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AstroindicatorsinTimingSolution

AstroindicatorsinTimingSolution
2007SergeyTarassov
Introduction
Themostcommonmistake
Technologydescriptionanalysis
Technologydescriptionsynthesis
Howtocreateanindicatortorevealturningpoints

Introduction
WithTimingSolution,itispossibletocalculateanyofthemostpopularastroindicators.Now
(September2007)thereare17variantsofdifferentastroindicators.Youwillfindamongthemthe
indicatorswellknownanddescribedindifferentopensources(suchasBarco,Ganue,andHoff
indicatorsandtheirvariations)aswellastheindicatorscreatedbymeaccordingtosuggestionsofthe
softwareusers.InthisarticleIwilldoabriefoverviewoftheseindicatorsandshowhowtocustomize
themforanyfinancialinstrument.Mygoalwastoanalyzehowtheseindicatorsforecasttheturning
pointsandvolatility.TheDowJonesIndustrialindexdatafrom1885toAugust2007wereused.To
analyzevolatility,Iusedthedatafromtheyear1980.Theorbforanythingplanetaryrelatedinthis
researchis2degrees.
Letusstartwiththedescriptionoftheseindicators.
1.PlanetaryPicturesGeo(0..180)scale.Tocalculatethisindex,theprogramtakesallangles
betweentheplanetsingeocentricusing0..180degreesscale.Thisindexshowshowmany
planetarypairshavethesameangleseparation.Ididnotfindanycorrelationandpriceforthis
index.ItdoesnotworkforDJI.
2.PlanetaryPicturesHelio(0..180)scale..Itiscalculatedthesamewayasthepreviousindicator,
theonlydifferenceistheuseofheliocentricplanetarypositions.Itshowssomeimpacton
volatility,especiallywhenthevalueofthisindicatorissmall(lessthan10).
3.PlanetaryPicturesGeo(0..360)scale.Itcalculatestheanglebetweenplanetsusing0...360
degreesscale.Itshowshowmanyplanetarypairshavethesameangleseparation(0..360
degreesscale).Noeffectfound.
4.PlanetaryPicturesHelio(0..360)scale.Itworkssimilarto#2indicator
5.Sumofangleseparation(180...+180)Geo.Itcalculatesthesumforallanglesbetweenthe
planets.Theprogramassignsapositivevaluetothefrontposition,whilethebackpositionhasa
negativevalue.Noeffectfound.
6.Sumofangleseparation(180...+180)Helio.Thisindicatordefinitelycorrelatestothetop
turningpoints.Whenthevalueofthisindicatorfallsinto400to+400range,theprobabilityof
atopturningpointishigh.
7.Sumofabsoluteseparation0..180degreesscaleGeo.Itcalculatesthesumoftheangles
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betweenplanetsusing0..180scale,backandfrontpositionshavethesamevalue.Thevaluein
therange500..1000isrelatedtoabottomturningpoint.
8.Sumofabsoluteseparation0..180degreesscaleHelio.Thevalueintherange150..+300is
relatedtothetopturningpoint.
9.Sumofabsoluteseparation0..360degreesscaleGeo.Noeffectfound.
10.Sumofabsoluteseparation0..360degreesscaleHelio.Noeffectfound.
11.AmountofmidpointconjunctionsGeo.Tocalculatethisindicator,theprogramtakesall
midpointsbetweentheplanetsandcountstheamountofmidpointsthathavethesame
longitude.Thevaluebetween+55and+120isrelatedtothetopturningpoint.
12.AmountofmidpointconjunctionsHelio.Noeffectfound.
13.AmountofmidpointoppositionsGeo.Thevaluebetween0..+10isrelatedtothebottom
turningpoint.
14.AmountofmidpointoppositionsHelio.Noeffectfound.
15.IndexofcyclicalvariationsGeo.Itcalculatestheamountofwaxinganglesminustheamount
ofwaningangles.Itisastrongindicator.Thevaluebetween+20and+35isrelatedtothetop
turningpoints,whilethevalue9..21isrelatedtothebottom.
Alsosometimesthisindexcorrelateswiththetrend:

16.IndexofcyclicalvariationsHelio.Itmayforecastbottomturningpointwhenitsvalueisinthe
range8..16.
17.Hoffindex.Thenegativevalueofthisindexcorrelatesverywellwiththetrend.
Ihaveaddedseveralnewmodelstotheprogrambasedonthisresearch.TimingSolutionuserswill
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findthesenewULEmodelsintheupgradeofSeptember12,2007.Hereisthelist:
1)Amodeltoforecasttopturningpoints.
2)Amodeltoforecastbottomturningpoints.
3)Trendindexbasedon"IndexofcyclicalvariationsGeo"
4)TrendindexbasedonHoffindex.
Youcanrunthesemodelshere:

Rememberthatyoucanusetheseindicatorsashintsonly.

