Logarithmic Spirals appear
in nature and may be helpful to predict if a price bar is a potential turning point.
I represent them similar to the way in
this book with a
- Center Point -- x,y coordinate
- First Point -- x,y coordinate
- Growth Rate (greater than one) -- how much the distance to the center is multiplied for each revolution added
- Direction -- counterclockwise or clockwise.
In each the following charts,
- The center point is a +
- Five Wave points defined similar to those in this post are squares
- Each bar is for a calendar day, and when the market is closed, the price is linearly interpolated from the previous market close to the next market open
- Prices are adjusted for splits and dividends, and the prices and times are scaled from 0 through 100 from the actual price and bar index values of the wave points
- The bar the most recent wave point was detected on has an X at the end
- The triangle at the end of a bar is the current bar to be checked. It will always be at or after the X. Bars after that show what happened next
- The dates on the X axis label are for the first wave point and the current bar
- The small diamonds are points on the spiral separated by one degree of arc. To keep the charts readable, the spirals are cut off if they go too much out of the chart time and price range
View attachment 297588 View attachment 297590View attachment 297591View attachment 297592 View attachment 297593 View attachment 297594
I wrote software to find a spiral that goes near the wave points. The code uses the scaled x,y coordinates of the wave points and no other market data to create the spirals. When the spiral also goes near the current bar, the current bar seems to often be at or near the next wave point.
Has anyone used logarithmic spirals to help with trading?