What is numerical price prediction?
In attempting to come up with a successful trade strategy, I adopted the biblical principles of testing all things and holding fast to that which is good; and of knowing how to judge the signs of the times. This led me to reject the use of all indicators with the exception of moving averages and moving average envelopes.
I began looking to enhance the system on Saturday, August 12, 2017, which led to what I presently call the Numerical Price Prediction (NPP) Forex trading system, though I recently found it works just as well with the S&P 500, Dow, and NASDAQ. The goal is to apply the use of technical analysis to make market forecasts in the same way meteorologists use computer models to forecast weather.
This means noting precise, up-to-date, quantitative information about the current state of affairs at a given place and time, and interpreting the data to make accurate predictions, except instead of using air pressure, temperature, cloud location, wind direction/velocity, and humidity...I am using trend lines, market structure, average price ranges, historical support/resistance levels, and repetitive price patterns; or to be more specific, I am evaluating/interpreting how they all interact and relate to one another.
As with numerical weather prediction, there are intrinsic predictability limitations that lead to error growth with time, so I apply this approach exclusively to intraday trading. Proprietary moving averages and adaptive price zone envelopes are used to simulate the equations, wave functions/representations, and grid point/spectral/coordinate models used in numerical weather prediction, as represented by the much simplified graphic I pasted below, which illustrates where I would typically purchase in-the-money 5-minute binary option put and call contracts with a near 100% success rate.