Roy,
That’s
not always a problem. Hindsight and lack of a hard right edge is fine if you
are only trying to determine the most recent or current cycle wavelength and
channel limits. It’s usually quite to extrapolate into the forward-referenced
zone by eyeballing, as per Hurst’s
book….A book that was written in 1970 and still perfectly valid today.
Why? Because it speaks truth.
Anyone who
uses a moving average *without*
centre-ing it is, in my view, either blindly following common practice or deliberately
trying to exploit the Law of Self-Perpetuating Myths (i.e. it works because
enough people believe in it). That’s fine if it actually does work and
that you understand that the practice is at odds with mathematical logic…and
don’t cry when you get whipsawed.
Optimum gains
always require a little discretion… if traders would only learn to use
their brains a little bit instead of wanting everything validated by mechanical
back-testing to the Nth degree then they might learn that returns in excess of
20% per annum are readily available and that Hurst’s astronomical claims
in his introduction are not exactly without merit.
It becomes a
toss-up between whether you believe that forward referencing is an inherent
evil that defeats the whole purpose of TA…or whether you believe, like I
do, that the market is not so easily quantified and the optimum solution is reached
when you start to use your computer as a labour saving device that *helps* your analysis, as opposed to *defining* it.
My experience
is that if you couple Hurst’s techniques with a good leading indicator, such
as divergence, as means of confirmation and a decent appreciation (using
indicators and plain common sense) of when the market is cycling or trending on
the time-frame up from the one you are trading on then you can often pick tops
and bottoms with a very good hit ratio. Obviously then good money management is
essential to limit the wicked damage that is otherwise possible when you get it
wrong. It’s all in Hurst’s
book…apart from the divergence bit.
Trouble is (for
you and anyone else who doesn’t believe the logic) that I can’t
validate that statement with a nice system test print out.
Andy
From:
equismetastock@xxxxxxxxxxxxxxx [mailto:equismetastock@xxxxxxxxxxxxxxx] On Behalf Of Roy Larsen
Sent: Wednesday, December 14, 2005
5:18 AM
To: equismetastock@xxxxxxxxxxxxxxx
Subject: Re: [EquisMetaStock
Group] Hurst
Channel
My understanding of Hurst
channels is that they're supposed to be centred moving averages, and that makes
a forward reference (or 4) essential. If someone can use that to trade
then good luck to them.
----- Original Message -----
Sent: Wednesday,
December 14, 2005 11:30 AM
Subject: Re:
[EquisMetaStock Group] Hurst
Channel
Roy,
if CY1 =10
Wouldn't
"T1:=Ref(Mov(CLOSE,CY1,S),CY1/2)+M1*ATR(CY1);" include a
postive
reference of ten?
If so, I would think that this code could be
wrong.
Cheers,
Cameron
From: "Roy Larsen" <rlarsen@xxxxxxxxxxxxxx>
Reply-To: equismetastock@xxxxxxxxxxxxxxx
To: <equismetastock@xxxxxxxxxxxxxxx>
Subject: Re: [EquisMetaStock Group] Hurst Channel
Date: Wed, 14 Dec 2005 09:03:54 +1300
Hi Wallace
I found this using Google.
http://www.stoploss.ch/Metastock_Hurst_Channels.htm
And the code is..
{Hurst
Channels}
CY1:=Input("Short Cycle
length",1,1000,10)/2;
CY2:=Input("Medium Cycle
length",1,1000,80)/2;
M1:=Input("Short Cycle
Multiplier",.01,10,1);
M2:=Input("Medium Cycle Multiplier",.01,10,3);
T1:=Ref(Mov(CLOSE,CY1,S),CY1/2)+M1*ATR(CY1);
B1:=Ref(Mov(CLOSE,CY1,S),CY1/2)-M1*ATR(CY1);
T2:=Ref(Mov(CLOSE,CY2,S),CY2/2)+M2*ATR(CY2);
B2:=Ref(Mov(CLOSE,CY2,S),CY2/2)- M2*ATR(CY2);
T1;B1;T2;B2;
Regards
Roy
www.metastocktips.co.nz
----- Original Message -----
From: murusprimus
To: equismetastock@xxxxxxxxxxxxxxx
Sent: Wednesday, December 14, 2005 4:07 AM
Subject: [EquisMetaStock Group] Hurst Channel
Hi, does anyone have a Hurst Channel formula/s
they would post please.
TIA. Wallace
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