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I use the centered ma's with there 2nd derivatives to trade the markets and make general predictions with very good accuracy.
Kinda like in the Hurst Book except I calculate the 2nd Derivatives to see how the slope is likely to change tomorrow and what prices will make the slope change which way.
It works Great !
Dale
-----Original Message-----
From: Carroll Slemaker [SMTP:cslemaker1@xxxxxxxx]
Sent: Wednesday, September 23, 1998 6:53 PM
To: omega-list@xxxxxxxxxx; Dejan.Corovic@xxxxxxxxxxxxxx
Subject: Re: Two Questions
Dejan -
I'll let someone else answer the close/settle question. I assume that
you mean an end-of-day price quoted for a futures contract. I don't
know if there IS ANY difference between these terms for an ordinary
day's close - the terms may mean the same thing.
On expiration day, however, they are different, and there is even a
different symbol for the final settlement price. This final settlement
price is, I believe, the price credited to your account if you are
holding a long contract at expiration. And it is calculated, I believe,
as some function of prices occurring during a particular part of the
trading day. I THINK there is a definition of this term somewhere at
the CME's web site.
Anyway, perhaps someone else can do a better and more reliable job of
explaining these terms.
The terms "centered" and "trailing" MA both apply to ordinary arithmetic
moving averages. The difference is simply in how they are plotted.
The "proper", or neutral way to plot a MA is as a centered MA. Consider
that each individual average is a single point which best represents a
set of n points. Therefore, the "proper" place for that point is at
average Y AND average X. In other words, the X position of this point
will be in the middle of the X-span of the n points. Another way to
look at this point is that it should appear at what might be considered
the "center of gravity" of the set of n points.
So if each average is plotted in this manner - at the mid-point of the
X-range of its n points - the result is a centered MA.
A trailing MA is produced simply by placing each average Y at the X of
the LAST point of the n-points in that average.
With a centered MA, the raw data will be seen to wander back and forth
around the MA - the MA will appear as a smoothed copy of the original
data. A trailing MA will have the same shape, but will be phase shifted
- it will lag the raw data (that is, it will peak or bottom AFTER the
raw dat peaks/bottoms).
Hope this answers your question.
Regards,
Carroll S.
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