This thread is on cycle analysis and time analysis
Cycle analysis looks for an understanding of price movements from the perspective of time using the concept of cycles (which comes from the word circle - so circle in time). Cycles abound around us and govern timing of many things in nature. A simple examples are the moon and the sun - monthly and daily. Monthly can govern spawning of sea creatures, a females period etc. Daily (sun) governs biorhythms, plants and animals activities etc. There can be weekly cycles, hourly etc.
The "observed" composite of cycles, cycles laid upon each other produce complex patterns. These the analyst attempts to separate (techniques such as Fourier analysis) etc. Cycles can vary in length of time, start point (and depending on a second dimension amplitude).
A price-time chart can be viewed as a composite of cycles.
When you realize that cycles of different lengths need not all start at the same origin, you can see how complex the composite cycle can become. Then cycles can be viewed on trends/slopes (=the average rate of ascent or decline). A monthly cycle can be uptrending and the weekly downtrending.
If the problem becomes too complex then it is difficult to reduce it into a tractable solution.
Time analysis (as I am using the term) can take a more straightforward approach. Rather than decompose a composite signal you simply take measurements (time swings if you like as opposed to price swings). So you can measure peak to trough, trough to peak, peak to peak and trough to trough. (Price highs and lows are really to define peaks and troughs for finding time lengths.)
Charts are about how to present data in a useful way so as to help one find patterns.
In hand charts you have several advantages the key one is consistent scaling (ratio of time to price). The have a disadvantage - the time it takes to make them. On computer charts convention is to show price on the y axis and time on the x axis (the horizontal) and price proceeding to the right. If you measure peaks to troughs on a chart you get a series of horizontal lines touch each other. In this format it is hard to see patterns and you need to scroll sideways it your cycles are short in relation to the analysis period.
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One method of viewing would be to overlap time length segments and have them stacked vertically. Of course this gives a problem on computer charts as the graphing program draws from left to right as time passes.
see ex 2
This brings us to vertical columns for time and the time swings are shown beside each other creating a point and figure chart. Each chart style is expected to have advantages and limitations.
I had decided to try a hand drawn chart to look for time patterns. Before I started I thought that perhaps someone else in the board of many thousands of members has already tried this and has gained some experience from doing it. And also perhaps someone who knows computing can create one with the computer - (thanks Joel!)
So I did not start a thread in the question box to say here is how to do blah, blah, blah. It is in the question box because it is a question (meaning something I don't have the answer to.) the components of which are:
experience in this
perhaps in a P&F format
Seems silly to explain the question like this but apparently is it necessary. LOL
(Examples to follow as time permits)
PLease don't come into the thread just for fault-finding or to show off what you know that isn't related to the question.
So suggestions of things to try or your new ideas on this project/question are most welcome as are your experiences with time only charting.
Last edited by aquarian1; September 4th, 2014 at 12:14 AM.
As an example if the price swing is 6 pts and the move was up you would have a vertical column of "X"s going up on the y-axis. IF the price was down the chart would move over one to the right and draw a vertical column of "O"s.
the whole point of P&F charts is that they are PURE price charts...there is no volume or time components in this type of chart. Add a time element and they would not be a P&F chart.
I don't see how you would do it other than have mini P&F charts of equal time intervals, but really what is the point?
You are not really understanding how a P&F chart works. It was designed to eliminate small fluctuations in price from the look of the chart.
First of all in your example you have not defined a box size. That is how many points it takes to move an "X" forward or a "O" down. In a normal P&F chart of dollars/cents this is decided based on the share price of the stock itself.
There are traditional box sizes that come down from 100 years ago, but I use User defined ones since the traditional numbers don't work well on stocks under $10.
I apologize for interfering with this post....no need to have banded me from your post here or elsewhere probably...My lips are sealed and will enjoy looking at this new approach.
My user defined box sizes are :
Share price $0.01 to $0.50......... box size is $0.01
Share price $0.50 to $1.00......... box size is $0.02
Share price $1.00 to $5.00......... box size is $0.05
Share price $5.00 to $10.00....... box size is $0.10
Share price $10.00 to $20.00..... box size is $0.20
And more...they are not cast in concrete and may go up or down one box size depending on the volatile nature of the price....they are first approximations.
By what you describe you are using a one point box....which would whip all over the place depending on the value of the object you are charting.
