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MC,
Thanks!
You're right there is no magic.
My son and I were working on the analytical form ourselves.
Eventually what I'd like to see is a version that would allow inputs
of both the short term moving average lookback periods and the
recursive lookback periods and while I know a solution will finally
surface as it always does this certainly helps move us forward in
the quest.
Preston
--- In equismetastock@xxxxxxxxxxxxxxx, "p_panther_73" <mchantzi@xxx>
wrote:
>
> Just in case someone finds it interesting, the expression
>
> (Mov(C,2,S)+
> Mov(Mov(C,2,S),2,S)+
> Mov(Mov(Mov(C,2,S),2,S),2,S)+
> Mov(Mov(Mov(Mov(C,2,S),2,S),2,S),2,S)+
> Mov(Mov(Mov(Mov(Mov(C,2,S),2,S),2,S),2,S),2,S)+
> Mov(Mov(Mov(Mov(Mov(Mov(C,2,S),2,S),2,S),2,S),2,S),2,S)+
> Mov(Mov(Mov(Mov(Mov(Mov(Mov(C,2,S),2,S),2,S),2,S),2,S),2,S),2,S)+
> Mov(Mov(Mov(Mov(Mov(Mov(Mov(Mov
(C,2,S),2,S),2,S),2,S),2,S),2,S),2,S),2,S)+
> Mov(Mov(Mov(Mov(Mov(Mov(Mov(Mov(Mov
(C,2,S),2,S),2,S),2,S),2,S),2,S),2,S),2,S),2,S)+
> Mov(Mov(Mov(Mov(Mov(Mov(Mov(Mov(Mov(Mov
(C,2,S),2,S),2,S),2,S),2,S),2,S),2,S),2,S),2,S),2,S))/10;
>
> can be written down in the following analytical form:
>
> (C*1023+Ref(C,-1)*2036+Ref(C,-2)*1981+
> Ref(C,-3)*1816+Ref(C,-4)*1486+Ref(C,-5)*1024+
> Ref(C,-6)*562+Ref(C,-7)*232+Ref(C,-8)*67+
> Ref(C,-9)*12+Ref(C,-10))/10240
>
> I don't know about you (though I can bet that most of you would
tend
> to agree), but to me it seems like there's no magic to it :)
>
> I have a relative post at my blog http://mc73.wordpress.com
>
> It's in my native language, so probably you won't find it of much
use.
>
> Regards,
>
> mc
>
> --- In equismetastock@xxxxxxxxxxxxxxx, "Lionel Issen" <lissen@>
wrote:
> >
> > Superfragalist:
> >
> >
> >
> > You are dead RIGHT and thanks for this thoughtful posting.
> >
> >
> >
> > Lionel
> >
> >
> >
> > From: equismetastock@xxxxxxxxxxxxxxx
> [mailto:equismetastock@xxxxxxxxxxxxxxx]
> > On Behalf Of superfragalist
> > Sent: Friday, February 20, 2009 10:54 AM
> > To: equismetastock@xxxxxxxxxxxxxxx
> > Subject: [EquisMetaStock Group] RMO sizzle adjusted moving
averages
> & zero
> > lag oscillators
> >
> >
> >
> > The name RMO is all about marketing. In the world of TA nearly
all
> > indicators are sold on the "mystery" and not the performance.
> >
> > It's selling the sizzle rather than the steak. If Equis had said,
> > we're putting in the Rainbow OSC into MS 10, want to upgrade?
Well,
> > you better step back because the stampede is coming!
> >
> > Equis built a whole marketing campaign around the RMO based on
what a
> > great system it is. It's performance is based on the same
fundamental
> > issue. In a definitive trend nearly anything works well. This
premise
> > about definitive trends seems so simple, but many people ignore
it, or
> > worse, assume they get it. The best book that really defines the
> > importance of knowing the trend is How I Trade for a Living by
Gary
> > Smith.
> >
> > Anytime something comes out that's new, the code hacks start the
> > reverse engineering. Often it's simple.
> >
> > It's surprising how much mystery sells. My favorite example is
the CS
> > Scientific expert based on fuzzy logic. There are more questions
on
> > that than any other expert in MS. It's amazing how many people
think
> > it's the most accurate expert in MS. Many people have tried to
track
> > down the developer, the company or anyone that knew them so they
can
> > "buy" the code.
> >
> > When I tell people it's simply a moving average crossover, they
think
> > I'm lying to them, or I don't know what I'm talking about. Moving
> > average crossovers are based on stocastics so they're fundamental
> > fuzzy logic equations. In the ribbon indicator, there's a std dev
> > thrown in so now it's really getting into deeper fuzzy logic.
> >
> > Mystery is wonderful. It just doesn't make anyone but the seller
any
> > money.
> >
> > Super
> >
> > --- In equismetastock@xxxxxxxxxxxxxxx
> > <mailto:equismetastock%40yahoogroups.com> , pumrysh <no_reply@>
wrote:
> > >
> > > GV,
> > >
> > > You are correct, I would like to see an easier version of the
> > > indicator even though I know that a SMA(6) is very close.
While 1%
> > > at this quick/short of a lookback is not much I can't help but
think
> > > that the further out you go the bigger the difference would be.
> > >
> > > I also mentioned that not all programmers lay all their cards
on the
> > > table. I was talking about myself, not Wabbit. To see all of
the
> > > Equis forum discussion go to:
> > >
> > > http://forum.equis.com/forums/thread/23170.aspx
> > >
> > > As far as the RMO versus the Rainbow, I would have to say that
> > > little was ever published about the Rainbow. What we have then
is an
> > > enhanced version of the Rainbow which happens to be called the
RMO
> > > and that's quite okay. Maybe the name should be changed
to "RMO...an
> > > enhanced Rainbow Oscillator System".
