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Strategies & Market Trends : Technical Analysis- Indicators & Systems

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To: Richard Estes who wrote (400)	2/23/1997 11:17:00 PM
From: GW Riedeman	of 3325

As regards the equation for "Linear Trend," I have a few observations: The equation is identical to the equations for the difference of least squares slopes of closing price data for two different time frames, 13 and 21 periods. I suggest one plot the following formula on the same plot as the submitted "Linear Trend" formula -- you will find them identical (in WOW -- I expect the same in Metastock, differing only in what Metastock calls 'slope') (sin(slope(c,13))-sin(slope(c,21)))*100 The sine functions only provide some weird sort of scaling. The slope itself is the tangent of the angle of the linear squares best fit line through the data. I have no idea of what the sine of a tangent of an angle gives, particularly when the value of a tangent is not scaled in the proper units for the sine function. WOW expects the sine argument to be in degrees. I suspect that it is used simply as some form of heuristic scaling, i.e., no reason for it, but it seems to work. If one wants to add a moving average, as Andy did, simply wrap the MA around the above equation. Questions and comments gladly ignored.....Bill

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