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Re: Band-its...?



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Alex wrote:
> >Of course, you couldn't use that to trade, since you have no 
> >knowledge of future data points (bummer!).  If that's what those 
> >charts really are, then they're just dummied-up pretty sales 
> >tools that couldn't actually be used for trading.
> 
> Not necessarily.  You don't need future points to fit a polynomial
> to data.  

No, you don't.  But the results you get at the "right edge of the 
chart" will be very different than what you'd get with knowledge 
of future data.  I don't think you could get the kind of curve 
he's showing without future knowledge.  They're just too perfect.

It's interesting to note that none of his "sample charts" have 
been updated any more recently than early March.  Maybe he just 
doesn't update his site very often.  Or maybe he wants 6 weeks of 
future knowledge to curve-fit his charts....

> >he couldn't be using a polynomial-fit curve for his trading 
> >decisions.
> 
> I think he could in this context.  Think of it this way: for markets
> with seasonal tendencies, the tendencies average out to a sinewave
> having a period of 1 year.  A sinewave for a single period can be
> well-approximated by a polynomial. 

Maybe, though I seriously question whether you could get results 
as perfect as he's showing.  And I don't think e.g. SP500 or IBM 
(which are two of the charts he has in his "Sample Charts" 
section) show that perfect a seasonal tendency.

Gary