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Xuanling & other Metastock friends,
Jose's Metastocktools site is great, it gave me lots of inspiration, and I agree with Jose that the gradient depends on the X-axis timescale, "averaging interval", or "smoothing period" that is used. However, as a trader, investor and project manager, I have some slightly different ideas regarding objective measurements for gradient plots. Personally, I use the Annualized ROI% (annualized percentage Return on Investment) concept, in which the percentage price change is converted to a common objective measure that can then be used for validly comparing all stocks, indices, futures, FX trades, project returns, etc.
"Annualized" ROI does NOT mean that you have to take the averaging period as a whole year, but rather that, whatever averaging period you take, the result is then converted to what would be the return that you would get, if the price kept changing at that same rate for a whole year.
Try this:
MyPrice: = C; {or use EMA, or zero-phased EMA, or whatever else you prefer}
BarsPerYear: = 250; {use 250 here if daily, or use 52 if weekly data}
Lag: = Nbars; {...use whatever you want here for your averaging interval.
Can be equal to a year, in which case use 250 for daily or 52 for weekly data,
OR it can be as short as 1 (bar) , if you want to take "instantaneous" slope}.
AnnualizedROIgradient:= 100 * (MyPrice/Ref(MyPrice,-Lag) -1) * BarsPerYear / Lag
This allows you to select whatever Lag (smoothing) interval you want, although the obvious candidates for stocks are:
1 day (Nbars = 1 bar on daily charts. This is very noisy, but good to show extreme values),
1 week (Nbars = 5 bars on daily charts, or 1 bar on weekly charts),
1 month (Nbars = 21 or 4 respectively)
1 quarter (Nbars = 63 or 13 respectively)
1 year (Nbars = 250 or 52 respectively)
As Jose says, of course the results will differ depending on the timescale you look at, but that's true for most other indicators, and what you use really depends on the timescale that you are concerned about. The advantage of the annualized ROI concept for gradient is that, once you decide on the interval that you need to use, which should be consistent with your trading or investment timeframe, you then have an EQUAL basis of comparison for ALL your potential trades, investments, etc, and even the interest (if any) that is paid on your bank account. :-)
Cheers,
from Tony
(Still in Moscow, probably moving to Mumbai later this year)
====================
----- Original Message ----
From: Jose Silva <josesilva22@xxxxxxxxx>
To: equismetastock@xxxxxxxxxxxxxxx
Sent: Saturday, April 7, 2007 2:46:31 PM
Subject: [EquisMetaStock Group] Re: Find gradient of MA
Xuanling, the gradient of any plot is always subjective - it depends on
the x-axis' (time/date) settings. Apart from 0 degrees (flat), it is not
possible to measure any plot gradient objectively.
Take a look at these indicators below from
http://www.metastoc ktools.com/ #metastock :
EMA-slope - EMA synthetic slope indicator.
LinReg formulae - Linear Regression Indicator/Slope formulae.
LinReg Slope - Linear Regression synthetic slope, displays output in
0~100% or 0~90 degrees.
jose '-)
http://www.metastoc ktools.com
--- In equismetastock@ yahoogroups. com, "CXL2" <cxl2@xxx> wrote:
>
> Hi,
> I will like to compute the gradient of Moving Average (or data array)
> for a given period. Based on the gradient, I can know whether the
> moving average is how steep or flat it is and its direction within a
> given period. Is there anyway of doing so?
>
> Thanks alot!
>
> Xuanling
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