What is a trend? - page 52
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signal = trend + noise
A mixture of trend and noise is available for observation. In order to determine the trend, the noise must be removed from the mixture.
I will explain it in pictures to make it clearer.
Suppose that there is a line consisting of trUP, flat, trDN, flat, trUP
.
There is a noise with parameters that depend on the current value of the trend line
.
Let us now add noise to the trend line
.
Now let's hide the trend line .
.
The resulting signal, i.e. the mixture of trend and noise, can be seen on the quotation charts. This is what we get in the form of quotations.
You cannot see the trend but it is there ;)
Moreover, by changing the noise intensity the current trend can be very effectively hidden.
If you haven't figured it out in 51 pages, it's a deafening number to figure out later).
Because it's a philosophical question:) Here's a life situation - A person works in some company, grows up in his career (like UPtrend). But the company's financial results are getting worse and worse and one "beautiful" day the company goes bankrupt. (I think it's DOWNtrend at the time). But the Company itself is in a country with a growing economy (Uptrend again):) Same with price and timeframe:) Only the percentage of bulls and bears is an absolute indicator.
That's how it is in life: we operate with concepts we don't know ourselves.
That's how I became an ignostic.
The movements "revolve" around average values i.e. simple MA what period? individually depending on trading style , (I don't think 5-8 year horizons are being discussed).
)))) The movements "revolve" around the averages i.e. simple MA))) //You're just kidding, right?))) And what are the averages based on, aren't they based on thrusts?))) There will be no movements, there will be no averages...
Moreover, by varying the intensity of the noise, you can hide the current trend very effectively.
Can you change the intensity of the noise?
In the example given? I can.
In the quotes? No, I can't.
But the company supplying the quotes can.
)))) The movements "revolve" around average values i.e. simple MA))) //Are you just kidding?))) And what averages are built on, aren't they based on movements?)) There will be no movements, there will be no averages.
The market momentum is always historical data, I don't create and analyse trend models based on future events that don't exist as a fact.
By the way, we can give a technical (algorithmic) interpretation to the concept of a Dow Trend.
1. We build a zigzag, let's call it basic. Using fractals or High-Low or by the ZigZag indicator, i.e. any way at all. The main thing is to distinguish any alternating price extremums
2. by the definition of the Dow, we construct a derivative zigzag; the rule for the zigzag reversal is a breakdown of the last 2 opposite extrema.
3. step 2 is repeated several times
After several iterations (2) the obtained figure will be identical regardless of the basic zigzag mark-up method.
The resulting figure can be named a trending zigzag by the Dow, and the number of repetitions #2 is its order.
The iterative method of mark-up is very "behind" the real time and is difficult to apply in trading, that is why everybody is looking for other ways to "find out the trend".
but at least it's some sort of technical definition
On the buy, the break of the min of the current extremum and then the break of the max of the current extremum THIS IS THE BEGINNING OF THE NEW TREND AND THE END OF THE OLD TREND. And then there is a check See Pictures.
There are exceptions, which I will not describe, because this branch only discusses the general definition of a trend... .
On the buy, the break of the min of the current extremum and then the break of the max of the current extremum THIS IS THE BEGINNING OF THE NEW TREND AND THE END OF THE OLD TREND. And there is also a check See pictures.
I will not describe the exceptions because this branch deals only with the general definition of the trend... .
Rustam, insert pictures in a human way.