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GoldTheHun replied Nov 18, 2014Totally agree that %50 - %50 is not the reason for Gaussian distribution, I just quoted that specifically for the range bar situation, bound by 10 pip up down range. For normal time bars, Sqrt(Number of bars) * ATR(some large value) could be used. ...
Choppy market index: any good ideas?
- GoldTheHun replied Nov 18, 2014
Exactly it becomes Gaussian, because of the %50 - %50 probability of next bar up or down, just like a coin toss. I think the best way to do it is using monte carlo simulation. This way you can see the probabilities of 7th bar in future (or any other ...
Choppy market index: any good ideas?
- GoldTheHun replied Nov 17, 2014
Well with range bars, say 10 pip. The next bar going up or down 10 pips is a %50 chance. So if one limit number of bars to check back, let say 4 bars. So one can multiply probabilities. So 4 bar up in a row would be (0.5 ^4) would be 0.0625 or ...
Choppy market index: any good ideas?