> > >
> > > I'm really glad that you have been able to learn something
from the
> > > discussion. If we've stimulated some other minds as well then
its
> > > been a really good day.
> > >
> > >
> > > Preston
> > >
> > >
> > >
> > >
> > > --- In equismetastock@xxxxxxxxxxxxxxx
> > <mailto:equismetastock%40yahoogroups.com> , "Vasanth Mohan G
Buddaan"
> > > <vgbudawn@> wrote:
> > > >
> > > > I take Preston saying "...and would love to see a shorter /
easier
> > > version of it" to be an invitation to take the discussion
further.
> > > >
> > > > Actually wabbit himself in his post has nicely dissected the
> > > recursive averaging to its well approximated simpler version
as
> > > below;
> > > >
> > > > "...it might be interesting to note that the
> > > AverageOfMovingAverages (the mathematical average of the ten 2
bar
> > > SMAs) is ALMOST the same as a much more simple expression, Mov
> > > (C,6,S). If you compare the PRECISE VALUES of the
> > > AverageOfMovingAverages and the Mov(C,6,S) there is always a
small
> > > difference, but, if you compare the instances when the CLOSE
crosses
> > > the AverageOfMovingAverages and the instances when the CLOSE
crosses
> > > the Mov(C,6,S) they are the same, with about 3-4% error. If
you
> > > apply one bar latitude in either direction, the two
expressions are
> > > the same within 1%. Thefore, for testing when the CLOSE
crosses the
> > > AverageOfMovingAverages the trader could easily substitute Mov
> > > (C,6,S) for the more complicated expression."
> > > >
> > > >
> > > > But what I was more interested in RMO was not the formula in
> > > itself which when the indicator itself is available has no
more
> > > additional use but how it, so well, tackled the 'gaps' or the
> > > wildness of a couple of ticks in the direction opposite to the
> > > trend / position. Most usual MACO system would have created a
lag
> > > and if a signal had been generated in that skew it would have
> > > carried on for quite a while but was not so in RMO. When the
whole
> > > Rainbow Indicator formula itself is taken for studying, the
process
> > > does not become obvious but when the simplified version of
wabbit is
> > > considered it makes eminent sense.
> > > >
> > > > What better way than to average the skewedness of a couple
of
> > > ticks with more saner ones prior or past to them to reduce the
> > > impact of this skew. Simple averaging of essentially a short
period
> > > makes sure equal weightage is given to the saner ones
regardles of
> > > their positioning - whether before or after the 'gaps' / the
sudden
> > > spurts thereby reducing the impact of this few stray behaviour
of
> > > the market while still in a larger trend. Then the resultant
output
> > > can always be used for long period averaging to make sure one
sits
> > > through the trend inspite of these few stray & adverse ticks.
In
> > > hindsight, it all looks so very simple & logical. I seriously
wonder
> > > whether the the designer of RMO himself realised it, for if he
had,
> > > he could very well have gone for the long period exponential
> > > averaging of the simple moving averaging like Mov( Mov
(C,6,S) , 81 ,
> > > E ) instead of choosing to average the Rainbow Indicator
thereby
> > > losing some amount of original thinking.
> > > >
> > > > While wild moves of very short term in nature is ignored,
the
> > > adverse effect of this would be a much more severe lag because
of
> > > the initial simple averaging. In other words, this sytem while
> > > avoiding smaller and sharper strayness would either get into
the
> > > trend later but by which time the probability of trend having
set in
> > > would have become high. By same logic, it would also get out
of the
> > > trend later. Or take bigger loses / bigger whipsaws when
prices
> > > trade in larger ranges due to its lack of sensitivity. That
is,
> > > while avoiding smaller whipsaws it will take larger ones
(though
> > > they may be fewer) but also lose good amount of profits at the
time
> > > of exits even when in trend which explains the words of Big
> > > Papa "..For all the testing of the RMO I have done, it is good
at
> > > getting in, but terrible at getting out.."
> > > >
> > > > The limitation of any Moving Average System has probably
been best
> > > described by Preston...
> > > > "If the lag is removed then there are more whipsaws. If the
> > > whipsaws
> > > > are dampened, then the moving average is later to the party.
There
> > > is
> > > > only so much information that can be extracted from price
and
> > > volume
> > > > data no matter how many ways it is tortured, twisted and
> > > manipulated."
> > > >
> > > > Must thank everybody who contributed for a good learning
period
> > > for me.
> > > > gv
> > > >
> > > >
> > > >
> > > > ----- Original Message -----
> > > > From: "pumrysh" <no_reply@xxxxxxxxxxxxxxx
> > <mailto:no_reply%40yahoogroups.com> >
> > > > To: <equismetastock@xxxxxxxxxxxxxxx
> > <mailto:equismetastock%40yahoogroups.com> >
> > > > Sent: Friday, February 20, 2009 4:01 AM
> > > > Subject: [EquisMetaStock Group] Re: adjusted moving averages
> > > &zerolagoscillators
> > > >
> > > >
> > > > > GV,
> > > > >
> > > > > Today you have learned the formula to the RMO/Rainbow and
that
> > > > > programmers never lay all there cards on the table.
> > > > >
> > > > > I'd say you've learned quite a bit.
> > > > >
> > > > > I actually like the recursive moving average and would
love to
> > > see a
> > > > > shorter / easier version of it.
> > > > >
> > > > > Preston
> > > >
> > >
> >
>
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