful. But
my biggest problem is that it doesn't seem grounded in anything
substantial. Even Fibbonacci seems to be reflected or
grounded in some natural mathematical order. At best if Gann
provides a set of definite rules that are adhered to maybe that's
its strength or best point.
You clearly do not fully
understand Gann when you say it does not have timing. Please
refer back to the Gold chart. But your biggest problem is
mixing up correlation with cause. There is nothing you orI
use that has a known cause. Correlation? Yes, but not
cause. As one learns in Logic 101, establishing a cause
requires a theory that accounts for observations better than
alternative theories. As a result, everything we do is inthe
"voodoo" category since there are no valid theories (not
correlations) for MACD, RSI, Gann, Fibonacci,
etc.
WHO MENTIONED CAUSE?
I presume that "grounded in
anything substantial" is a cause, certainly not a
correlation.
I've read almost "Truth of the Stock Tape" &
"Wall Street Stock Selector" by Gann. My conclusion was that
the markets in his day were different and he applied a great deal of
unknown but appreciable sub-conscious pattern recognition and
judgement to his work - at least I think so. Interpretation
still has plenty of scope. Gold may well have fit within $0.50
but I'm also sure that someone's RSI, or MACD or whatever had
settings that hit it too.
I have read very
few of the original works of any indicator/system developer,
including Gann, and just sponge off of the digested output of the TA
writers, as most do. But you are exactly right about the value
of other methodologies. That is why no tool should be used
alone, including RSI, MACD, Gann, Fibonacci, etc. Very few use
only one thing, but look for verification from many. In my
experience, Gann is one that is useful in this regard, and so
far all you have said that is that you do not believe. I
have shown you evidence that it does work. Always? No,
but nothing does. I have not seen anything presentedby
you that indicates that Gann has a poorer win/lose ratio than
any other indicator. Do you have such
evidence?
I CAN SENSE THAT NOTHING
SHORT OF A TREATISE WILL WORK FOR YOU. THEN I FACE THE
CHALLENGE PROCESS. AND THEN OF COURSE ITS STILL ONLY A THEORY SINCE
THERE IS NO PROOF.
Since you have knocked Gann
so hard, I have no doubt that you have statistically valid datato
justify such a position. Please share that so that we canall
benefit. I certainly do not expect a treatise. How about
graphical or tabular results demonstrating the futility of using the
Square of 9 or Gannsect versus other methodologies? If this
cannot be done, then there is no objective basis for rejecting
these approaches.
I spent a bit of time in misc.invest.technical and
misc.invest.futures newsgroups and of those whose opinions and
experience I came to believe was based on solid years of experience,
they didn't have much kind to say about Gann compared to other
approaches. I suggest a vist to <A
href="">www.deja.com and and see Hershey for
example.
Most, like yourself, do not
really understand how to properly use Gann. As a result, their
opinions are not particularly important. Like you
I used to spend time on the "misc" boards, but did not
find them worth the effort of shifting through the
"junk." There are much better
places.
THIS TRUE ESPECIALLY LATELY
OVER THE LAST 6-8 NTHS ESPECIALLY. HOWEVER SEVERAL YEARS AGO
THE GROUPS I MENTIONED WERE ESPECIALLY ACTIVE AND ABOUT 10-15
POSTERS WERE EXTREMELY EXPERIENCED IN TIME, MARKETS AND
TECHNIQUES. THESE ARE PEOPLE WHO KNOW ABOUT ARCH AND GARCH AND
EVEN MORE ADVANCED TIME SERIES ANALYSIS TECHNIQUES. SOME
DEVELOPED TRADING SYSTEMS FOR MEGA MILLION FUNDS. AS A RETORICAL
SUGGESTION - WOULD YOU BE HAPPY WITH YOUR SUPERANNUATION FUND USING
GANN TECHNIQUES?
<FONT
color=#008080>What do you mean by Gann techniques? I use only
two - Gann Square of 9 and Gannsect. Yes I would be happy
using them with my IRA, as well as with any of my trading. In
fact, I do. I do not use different methodologies for different
types of accounts. Why would I? The trading vehicles
differ, but not the methodologies. <FONT
color=#008080>I suppose that one could envision using different
techniques for short- and long-term trading, but that would reflect
use of systems that are specifically aimed at certain time frames,
which mine are not.
I suggest that multiple tools operating in
different time frames, an awareness of the inherent lags or
anticipatory nature of the tool/indicator/oscillator/chicken
entrails coupled with MM will do the trick more than
GANN.
