Wednesday’s Trading, and Silly Vendor Indicators

Just two small trades in the morning… I don’t like trading news-driven environments. The bonds were all out of whack, as can be expected, and it was yet another tight-range day.

This video also discusses a funny moment I had talking with a client today. As many of you know, I code custom indicators and strategies for people (usually eotpro.com clients). Well, this one brought an indicator to me from a vendor, wanting to incorporate it into a strategy. But, there was no function provided, and the code was locked. Now, if this were some fabulous unique indicator, we’d be stuck at this point. That’s one reason I was so pleased to be able to offer the Elite Series add-on to the eotpro indicators… it opens their technology up for use in strategies and custom indicators.

Anyway, this looked like a smooth MA, and it just so happened that the first smooth MA I threw on screen matched the vendor’s indicator almost exactly. So funny… I feel sorry for everyone that’s paying for that one.

For reference, when I want a smooth MA, I always reach for the T-3 average, the Hull average, and the Linear Regression Curve. Usually one of those three will give me what I want. This indicator happened to match the Lin Reg Curve.

Watch this post's video on Youtube

3 Responses

  1. John Says:

    i’ve been using a linear regression MA for awhile…supposedly, its a line of “best fit”

    what are the advantages/disadvantages of the T-3 and Hull’s?

  2. Richard Says:

    Both the T-3 and the Hull are smoothed multiple times. T-3 is smoothed 3 times and Hull is smoothed twice. Both use methods to compensate for the estimated error component, in order to overcome the MA lag. The T-3 is usually more wavy while the Hull is usually more smooth, so I tend to use T-3 for shorter MAs and Hull for longer MAs. But that’s not really a rule… I almost always check them both out and see which one looks better to me in a given situation.

  3. John Says:

    interesting….thanks

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