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Ken,
You cannot change the .01 value. The .01 is simply a multiplier to
convert the "Amount" parameter from its whole value to its fractional
percentage value (e.g. from 15 to .15).
The parameter is expressed as a whole for convenience, but must be
converted to a fraction when performing calculations. PU and PD are
the target prices and are simply the current peak/trough minus/plus
an additional "Amount" percent of the current peak/trough. To
calculate the "Amount" percent, he multiplies Amount by .01.
Mike
--- In amibroker@xxxxxxxxxxxxxxx, Ken Close <ken45140@xxx> wrote:
>
> Thanks TJ, David, Graham:
>
> Now, if you care to explain something else about the Trader's Tip
code for
> "The ZigZag Trend Indicator"
>
> These are the two important lines which help determine that the Zig
has
> moved a "confirming amount" in the new trend direction, and thus
you can
> switch to the "other side" of the ZigZag movement.
>
> PU = tr + 0.01 * abs(tr)*amount;
>
> PD = pk - 0.01 * abs(pk)*amount;
>
> Now, take the "factor" 0.01 and make it smaller. This has the
effect of
> moving the buy/sell arrows closer to the peak. The CAR of
this "adjusted"
> system will be higher than if you leave the original 0.01 factor in
place.
> Is it then "looking into the future"??
>
>
>
> _____
>
> From: amibroker@xxxxxxxxxxxxxxx [mailto:amibroker@xxxxxxxxxxxxxxx]
On Behalf
> Of Tomasz Janeczko
> Sent: Thursday, October 30, 2008 6:25 PM
> To: amibroker@xxxxxxxxxxxxxxx
> Subject: Re: [amibroker] The Theory of Zig and How to make it Work
>
>
> Hello,
>
> Look here for example of how zig-zag is coded:
> http://www.amibroker.com/library/detail.php?id=472
>
> The meaning that it looks into the future is that
> zig-zag requires certain number of bars (depending on threshold
specified)
> to find out the direction, once the threshold is reached it changes
> PAST values. So in real-time trading you would not get those
> signals that zig-zag generates until the price movement since last
> peak/trough is bigger than threshold.
> This is "after the fact" diagnosis, similar to what humans do when
they
> speak "if I bought one year ago I would be rich because I now see
the
> trend".
>
> Actually Zig-zag can be used for trading if only trading signals
generated
> by it
> are DELAYED as much as it is necessary to confirm the movement in
given
> direction.
> Exact code how to do this is given in Traders' Tips:
> http://www.amibroker.com/members/traders/11-2003.html
>
> Best regards,
> Tomasz Janeczko
> amibroker.com
>
> ----- Original Message -----
> From: Ken Close <mailto:ken45140@...>
> To: amibroker@xxxxxxxxxxxxxxx
> Sent: Thursday, October 30, 2008 10:25 PM
> Subject: [amibroker] The Theory of Zig and How to make it Work
>
> A friend asked me why he can not trade with the Zig indicator.
> I answered: "Because it looks into the future."
> He said, "What does that really mean?"
> I said: "It looks into the future."
> He said, "Huh".
>
> Can someone explain, without using the words "It looks into the
future", why
> the Zig indicator can not work.
> How is it coded internally? What makes it work--plot that is?"
>
> I found some code on my hard drive from 2004 called "Zig Zag Safe
to Use".
> I will copy the code below.
> Why does this code say that it is "Safe to Use"?
> What do you look at, what does the several adjustment values do,
that makes
> it safe?
>
> Any explanations in english, that are easy to understand?
> Will this code be safe to trade?
>
> Thanks,
> Ken
> ============================================================
>
> array = Close;
> amount = Param("Amount", 5, 1, 50, 0.5 );
>
> adjust = Param("adjust",0.001,0.001,0.10,0.001);
>
> zz0 = Zig( array, amount );
> zz1 = Ref( zz0, -1 );
> zz2 = Ref( zz0, -2 );
> tr = ValueWhen(zz0 > zz1 AND zz1 < zz2, zz1);
> pk = ValueWhen(zz0 < zz1 AND zz1 > zz2, zz1);
> PU = tr + 0.01 * abs(tr)*amount;
> PD = pk - 0.01 * abs(pk)*amount;
> ZZT = IIf( array >= PU AND zz0 > zz1, 1,
>
> IIf( array <= PD AND zz0 < zz1, -1, 0 ) );
> ZZT = ValueWhen( ZZT != 0, ZZT );
>
> // plot price bar chart
>
> Plot( Close, "Price", 1, styleLine );
>
> // plot Zigzag and zigzag trend
>
> Plot( ZZT, "ZigZagTrend", colorRed, styleOwnScale );
>
> Plot( zz0, "ZigZag line", colorBlue, styleThick );
>
> // Plot the ribbon
>
> ribboncol= IIf( ZZT > 0, colorGreen, colorRed );
>
> Plot( 2, "ZZT Ribbon", ribboncol, styleArea | styleOwnScale |
styleNoLabel,
> 0, 100 );
>
> GraphXSpace = 10;
>
> Buy = Cover = Cross( ZZT, 0 );
>
> Sell = Short = Cross( 0, ZZT );
>
> // plot arrows
>
> PlotShapes( Buy + 2 * Sell, ribboncol, 0, IIf( Buy, L, H ), -30 );
>
------------------------------------
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