How to calculate "Limit Move(T)" in Swing Index?

I'm trying to draw Swing index chart in android app using it's equation

I cant understand the T(Limit Move) value in this equation. I found this definitions when i search it in google...

* "The largest price change allowed for a given futures contract in a single day, as determined by the exchange. also called maximum price fluctuation."

* "the maximum price changing during trade session"

if anyone can help me to get clear idea about this value or any equation to get this value, it will be a big sup to me...THaNx!!!

Hi.

Well I'm really pleased to see that SOMEONE is trying to CORRECTLY code the Swing Index System (and therefore the ASI)!!! Other than myself that is!!! LOL!!!

Some background:

I've spent years trading Wilder's trading systems and my main trading system IS INDEED the Swing Index System. It cannot be beat in my opinion. Anyway: I like to think I'm an authority on ALL of J. Welles Wilder Jnr.'s work so hence my posting here and attempting to give you a helping hand.

In short: limit moves TODAY are VERY different to what they were in 1978 which is when he developed and published the system. VERY VERY VERY few instruments TODAY have a FIXED limit move. This was NOT the case in 1978. The Dow for example has TOTALLY different limits or circuit breakers than it had in 1978 and they are not fixed anymore but based rather on certain percentage moves and timed moves. So to solve your problem or answer your question: simply remove the "* K/T" from the equation (and actually as per the original system it should be "K/L" where "L" is the limit move). That's it. Trust me when I say that there is no other way to do it. I spent at LEAST a year perfecting my Swing Index System "indicator" and this was the ONLY way I could get it right and still have the Trailing INDEX SAR working correctly and behaving as it should and as described in the book.

Be VERY careful when doing the greater than or equal to comparisons as well i.e. ensure that you trap for every possibility otherwise you'll find that at some point the "indicator" will crash or give you false readings. The best advice I can give you is to create an Excel Worksheet, input Wilder's example prices, and ensure that you get the same results. Then substitute his values for your own prices and compare the Worksheet to your Swing Index System "indicator" to ensure you're getting the same values as shown on the Worksheet.

In addition: I do NOT round the result i.e. rounding sometimes results in your missing a valid profitable trade completely.

By the way: I hope you have the ENTIRE calculation i.e. that formula that you're showing is NOT the ENTIRE calculation (in other words "C" and "O" are NOT "Open" and "Close"). If you already know that then my apologies but it may be confusing to anyone else that reads this thread.

What's more (just some useless information): I have yet to see a trading platform where even the ASI ("Accumulative Swing Index") is coded and calculated correctly as per the book. One VERY fine example is the one supplied as standard with MetaTrader!!! Can you believe that!!! I've also seen some rather interesting (and incorrect) variations of RSI, ADX, and Parabolic SAR and then people wonder why they cannot make money using Wilder's trading systems!!!

I have my own forums that are pretty much dedicated to Wilder's trading systems and how I trade and there are some examples on the forums that are publicly viewable. My forums are at techtradercentral.net.

I hope this helps.

Regards,

Dale Paterson.

By the way: I've attached a daily chart of the Spanish IBEX35 showing a CORRECTLY calculated ASI (the blue line) and the Trailing INDEX SAR (the green and red dots). It's the first "indicator" on the lower portion of the chart.

In case anybody is wondering why I'm using quote marks when referring to the Swing Index System "indicator": it's not REALLY an indicator in the true sense of the word i.e. the Swing Index System is based on price and price alone and there are no lagging components etc. such as moving averages or average calculations or anything like that. That's why I hesitate to call it an indicator!!!

dpaterso wrote:Hi.

Well I'm really pleased to see that SOMEONE is trying to CORRECTLY code the Swing Index System (and therefore the ASI)!!! Other than myself that is!!! LOL!!!

Some background:

I've spent years trading Wilder's trading systems and my main trading system IS INDEED the Swing Index System. It cannot be beat in my opinion. Anyway: I like to think I'm an authority on ALL of J. Welles Wilder Jnr.'s work so hence my posting here and attempting to give you a helping hand.

In short: limit moves TODAY are VERY different to what they were in 1978 which is when he developed and published the system. VERY VERY VERY few instruments TODAY have a FIXED limit move. This was NOT the case in 1978. The Dow for example has TOTALLY different limits or circuit breakers than it had in 1978 and they are not fixed anymore but based rather on certain percentage moves and timed moves. So to solve your problem or answer your question: simply remove the "* K/T" from the equation (and actually as per the original system it should be "K/L" where "L" is the limit move). That's it. Trust me when I say that there is no other way to do it. I spent at LEAST a year perfecting my Swing Index System "indicator" and this was the ONLY way I could get it right and still have the Trailing INDEX SAR working correctly and behaving as it should and as described in the book.