You have to also decide on a reversal policy. If you are in a rising "X" column you don't want to create a new "O" column for a minor fluctuation in points...standard is a "3 box reversal" meaning a point value would have to close (usually...though high/low values can be charted but very complicated to do) at the end of the given time period (usually a day but can be shorter) before the rise or fall is made a permanent part of a chart.
So...if a stock had a value of say $10 and if there was a $0.10 box used...in a rising "X" column the closing price could vary from $9.70 to $10.10 and nothing would change in the chart. If it is a high/low chart it is much more complicated chart and is rarely used I find.
You are describing a one point box with a one point reversal...I cannot see what kind of information that you would get from such a chart that you could not get from a normal line chart.
I use P&F charts a lot...they define resistance/support lines very well since they filter out minor fluctuations also they give a good visual of performance over years.
It may be useful I suppose as I don't know what your objectives are in creating such a chart...
A real P&F chart has no time line on purpose (it is a plot of pure price movement). The x-axis does have time on it by year and the red numbers in the chart itself is the month. But that is just to help you orient yourself to what time all the action was taking (for example if you see red numbers missing it means there was no action during those months....if there were several columns between sequential red numbers then the price was very volatile)
I don't know if this post helps you at all....but I wish you luck in whatever you are trying to do.
Last edited by Underexposed; August 28th, 2014 at 11:30 AM.
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Traditional P&F are price only - clearly I know that. and how to make them.
It would help if you read carefully before posting.
Your long post only derails my thread and is off-topic.
Now other readers will think it is answered when of course it is not.
People do NEW THINGS.
Charts are ways are looking at data and innovations are how new insights are gained.
If you read my post you would understand I am doing something different from price only.
I am doing TIME only.
There is a large body of people who do cycle work (TIME). Price is not used except indirectly to establish the cycle turns.
I gave an EXAMPLE of how it could be made and the EXAMPLE used a 6pt box. The granularity box is up to the chartist and it depends on the trading level of the instrument. You long and off-topic explanation of what you do for traditional price only P&F might be interesting to you didn't bother to ask what I am charting - which is the ES. You do Canadian mining stocks. How many Canadian mining stocks trade for $2000 a share? (As I know a lot about Canadian mining stocks the answer is none.) But again it was an EXAMPLE and the 6 pts is only used to explain how time reversals might be determined.
If you have no experience in TIME p&F then please don't post in reply to a question on TIME ONLY charts
People do NEW THINGS and try NEW THINGS which is how new insights are gained.
Good trading to everyone.
Last edited by aquarian1; August 28th, 2014 at 10:57 AM.
I don't think that is very fair. The thread is mostly about P&F charts it would seem, and his reply is based on this.
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It is not a general thread about P&F charts. -well it wasn't meant to be!
That you could read his post and then conclude that his post - about price dimension - was on the topic of TIME ONLY shows how effectively his post has (unintentionally) derailed the thread to the causal reader. Now that as you as the owner of the board and have judged my response "unfair" the confusion is doubled.
Normal P&F charts are price only. They do not show time. Of the two dimensions in a barchart (price and time) time is omitted. This thread is not about price based charts. This thread was intended to be about omitting price and only showing time - the other dimension. I will be very surprised if anyone will now reply to the original question.
Dear underexposed. I did not suppose that you had anything other than good intentions. However I work 11 hours a day. I only put you on ignore to try and stop a back and forth. There has been a lot of time typing my reply to you to try to get this back on topic, and a lot of time typing the reply to Mike. I am not a fast typist. These two posts to try and salvage the thread (with many, many edits to try and not hurt people's feelings) have taken me more than 1.5 hours.
I have read your edit and taken you off the ignore list.
I am sorry for mis-reading the time aspect of your post. I am still not clear as to your objective and how you would use a time based P&F since such charts are one dimensional (how is price eventually referenced from such a chart?...but then I don't really understand things like tick charts and probably many other other aspects of Ninjatrading...so I should of shut up and seen how the thread progressed.
But to say that I am opposed to experimentation with charts...that is simply not true. You only have to look at my twist on the use of traditional charts to understand that.
I suppose this is a further diversion from your quest and I will shut up and just watch. Hopefully displaying this thread will cause a more knowledgeable person to see it and respond.
I will be quiet now...good luck
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