Wednesday, January 12, 2011

Displacement issues

Q: TradeStation, Ninja Trader and other trading platforms allow showing indicators with some displacement against original price chart. How we can pick up the best displacement for indicators?

A: Our platform is not just another technical indicator suite. Instead, it is the complex forecasting engine carefully tuned up to the incoming data stream. We took extraordinary efforts to ensure the precise synchronization with the incoming data to achieve the best possible accuracy of market indicators.

Artificially displacing indicator against its original market synchronization will completely obscure its built-in forecasting ability and will produce completely misleading results lacking any validity. It will yield artificial results and will prevent the tests on historical data to match real live market performance because broken synchronization will cause engine to use forward-looking information and fake all historical testing process. At no circumstances user can introduce any displacement to indicator displays to avoid false results and overall confusion.

Predictors behave different to indicators in terms of displacement. By meaning, they express future value intrinsically displaced into the future on the number of steps equal to the forecast length input into algorithm. We calculate market predictions for the next market step or, with the less accuracy, for the few next steps. It is advised and encouraged to adjust manually predictors exactly to this amount of forward steps (typically one) to get best trading advises.