Be VERY careful when doing the greater than or equal to comparisons as well i.e. ensure that you trap for every possibility otherwise you'll find that at some point the "indicator" will crash or give you false readings. The best advice I can give you is to create an Excel Worksheet, input Wilder's example prices, and ensure that you get the same results. Then substitute his values for your own prices and compare the Worksheet to your Swing Index System "indicator" to ensure you're getting the same values as shown on the Worksheet.

In addition: I do NOT round the result i.e. rounding sometimes results in your missing a valid profitable trade completely.

By the way: I hope you have the ENTIRE calculation i.e. that formula that you're showing is NOT the ENTIRE calculation (in other words "C" and "O" are NOT "Open" and "Close"). If you already know that then my apologies but it may be confusing to anyone else that reads this thread.

What's more (just some useless information): I have yet to see a trading platform where even the ASI ("Accumulative Swing Index") is coded and calculated correctly as per the book. One VERY fine example is the one supplied as standard with MetaTrader!!! Can you believe that!!! I've also seen some rather interesting (and incorrect) variations of RSI, ADX, and Parabolic SAR and then people wonder why they cannot make money using Wilder's trading systems!!!

I have my own forums that are pretty much dedicated to Wilder's trading systems and how I trade and there are some examples on the forums that are publicly viewable. My forums are at techtradercentral.net.

I hope this helps.

Regards,

Dale Paterson.

By the way: I've attached a daily chart of the Spanish IBEX35 showing a CORRECTLY calculated ASI (the blue line) and the Trailing INDEX SAR (the green and red dots). It's the first "indicator" on the lower portion of the chart.

In case anybody is wondering why I'm using quote marks when referring to the Swing Index System "indicator": it's not REALLY an indicator in the true sense of the word i.e. the Swing Index System is based on price and price alone and there are no lagging components etc. such as moving averages or average calculations or anything like that. That's why I hesitate to call it an indicator!!!

Thanx in advance!!! This was very helpful to me... i will post here the algorithm which is developed by me..plz show me logical errors if exists...Thanx again!!!

My attempt to develop the algorithm using Java......

public double CalculateSwingIndex(double today_Open, double today_Close, double today_High, double today_Low, double Yesteday_Open, double Yesteday_Close, double Yesteday_High, double Yesteday_Low)
{

double indx = 0.0;
double ret = 0.0;

double R = R_val(today_High, today_Low, today_Close, Yesteday_Open, Yesteday_Close,Yesteday_High, Yesteday_Low);
http://Log.i("R value Function:", Double.toString(R));

//double K = K_val(Yesteday_Open,Yesteday_Close,today_High,today_Low);
http://Log.i("K value Function:", Double.toString(K));

//********** OLD Equation ***********
//indx = ((Yesteday_Close - today_Close) + 0.5*(Yesteday_Close - Yesteday_Open) + 0.25*(today_Close - today_Open)) / R ;

// ******* This is New Method *******
indx = ((today_Close - Yesteday_Close ) + 0.5*(today_Close - today_Open) + 0.25*(Yesteday_Close - Yesteday_Open)) / R ;
http://Log.i("indx value", Double.toString(indx));

ret = indx * 50;
http://Log.i("final Value", Double.toString(ret));




//indx = (50.0*(( (Yesteday_Close - today_Close)+0.5*(Yesteday_Close-Yesteday_Open)+0.25*(today_Close - today_Open) )/R_val( today_High, today_Close, Yesteday_Open, Yesteday_Close, Yesteday_High, Yesteday_Low)))*(K_val(Yesteday_Open,Yesteday_Close,Yesteday_High,Yesteday_Low));

//return indx;



return ret;
}


public double R_val(double today_High, double today_Low, double today_Close, double Yesteday_Open, double Yesteday_Close, double Yesteday_High, double Yesteday_Low)
{
double val1 = today_High - Yesteday_Close;
double val2 = today_Low - Yesteday_Close;
double val3 = today_High - today_Close;

/*Log.i("value of val1 :", Double.toString(val1));
Log.i("value of val2 :", Double.toString(val2));
Log.i("value of val3 :", Double.toString(val3));*/

double rtn_value=0.0;

if(val1 > val2)
{
if(val1 > val3)
{
rtn_value = ((val1)+0.5*(val2)+0.25*(Yesteday_Close + Yesteday_Open));
http://Log.i("Return value of val1 R :", Double.toString(rtn_value));
}

else if(val3 > val2)
{
rtn_value = (val3 + 0.25*(Yesteday_Close + Yesteday_Open));
http://Log.i("values of val3 :", Double.toString(val3));
}
}
else if(val2 > val3 )
{
rtn_value = ((val2)+0.5*(val1)+0.25*(Yesteday_Close + Yesteday_Open));
http://Log.i("values of val2 :", Double.toString(val2));
}
return rtn_value;
}