Themostcommonmistake
Beforeanydiscussion,Iwouldliketotalkaboutaverycommonmistakethattakesplacewhen
somebodyapplies/inventsanyastroindicator.
Letusconsiderplanetarypicturesheliocentricindicators(Whatfollowsbelow,canbeappliedtoany
indicator).Thisindicatorsimplyshowstheamountofplanetarypairsinheliocentricsystemthathave
thesameangleseparation.
Thereisnomistakeyet.Itcomeslater.
Ifmygoalwouldbetosellyouthisindicator,Iwouldstartanadvertisingcampaignwithsomething
likethis:"Lookatthepricechartandtheindicatordisplayedtogether:

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Youseethatthebigvaluesofthisindicator(seetheredcurveatthebottom)correspondtothemajor
turningpointsonthepricechart".
Thereisstillnomistake.ThecalculationisOKforthechosentimeinterval,andtheconclusionisOK.
Youmaybeimpressedandbuythisindicator.AnditisnotOKwhenyouapplyitforyourtrading.
Doesitsoundsfamiliar?Ihaveseenitsomanytimesinthelettersfrommyusers.Whatiswrong?
Whereisthemistake?
Itisthere.Iwouldcallitmisrepresentation(maybe,unwillingorunintended).
Ifthepictureaboveistheonlypieceofinformationregardingthisindicator,wearenotactuallyable
tofigureouthowthisindicatorwillperform.Seeyourself.
Letustakenexttwoconsequentintervalsthatfollowthepictureshownabove.Herearethepricechart
andthatsameindicatortogether,thoughwithoutanyselection:

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CouldyoupleasemakethesameconclusionregardingtheindicatorandthepriceturningpointNOW?
Idonotseeanyconnectionbetweenthepriceandtheanalyzedindicator.
Icouldeasilydothesamethingforvolatilityoranyotherindextakingjustonegoodexampleand
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makingaconclusionthat"thehighvalueofourastroindicatortendstoincrease/decreasevolatility(or
whateverweresearch)".Choosingtheappropriatetimespan,wecanapprove/disapproveanything.
Tounderstandhowanyastroindicator(oranyindicator)works,itisnecessarytoanalyzemany
subsequentintervalswithoutanyselection.
Thedetailedstatisticalanalysisshowsthatoftentheseindicatorsworktotallydifferentfromwhatwe
areexpectingfromthem.Forexampleifwemodifytheabovementionedindicatorusingthe
geocentricsystem(notheliocentric),wewillfindthatitshighvaluetendstoappeartogetherwith
TOPturningpoints,notbottoms.Thusthehighvalueofthisindicatorcanserveasasign(withsome
probability,ofcourse)fortheupcomingTOPturningpoint.
InthisarticleIwillshowyouhowtoanalyzeandcreatetheastroindicatorusingTimingSolution
software.

Technologydescriptionanalysis
InTimingSolutionyoucancreatepracticallyanyknownastroindicator.Lookat"AstroIndicators"
tab.Youwillfindthere17themostusedindicatorsincludingGanue,Barbo,Hoffindicatorsandthe
indicatorsbasedonPlanetaryPictures,calculatedforGeoandHeliosystems.

Youmaydisplayanyorseveralindicatorstogetherwiththepricechart:

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Letusperformthestatisticalanalysisforanyoftheseindicators.Ourgoalistogettheobjective
pictureofhowthisindicatoractuallyworks.Letusanalyze"Indexofcyclicalvariation":

Thisindicatorshowsabalanceofwaxingandwaninganglesbetweentheplanetsingeocentric
system.Clickthisbutton:

toopenthestatisticalmodule.Youwillgetthescattereddiagram:

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OnXaxistheprogramshowsthevalueof"Indexofcyclicalvariation"forallpricebars,whileYaxis
showstheappropriatevalueofVolatilityindex.Actuallyyoucananalyzeanyindexhere(ItriedRSI,
ADXandother):

