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The DEMAcrossClose line gives a good trend
description.
It is descending on a bullish trend and ascending on a bearish
trend.
The respective Peaks/Troughs have insignificant lag related to
the actual Close Peaks/Troughs.
When the trend exists, you may have interesting Entry/Exit
signals.
Try the experimental Indicator builder formula
// DEMAcross side effect
<FONT
size=2>k=30;p=20;fk=2/(k+1);fp=2/(p+1);d=(2-fp)*fp-(2-fk)*fk;MAp=MA(C,p);MAk=MA(C,k);MAcrossClose=(p*(k-1)*MA(C,k-1)-k*(p-1)*MA(C,p-1))/(k-p);EMAk=EMA(C,k);EMAp=EMA(C,p);EMAcrossClose=((p+1)*(k-1)*EMAk-(k+1)*(p-1)*EMAp)/(2*(k-p));DEMAk=DEMA(C,k);DEMAp=DEMA(C,p);DEMAcrossClose=((1-fp)*fp*EMAp-(1-fk)*fk*EMAk+(1-fk)*DEMAk-(1-fp)*DEMAp)/d;//
Plot(MAcrossClose,"MAcrossClose",4,1);//
Plot(EMAcrossClose,"EMAcrossClose",5,1);Plot(DEMAcrossClose,"DEMAcrossClose",(DEMAcrossClose>Ref(DEMAcrossClose,-1))*colorRed+(DEMAcrossClose<Ref(DEMAcrossClose,-1))*colorBrightGreen,styleOwnScale|styleThick);Plot(C,"Close",1,64);COND1=Ref(DEMAcrossClose,-1)==HHV(DEMAcrossClose,3);COND2=Ref(DEMAcrossClose,-1)==LLV(DEMAcrossClose,3);PlotShapes(shapeUpArrow*Cond1,5,0,Graph1,-20);PlotShapes(shapeDownArrow*Cond2,4,0,Graph1,-20);GraphXSpace=3;
Similar properties appear for the EMAcrossClose
line.
The DEMAcrossClose peak A was the beginning of a 22-bar
bullish movement for the Nikkei index until point B.
Then, an 24-bar bearish trend followed until point
C.
The lag of DEMAcrossClose in the description of this trend was
0 or 1.
Dimitris Tsokakis
----- Original Message -----
From: <A
href="" title=tsokakis@xxxxxxxxx>Dimitris Tsokakis
To: <A href=""
title=amibroker@xxxxxxxxxxxxxxx>amibroker@xxxxxxxxxxxxxxx
Sent: Saturday, August 09, 2003 9:05 PM
Subject: The prediction of a DEMAcross
is the last part of this prediction series.
DEMA is a useful smoother and DEMA crosses give reliable
signals for various indicators.
We shall decrease the lag of a DEMA cross by 1
bar.
The next bar Close necessary for a DEMAk, DEMAp cross is a bit
complicated
DEMAcrossClose=((1<FONT
size=2>-fp)*fp*EMAp-(1<FONT
size=2>-fk)*fk*EMAk+(1<FONT
size=2>-fk)*DEMAk-(1<FONT face=Verdana
size=2><FONT
face="Times New Roman">-fp)*DEMAp)/d;<FONT
face="Times New Roman">
The basic argument is similar to the MA or EMA crosses.
"The crosses of DEMAcrossClose with the Close
line anticipate the DEMA crosses"
In an Ind. builder window paste the formula
// Anticipating DEMAcrosses, by D. Tsokakis, Aug2003<FONT
face=Verdana size=2>
k=30;p=<FONT
size=2>20;fk=2<FONT
size=2>/(k+1);fp=<FONT
size=2>2/(p+1<FONT
face=Verdana size=2>);<FONT
face="Times New Roman">
d=(2-fp)*fp-(<FONT
size=2>2<FONT
face="Times New Roman">-fk)*fk;
EMAk=EMA<FONT
size=2>(C,k);EMAp=EMA<FONT
face="Times New Roman">(C,p);
DEMAk=DEMA<FONT
size=2>(C,k);DEMAp=DEMA<FONT face=Verdana
size=2>(C,p);<FONT face=Verdana
size=2>
Plot(DEMAk,"DEMAk"<FONT
size=2>,1,<FONT
size=2>1);Plot<FONT
size=2>(DEMAp,"DEMAp",<FONT
size=2>2,1<FONT
face=Verdana size=2>);<FONT
face="Times New Roman">
DEMAcrossClose=((1<FONT
size=2>-fp)*fp*EMAp-(1<FONT
size=2>-fk)*fk*EMAk+(1<FONT
size=2>-fk)*DEMAk-(1<FONT face=Verdana
size=2>-fp)*DEMAp)/d;<FONT
face=Verdana size=2>
Plot(DEMAcrossClose,<FONT
size=2>"DEMAcrossClose",4<FONT
size=2>,1<FONT
face="Times New Roman">);<FONT
face="Times New Roman">
PlotShapes(shapeUpArrow*<FONT
size=2>Cross<FONT
face="Times New Roman">(DEMAp,DEMAk),colorBrightGreen);<FONT
face=Verdana size=2>
PlotShapes(shapeDownArrow*<FONT
size=2>Cross<FONT
face="Times New Roman">(DEMAk,DEMAp),colorRed);<FONT face=Verdana
size=2>
PlotShapes(shapeDownTriangle*<FONT
size=2>Cross(DEMAcrossClose,C),colorPink,<FONT
size=2>0,Graph0,-30<FONT
face=Verdana size=2>);<FONT
face=Verdana size=2>
PlotShapes(shapeUpTriangle*<FONT
size=2>Cross(C,DEMAcrossClose),colorPaleGreen,<FONT
size=2>0,Graph0,-30<FONT
face=Verdana size=2>);<FONT
face=Verdana size=2>
Plot(C,"C"<FONT
size=2>,colorDarkBlue,64<FONT face=Verdana
size=2>);
GraphXSpace=4<FONT face=Verdana
size=2>;
The graph of this
DEMAcrossClose [the red line] moves around the actual Close graph and may take
very high [low]
values. It is obvious that there are extended periods for which the
DEMAcross is impossible. [This property will help
the crossover trader to avoid crucial mistakes]
The actual
DEMAcrosses are pointed by the green-red arrows.
The predictions are
pointed by the respective triangles and, usually, anticipate the actual
crosses.
You may replace the Close array with an Indicator and anticipate the
indicators DEMAcrosses.
Dimitris
Tsokakis
PS: In the attached
gif you may see an interesting side effect.
The peaks/troughs of
the red DEMAcrossClose line T1, P1, match with increased accuracy to
the turning points of the stock.
But, this is the
beginning of the next subject and I hope you agree...
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Attachment:
dema1.gif
Attachment:
Description: "Description: GIF image"
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