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> > > This Fisher transform is kind of odd. Looking at the code,
> > > Value1 is just a smoothed Stochastic re-centered around zero.
> > > Then he takes log((1+Value1)/(1-Value1)) and smooths that. I'm
> > > not sure what the log calculation is supposed to accomplish. It
> > > basically just amplifies the smoothed stochastic, exaggerating
> > > the points where the stoch approaches +/- 1. He pegs the extreme
> > > values of value1 at +/- 0.99, which ends up limiting the Fisher
> > > value to +/- 5.29. Why? Beats me. Guess he wanted to make it
> > > really obvious when the stoch value was approaching its max/min
> > > values.
> >
> > Apparently the limits are imposed to prevent value1 exceeding its 10
> > (len) day range and crashing due to having a zero in the
> > denominator.
>
> Yes, I was unclear. The "Why? Beats me" meant I wasn't sure why
> he did the log((1+V)/(1-V)) calculation.
>
> > The exaggeration around the +/-1 points is to simulate the
> > Probability Density Function of a sine wave. or something - don't
> > ask, it's beyond me! (:-)
>
> Hm. I'm not sure why he wants to simulate a PDF, but I suspect
> it's not relevant for the usage you have in mind.
>
> If that's the case, then for your purposes this Fisher transform
> is nothing but a smoothed stochastic.
>
> Gary
Possibly, but I think it's a very nice smoothed stochastic (:-).
Ian
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