moving averages!!!

crazytrader1 · Apr 6, 2007

Hi everyone, just joined these boards, anyways to the point.

What common moving averages do you guys use for yearly charts, day charts, and 60 minute.

I'm trying to find out most commonly used moving averages, and it seems that everyone has their own moving averages.

I usually use 10 day, 20 day, 50 day, 100 day and 200, day for day charts, all of them being Simple.

And i use 10, 20 period moving averages for 60 minute.

So whats up? Which most commonly ones do you guys use?

TSOKAKIS · Apr 6, 2007

Quote from crazytrader1:

Hi everyone, just joined these boards, anyways to the point.

What common moving averages do you guys use for yearly charts, day charts, and 60 minute.

I'm trying to find out most commonly used moving averages, and it seems that everyone has their own moving averages.

I usually use 10 day, 20 day, 50 day, 100 day and 200, day for day charts, all of them being Simple.

And i use 10, 20 period moving averages for 60 minute.

So whats up? Which most commonly ones do you guys use?

You may know the MA cross one bar before the actual cross and decrease the lag. Take a look at the recent
http://www.traders.com/Documentation/FEEDbk_docs/Archive/022007/Abstracts_new/Tsokakis/tsokakis.html
http://www.traders.com/Documentation/FEEDbk_docs/Archive/032007/Abstracts_new/Tsokakis/tsokakis.html
for an accurate [and simple] approach.

itmediaco · Apr 6, 2007

A while ago, Dr. Koch from the WL board analyzed several filters to determine lag and the 1st derivative of price change.

SMA, WMA, and EMA performed the worst. (Not surprisingly 99% of packaged trading systems are based on these)

Butterworth filter having 3 poles demonstrated the smoothest speed curve, but lagged at sharp price movements.

He concluded that a Gaussian filter having 4 poles has the least lag, and a smooth speed curve.

TSOKAKIS · Apr 7, 2007

Quote from itmediaco:

A while ago, Dr. Koch from the WL board analyzed several filters to determine lag and the 1st derivative of price change.

SMA, WMA, and EMA performed the worst. (Not surprisingly 99% of packaged trading systems are based on these)

Butterworth filter having 3 poles demonstrated the smoothest speed curve, but lagged at sharp price movements.

He concluded that a Gaussian filter having 4 poles has the least lag, and a smooth speed curve.

I have released some years ago the M/A crash test.
http://www.amibroker.com/library/detail.php?id=116
It is a very simple way to check the response of various averages and see what you need. The maths are as simple as possible.

daytrademargin · Apr 7, 2007

Quote from crazytrader1:

Hi everyone, just joined these boards, anyways to the point.

What common moving averages do you guys use for yearly charts, day charts, and 60 minute.

I'm trying to find out most commonly used moving averages, and it seems that everyone has their own moving averages.

I usually use 10 day, 20 day, 50 day, 100 day and 200, day for day charts, all of them being Simple.

And i use 10, 20 period moving averages for 60 minute.

So whats up? Which most commonly ones do you guys use?

Everyday your moving averages will change. You have to adjust them daily to see what ones are accurate for that day. Because everyday the market moves differently. One day you might be able to use a 10 and 20. But the next day, those MA's will be too fast or slow and give false readings. So you have to adjust them until you find they are insync with your bars or candles.

daytrademargin · Apr 7, 2007

Quote from itmediaco:

A while ago, Dr. Koch from the WL board analyzed several filters to determine lag and the 1st derivative of price change.

SMA, WMA, and EMA performed the worst. (Not surprisingly 99% of packaged trading systems are based on these)

Butterworth filter having 3 poles demonstrated the smoothest speed curve, but lagged at sharp price movements.

He concluded that a Gaussian filter having 4 poles has the least lag, and a smooth speed curve.

Huh?

Hook N. Sinker · Apr 7, 2007

Quote from daytrademargin:

Huh?

Butterworth filter having 3 poles http://en.wikipedia.org/wiki/Butterworth_filter and Gaussian filter having 4 poles are mathematical descriptions of electronic filters. I recall reading that electronic engineers are interested in filtering out certain frequency signals, or blocking only high frequency signals and passing only low frequency signals.

Such filters might be used to design mechanical trading systems.

Traders might be interested in systems that show buy or sell signals as soon as price changes or might prefer to wait until the price change is more clearly established.

Emphasis on moving averages is misplaced. Nothing predicts the future reliably and consistently correctly. Much more important than the type of indicator used to follow trends is ability to stick to the system during a losing streak and choosing a compatible risk level.

<img src=http://pentaclerecords.net/darien3/oz_scarecrow_1.jpg \img>

Scarecrow resume: Defeats wicked witch. Granted PhD by the Wizard Of Oz. Helps Dorothy return to Kansas. Has no brain. Succeeds mostly by sticking to the plan.

kiwi_trader · Apr 7, 2007

Quote from itmediaco:

A while ago, Dr. Koch from the WL board analyzed several filters to determine lag and the 1st derivative of price change.

SMA, WMA, and EMA performed the worst. (Not surprisingly 99% of packaged trading systems are based on these)

Butterworth filter having 3 poles demonstrated the smoothest speed curve, but lagged at sharp price movements.

He concluded that a Gaussian filter having 4 poles has the least lag, and a smooth speed curve.

And in the words of a wise man, "so what?"

feb2865 · Apr 7, 2007

Quote from daytrademargin:

Everyday your moving averages will change. You have to adjust them daily to see what ones are accurate for that day. Because everyday the market moves differently. One day you might be able to use a 10 and 20. But the next day, those MA's will be too fast or slow and give false readings. So you have to adjust them until you find they are insync with your bars or candles.

Don't you think that's a lot of work in top of what we have to face as a traders everyday??

Don't mean to be rude by all means. Just realistic

On no grounds to hijack the thread but, learn to read price action - simpler and more effective

Peace

murray t turtle · Apr 7, 2007

Quote from crazytrader1:

Hi everyone, just joined these boards, anyways to the point.

What common moving averages do you guys use for yearly charts, day charts, and 60 minute.

I'm trying to find out most commonly used moving averages, and it seems that everyone has their own moving averages.

I usually use 10 day, 20 day, 50 day, 100 day and 200, day for day charts, all of them being Simple.

And i use 10, 20 period moving averages for 60 minute.

So whats up? Which most commonly ones do you guys use?

=================
CR-T;
Tested a lot of combos, lots of years, lots of ma;
and would recommend that to any one also.

Interesting your nickname initials like are Chicago Research /Trading

50 dma is quite useful;
QQQQ,ES, SPY never stayed much above 50dma on 2-27-07,
a sell signal., in my business plan usually.

Way of the Turtle book uses much longer ma ;
but i would rather err on conservative side far as intellectual property/copy right law.