This seems hardly possible, as most things in technical analysis are subjective. If I were to attempt to approach this I would start with the two most simple, and I guess most used indicators: Support and Resistance. To me it seems, from what I've read that most 'drawings' of Support (S) and Resistance (R) seem to be parallel. I would like to hear if there is a situation in which this isn't the case. The algorithm for proposing the S&R limits seems easy, start in the middle and move outward until nearly all (if not all) are enclosed by the 'bands'. The hardest algorithm is length. How does one gather the length of the s&r lines? I guess this could be simple: a selection by the user. Let's say they adjust it to '1 month'. Now its easier. Next, where to start measuring from? Again, to start simple one could have the user click a point (on an interface). I realize these are simplistic and not pure automation. However, with enough data a machine could learn the user's habits and automate the selection (of length for sure). This leads to how one could automate the center point of the s&r line. Let me think more about that...
How about if one open a tool and saw past s&r lines that include today (as the last point), today as the center (of new s&r lines), and today as the start of new s&r lines (assuming today is a low or high within the time frame selected). Does any of this make sense? I still think there is some meat to this idea, and also feel that 'techies', as I'll call them, would like 'assistance' in selecting their lines as I'm sure everyone has different s&r lines on their screen.
Any ideas?
Wednesday, April 8, 2009
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