Well as noted above, we
agree about multiple tools and time frames. But MM? You
obviously are not aware that MM is based on Gann's Square of
9. Time for a little homework. Once again, please
provide evidence for your statements about the value of one
methodology over another. You speak with such certainty that I
am sure you must have a valid statistical basis for your
statements. Please share them with us, or by direct
e-mail, if you do not want to post. Absent this enuf
ced.
OK. READ P. KAUFMANN
PP366 -371 FOR A DESCRIPTION. NOTHING STARTLING OR DEROGATORY ABOUT
WHAT HE SAYS. THE LAST FEW SENTENCES ARE 'ON MANY OF GANNS
CHARTS THERE IS NOTATION SHOWING PLANETARY MOVEMENT...'.
KAUFMANNS NEXT TOPIC IS FINANCIAL ASTROLOGY. I'M NOT USING
GUILT BY ASSOCIATION, BUT REFERING ABOVE WOULD YOU BE HAPPY IF YOUR
SUPERANNUATION FUNDS INVESTMENT DECISIONS WERE RULED BY ELEMENTS OF
ASTROLOGY. IF THEY MADE MONEY NO-ONE WOULD COMPLAIN BUT CAN
YOU IMAGINE THE OUTCRY IF THEY LOST MONEY AND FINANCIAL ASTROLOGY
WAS INCLUDED. AGAIN NOT PROOF OF ANYTHING. IF THE
FEATURE OF GANN IS DESCRIBED AS AN ATTEMPT TO GET CYCLICAL BEHAVIOUR
AND AS KAUFMANN DESCRIBES GANN'S APPROACH AS"CONSERVE YOUR CAPITAL
AND WAIT FOR THE RIGHT TIME' I STAND BY MY ASSERTION THAN 'GANN' IS
MORE ABOUT MM THAN HIS TECHNIQUE. IF YOU WATCH A RACEHORSE AND
NO OTHER RACEHORSE THEN EVENTUALLY YOU'LL SEE IT IN A RACE THATIT
CAN RUN A PLACE AND YOU'LL PUT A BET ON AT THAT TIME.
Gann, as
you note, believed in astrology. But the point you miss
is that his Square of 9 has nothing to do with astrology. The
fact that he made such astrological notations on his charts has
nothing to do with the mathematical validity of
squaring price and time, or whether or not he believed that
there was an astrological basis for the charts. One does not
have to know the slightest bit about astrology, and I don't, in
order to use the techniques. The Square of 9 chart is nothing
but a square root table, which by the way, if you are concerned
about cause, one can argue is assocated with prices that are
normally distributed and that should be related by a square
relationship. To understand that astrology is not involved you
will have to understand the construction of the Square of
9. As far as your rejectioin of the Square of 9
(and Gannsect) is concerned you are offbase when you reject
them on astrological grounds. And to be sure, Gann undoubtedly
used money management, as any trader does with any system.
However, going back to correlation and cause, I personally haveno
problem using astrological stuff if a valid correlation can be
demonstrated. Actually, I have seen one on another board
posted by a respected trader that does give me pause whenever there
is a new and full moon.
MURPHY SAYS'GANN LINES
(REFERRING TO FAN LINES)ARE SOMEWHAT CONTROVERSIAL. EVEN IF ONEOF
THEM WORKS YOU CAN'T BE SURE IN ADVANCE WHICH ONE IT WILL BE. SOME
CHARTISTS QUESTION THE VALIDITY OF DRAWING GEOMETRIC TRENDLINESAT
ALL.' AND THAT IS ALL HE HAS TO SAY ABOUT GANN IN 500 PAGES.
DRAW YOUR OWN CONCLUSIONS.
No conclusion to be
drawn. As with Fibonacci fan lines, etc. they sometimes work
and sometimes they don't. I personally do not use them, but as
you know many traders use them all the time, presumably
successfully. My conclusion about the trendline statementis
that based on the experience of the vast majority of traders itis
nonsense.
SCHWAGER DOESN'T EVEN
MENTION GANN IN 700 PAGES. READ ELDER 'TRADING FOR A LIVING"
P23. REGARDING GANNS ALLEDGED $50M...WHY ALL THE SECRET CODES,
O/SEAS BANK ACCOUNTS, KEEPING MONEY FROM FAMILY ETC...YOU'D BELIEVE
A LAWYER? THAT SORT OF BEHAVIOUR SMACKS OF PARANOIA OR AND
GURUISM. IT SEEMS TO ME TO REFLECT ON THOSE SELLING
SYSTEMS AFTER HIS DEATH TO MAINTAIN GANN AS A SEMI MYSTIC SO THEY
CAN SELL A SYSTEM THAT THEY HAVE TO EXPLAIN BECAUSE IT WAS ALL
WRITTEN IN CODE.
