Many Systems, especially simpler trendfollowing ones, do not trade every signal, but only during the more active times, when for example breakouts are more likely. The simplest method is to only trade during a certain time of the day.
I'd like to find or make the best indicator to determine market activity without relying on time. Please post your suggestions.
First I thought of using the tick volume data. Since it's so short term (for every candle) I applied a Moving Average to reduce the noise, and the result wasn't bad – but it was almost identical to ATR!
The next idea was, that during more active times, the prices were probably 'oscillating' more often, so we divide the tick volume of a candle by the high-low range resulting in 'tick changes for every pip actually moved'.
The result looks pretty good, imho.
Please note that the tick volume data differs between brokers.
http://img124.imageshack.us/img124/7...atilityjj3.gif
Edit: Sorry for the grammar mistake, I can't seem to edit it. No you're not a filter! ;-)
I'd like to find or make the best indicator to determine market activity without relying on time. Please post your suggestions.
First I thought of using the tick volume data. Since it's so short term (for every candle) I applied a Moving Average to reduce the noise, and the result wasn't bad – but it was almost identical to ATR!
The next idea was, that during more active times, the prices were probably 'oscillating' more often, so we divide the tick volume of a candle by the high-low range resulting in 'tick changes for every pip actually moved'.
The result looks pretty good, imho.
Please note that the tick volume data differs between brokers.
http://img124.imageshack.us/img124/7...atilityjj3.gif
Edit: Sorry for the grammar mistake, I can't seem to edit it. No you're not a filter! ;-)
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