exactly...im having serious doubts now. but im using it with other stuff for confirmation and its not too bad.

about raising the value to the power of volume....it was noted that the original formula by the author did not include raising power. it was only after raising the power to volume, the author was able to filter out many more false signals. but yes i thought about MACD in the formula....it really didn't make sense.

can u share with us how are u using other stuff for confirmation? thanks

i donno about others but i do find it profitable so far...i will continue to forward test. ( again going only long and only if the previous value is zero and next bar is higher evben the slightest.) .

if in doubt, look at other indicators.

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Hi,

Thanks for everyones input into this thread. I think there is potential with this indicator. I have tried it on 1 minute charts and when the histogram gets very low and then rises it does appear to offer some buying potential.

I have a suggestion to possibly improve this indicator by adding a fisher transform to it http://media.wiley.com/product_data/...0471463078.pdf.

Does anyone know how to do this?

thanks,
Trader

This indicator was not made and tested in forex market. I think it was made for platform where there is no non-integer values. For instance value of cable would be 20770. Then MACD would have been significant.
But anyway, I don't see any mathematical point of adding MACD to RSI. It is like summing absolute and relative speed. Also I don't understand why the author sums an oscillator which moves around 0 and oscillator which moves around 50, I would deduct from RSI value 50.
I think something wrong with the formula, but the idea of mathematical filter is worth researching.

Wookey

May I politely suggest this may be a joke. Arbitrarily adding some oscillators together is just going to give you...another oscillator.

your correct. this indicator was designed and tested on crude oil futures.

interesting note however, it was tested with US treasury bills and the success rate was higher 90%ish.

currency futures would be more successful according to the papers.

im continuing to forward test....only buying at zero and selling when histograms start to fall. i will post up a full statement at the end of this week.

yes the author used a now-defunct program called Wall Street on Windows....this paper was written around 1997....10 years ago.

but that is a very interesting discovery, what if we converted our prices like u say would MACD be significant....

but i mean this is as close i got to actually achieving the pictures described in the papers ( see earlier posts). also before the volume was normalized and placed into calculation, it imitated the pictures, however it was not viable.

i'd love to post the paper again, but its 200 pages. and i've went to search for it again at the library last week and it was gone....so i donno what happened.

i've tried to contact teh author MULTIPLE times both through my finance department and the professors who have witnessed the defense. they do not know where and how they can contact the author either....so do ireally think these profs would let fake papers pass through like this ? i do not think so. i've put the paper into their lights, but htey dont give a shit about undergrads.

You may consider PPO instead of MACD. Percent Price occilator. It is a MACD but in percent terms. So it doesn't matter if it is forex, oil, etc. Do a search for it, it may help.

interesting. attached are some screen shots on futures. first one is on light, sweet crude oil. 2nd is a magnification of it....the graph looks shockingly similiar to the ones described in the papers (the author tested on the same sweet crude oil)

the 3rd screenshot is of mini -sized dow....im wonder if now we can apply volume back to the formula. perhaps try this with sweet crude oil as well?

4th is soybeans.

5th shot is wheat.

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	soybean.gif (20.2 KB, 463 views)
	wheats.gif (19.7 KB, 462 views)