IhaveanalyzedDowJonesIndustrialindexusingthedatafromtheyear1980to2007.Theprogram
drawsmorethan7000pointsonthisdiagram.Forusthemostinterestingthingistheexistenceofthe
redregions.Youcanseeonthediagramtworedclustersthatprovideusavaluableinformation
regardingtheeffectthatthisindexhasonvolatility.
ClusterN1showswhathappenswhenthisindexishigh.Ifourastroindicatorishigherthan7(which
meansthattherearemorewaxinganglesbetweentheplanetsthanwaningones),thevolatilityishigh
enough:0.530.7%.Wecanacceptthisfactasastatisticallyverifiedonethebigamountofwaxing
anglesbetweentheplanetsleadstothehighvolatilityoftheDowJonesIndex.
Youcanseetherethesecondcluster.Itcorrespondstothenegativevalueofthisindex,anditshows
thesmallvaluesofvolatility,nomorethan0.34%.Inotherwords,whentherearemorewaningangles
betweentheplanets,thevolatilityislow.
Youcanplaywiththestatisticalparameters(especiallywithChiSquareandMinamountofpointsin
thebin):
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Itallowsyoutounderstandwhatclustersarethestrongestones.

Technologydescriptionsynthesis
Nowwehaveatoolthatallowsuseasilyfindouthowanyastroindicatoraffectsthestockmarket.
Lookatthetablebelow.ThereIputtheresultsofmyanalysisof10differentindicators.These10
indicatorsarethemostinfluentialforvolatility.Thevaluestherearethevaluesoftheindicatorthat
correspondtohigh/lowvolatility:
Indicator
L1=Sumofangleseparation
(180..+180)Geo
L2=Sumofangleseparation
(180..+180)Helio
L3=SumofABSOLUTEangle
separation(0..+180)Helio
L4=Sumofangleseparation
0...360Geo
L5=Amountmidpoints
conjunctionsHelio
L6=Amountmidpoints
oppositionGeo
L7=Amountmidpoints
oppositionHelio
L8=IndexofCyclicalvariation
Geo
L9=IndexofCyclicalvariation
Helio
L10=HoffZodiacalIndex

VolatilityHigh

VolatilityLow

+800..+4000

600..4000

+600...+1500

300...1300

+600...+1000

1000...2000

+800...+2300

800...2300

0...+30

+30...+60
+20...+30

+10...+20
+7...+40

7..21

+4...+15
+2..+42

HowdidIgetthisinformation?Forexample,thefirstlineofthistableisreceivedfromthisdiagram:

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Thesevaluesforall10indicatorsarestatisticallyverified.Therefore,Icantakeeachoneofthemas
themeaningfuleventandaddthemtotheULEmoduleoftheprogram(ULEstandsforUniversal
LanguageofEvents,Iincludetherethingsthatplaysomeroleforthestockmarket):

Nowletuscreatethefinalformulathatsummarizesournewlyfoundknowledgeabouttheseindexes
(indicators).
Considerthefirstline:
L1=Sumofangleseparation
(180..+180)Geo

+800..+4000 600..4000

Themessagethatwegethereissimple:DJIisvolatilewhenthefirstindicatorisintherangebetween
(800,4000)and(600,4000).Volatilitygrowswhentheindicatoriscloserto(800,4000)it
decreaseswhentheindicatorisnegative(600,4000).
Letuswritethisconditiontogether:L1thisistheanalyzedindicator.Towrite"Volatilityishigh
whentheindicatorbetween800and4000",usethisexpression:Range(L1,800,4000).
Nextweneedtowritethis:"Volatilityislowwhentheindicatorisbetween600and4000".Dothe
subtraction:
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Thenperformthesameprocedureforthenextindicator:
L2=Sumofangleseparation
+600...+1500
(180..+180)Helio

300...
1300

Addittothefirstone.
Finallyyouwillgettheformulathatinvolvesallanalyzedterms.Seehowthisindicatorlooks(red
ourindicator,blueactualvolatility):

Ofcourseitisnotanideal,Iwouldnotrecommendittoyouasyourmajortradingtool.However,its
qualityisalotbetterthanthatofanyindicatorbyitself.
Whileyouareworkingwiththiscomplicatedformula,IrecommendtosetthisoptionOFFtohideall
termsthatourindicatorconsistsof:

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Howtocreateanindicatortorevealturningpoints
Thetechnologyisexactlythesameasabove.TheonlydifferenceisthatinsteadofVolatilityindexin
thescattereddiagramuseadetrendedzigzagindex:

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Herethetoppartofdiagramcorrespondstothetopturningpoints,thebottomtothebottomturning
points.Thustheupperredclustercanbeinterpretedasthis:whentheanalyzedindexisintherange
300to+500,theupturningpointismoreprobable.

2007TimingSolution
September12,2007
Toronto,Canada

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