'THE COMPLETE CRAP'COMMENT
RELATES TO USING AN APPROACH THAT IS 60 YEARS OLD, THAT CONTAINS
SOME ELEMENTS RECOGNISED AS IMPORTANT SUCH AS MM & BEHAVIOUR AND
WERE AHEAD OF HIS TIME. BUT SO WAS HENRY FORD AND LOOK WHAT
OTHERS HAVE DONE TO THE CONCEPTS SINCE.
Please try to move beyond
amateur psychology to providing solid evidence that Gann's Square of
9 (or Gannsect) does not work. Absent your willingness or
ability to do so, you appear to be "beating the air" in an
attempt to muddy the waters and hide the fact that your
opinions are unsubstantiated. Basic Gann (Square of 9 and
Gannsect) is very simple and available in "decoded" form for any who
want to learn the techniques. These techniques, I should
mention, are "decoded," as I understand because some took the time
to figure out what Gann was doing. I agree that the weakness
in using Gann is that it is 60 years old and has not changed since
then. That is a valid point, and as a result I will throw
out my Japanese candlestick books based on an essentially unchanged
approach that is 350 years old. If I live long enough, I guess
MACD, RSI, etc., etc., will be old enough to be dumped.
Probably should also throw out all the stuff about Newton, calculus,
chemistry, etc. Gads, even I have to go! You are
right, old is "crap." LOL.
But the beauty is....its your money...anyone can
play ....nobody is right absolutely...
I STAND BY THIS ANDWISH YOU
THE BEST. I'M NOT TRYING TO DISSUADE YOU BUT PUT A POINT OF
VIEW. I SUSPECT THAT USUALLY WHEN PEOPLE FOLLOW PERSONALISED
SYSTEMS (MEANING BASED ON PERSONALITIES) THEIR ADOPTION BEGINS
TO BORDER ON A RELIGIOUS BELIEF AND A REBEL ATTITUDE THAT SEEKSTO
BE CONTRARIAN FOR THE SAKE OF IT. THIS COMMENT IS NOT DIRECTED
AT YOU SINCE I DON'T KNOW YOU. GOOD LUCK WITH GANN BUT I WISH
TOMASZ DIDN'T PUT IT IN AMIBROKER BECAUSE IT PERPETUATES A MYTHAND
CONTINUES TO LEND CREDIBILITY TO SOMETHING THAT SHOULD HAVE
BEEN INSTALLED IN THE HALL OF FAME YEARS AGO, AND THE REST OF US
HAVE MOVED ON. JUST MY OPINION OF COURSE. YOU COULD ALSO SEE
GARY SMITHS COMMENTS "HOW I TRADE FOR A LIVING" ON P31 &
61. YOU MIGHT BE MORE ALIGNED WITH HIS SUGGESTION OF
PERCEPTUAL FILTERS. THIS IS A VIEW A LONG WAY FROM USING GANN
TO TRADE WITH.
You might try knocking Gann
with successful traders that keep Gann in their toolbox.
For starters, I suggest you contact Connie Brown and/or Bryce
Gilmore and bounce your view of Gann off them. I think you
would agree that they qualify as successful traders, and Iam
sure that they would confirm (as they do in their books and on
their websites) use of Gann in conjunction with other stuff.
Whether you contact these traders or others, be prepared
for your unsubstantiated viewpoint to be rejected without
much fanfare. I know that my rejecting your viewpoint is
of little consequence, but I would hope that rejection by
acknowledged traders would give you pause. As for AmiBroker,
it is stronger because it incorporates some of these tools, andI
have suggested to Tomasz that more be done along these lines.
Hopefully that will come to pass.
Finally,
I do not intend to comment further on this issue unless there is
something of great importance to be said. At this point,
we are going in circles, using up a lot of space, and
devoting too much valuable time to this issue. You or
anyone else are free to contact me offline at <A
href="">wd78@xxxx, if there is
something short of earthmoving importance to
discuss.
<FONT color=#800080
size=2><FONT color=#800080
size=2>
<FONT color=#800080
size=2>Cheers.
<FONT color=#0000ff
size=2> Your
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href="">Yahoo! Terms of Service.
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