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...versus complicacy.
As you know, Stochd() moves between [0,100].
Whithout sophisticated mathematics, the quantity
q=abs { [Stochd()-50]/50 }belongs to [0, 1]
and has a close "phase" relation with stock
price.
It is almost 1 in "hot" areas of 0 (where stochd()
is
oversold) and 100 (where stochd() is overbought)
and it is 0 in the trading area of 50.
This is what you need for Adaptive Moving
Average.
To be fast when you buy or sell and to be slow in
the
medium range, where the undesirable whipsaws
occur.
Try the following, first approach, application.
/*Stochastic Adaptive Moving
Average*/
s1=StochD<FONT
size=2>(14<FONT
color=#800000>);
f=abs<FONT
size=2>((s1-50)/<FONT
size=2>50);<FONT
color=#800000>
m1=AMA<FONT
size=2>((H+L)/2<FONT
size=2>,0.9*f);<FONT
size=2>
m2=AMA<FONT
size=2>(m1,0.2<FONT
color=#800000>*f);
Graph0=m1;<FONT
color=#800000>
Graph2=C;Graph2Style=<FONT
size=2>64;
Graph1=m2;
Improvements and comparison to other AMA attempts
will follow, if you want it.
Dimitris Tsokakis
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