- Nov 2021
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Long and short call or put options
Can we have a long put and a short call ?? What is the difference between going long and buying a call ?
Equal and opposite positions in the market for a fully hedged position (e.g., hedging one long position with an equally sized short position)
Doesn't it just add up to nothing ? No profit can ba generated from this, it will always be 0 ?
Generally speaking, with the exclusion of late entries, the higher the price of a long entry, the more aggressive in price and conservative in time of entry it becomes
Can we have a situation that is conservative both in time and price ?
- cf. Fig.26.9 for Yes
- cf. Fig. 26.10 for No
=> Yes : cf. paragraph D. of page 843
Support levels for longs and resistance levels for shorts
Isn't there a problem if we long at a breached support ? Same for shorting a breached resisitance ? We want the price to go up for a long and down for a short so it seems to me that it's the inverse ???
Very late short or long entries with respect to support or resistance ■ Very early or premature long entries above support in a downtrend (both aggressive) ■ Very early or premature short entries below resistance in an uptrend (both
Long entries taken below resistance in an uptrend ■ Short entries taken above support in a downtrend ■ Long entries taken just below a failed support ■ Short entries taken just above a failed resistance
Isn't it the inverse ? short entry taken just below/above a failed support (since we want to see price decline)?
$2 per hour over a 10‐hour period.
Why do we consider the time ?
other third‐measure values over similar durations
- What is a third-measure ?
- Which third-measures are they talking about?
- Is it that of stock B that they're talking about ?
i.e. Compare third-measure of stock A to that of stock B over similar durations to find which one is the more volatile ?
ncrease in Price Fluctuations over Equal Durations Indicating Potential Rise in Volatility
Why is the first measure of volatilty satisfied ?
Maybe because the time period is the "equal duration" ??
over equal durations
How do we pick the durations ?
we could not determine which stock was more volatile since the maximum amount of price change over equal durations were the same for both
- What about comparing over smaller time periods, if we do this, we'll clearly see that there are differences ?
- How do we pick the timeframe ?
bearish chart patterns within a falling channel and bullish chart patterns with a rising channel.
Strange since it's the opposite for wedges, and wedges resemble channels quite a lot ?!
Many of the failed buy signals found on the chart in Figure 12.15 would have been successfully avoided or filtered out had the reversal entry breakout tech-nique been employed
Reversal entry breakout -> return to the mean ?
Figure 12.11 is an example of tuning the fixed percentage bands to a domi-nant cycle on the four‐hour chart of GBPUSD. The trough‐to‐trough cycle period was 133 bars. Using the third formula would also yield ((2×133) +3)/4 = 67.25. Rounding to the closest integer would give us 67 periods or bars
Does this mean that the central line is the 67 lookback period and that we obtain the bands by fixed perccentage (here 1.3%, cf. Fig. 12.11) ?
Notice that un-like double and triple detrending, which tends to remove lag between the oscillator and price, double and triple smoothing increases the price lag.
What is the difference between detrending and smoothing ?
- smoothing = prendre le MA d'un oscillateur. Ex. : %D = 3-period SMA of raw %K
- detrending = faire la différence entre deux MA !
double detrending reduces the lag components between price and the oscillators
Why 7 and not 3 as indicated page 260 ?
what does a nine-period EMA mean ??
Periods 2/Exponential Weighting Ratio 1
- How do we get this formula ?
- What does the term periods actually mean ?
- Oct 2021
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