Square Scaling

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sbank
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Square Scaling

Post by sbank » Mon Jan 07, 2019 7:30 pm

Hi All,

Happy New Year. Hopefully you all will find wealth and prosperity this new year.

I have been watching some of Earik's older videos where he is using some geometric shapes. Most (all?) of this relies on the charts to be scaled appropriately. How does one do this? Or is it just trial an error? I see in the videos where Earik is trading the /es. I have started to trade the /nq as well. So I was trying to figure out how to get a proper square scaling.

I was hoping that some of you have some steps on what you do when approaching a new market.

thanks!

gezza
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Re: Square Scaling

Post by gezza » Wed Jan 09, 2019 4:40 am

Hi sbank

My experience tells me that generally speaking, getting a useful scale is based on reverse engineering ie find a scale that makes a technique work.

For example, say you wish to use a square shape - adjust the scale so that the first square works as you'd like it to, and then use that scale for the later squares.

Some techniques require a different scale for each tool rendition, but at the end of the day, you have to determine how much work you wish to perform for your chosen tool to do its intended job.

Regards
Gezza

sbank
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Re: Square Scaling

Post by sbank » Thu Jan 10, 2019 1:55 pm

Thanks. I think Earik alluded to that at some point in some reading or video.

I was hoping there was something more than trial and error. Like, "measure, this, take the sqrt root, multiply by the hypeneuse, stand on your left leg while looking at the ephemeris and take the third aspect, and the answer is 0.32."

I'll play around a bit I guess. :) thanks for the response. :)

abacaba
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Re: Square Scaling

Post by abacaba » Sat Jan 12, 2019 10:45 pm

I can't imagine trading without geometry.

The deep concept is scale invariance under modular transformation. The reason certain figures work on a scaled chart is that they illustrate by either subdivision or extension the figures formed by the scale invariant power laws that underlie market expansion and contraction. It's certainly possible to design a trendline angle or shape to articulate your favorite ratio with a fixed scale factor. But things are much more versatile when there is an alignment between chart scaling and the structure of the drawing object you are using.

For instance, given a square of constant size, the 45 degree angle (Gann angle 1x1), maps as follows:

.125*1==>1x1
.125*2==>1x2
.125*4==>1x4
(...)

One lesson from this simple example is that the 45 degree and all other angles are entirely relative. A single drawing object should work with different scaling factors as long as you understand how the information is visually presented in each case. Try working through other scaling factors as well to see what that does.

Hope that helps.

Todd

sbank
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Re: Square Scaling

Post by sbank » Mon Jan 14, 2019 2:12 pm

Thanks Todd. That was very informative.

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earik
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Re: Square Scaling

Post by earik » Mon Jan 14, 2019 6:31 pm

Hi sbank,

There's a video on scaling in the member area. Go to wave59.com - member login - instructional videos, and you'll find it there. If you haven't seen that yet, definitely check it out. A big part of it is how to go about finding a scale and verifying that it is a useful one for your market.

Generally speaking, the scales all make some sort of numerical sense. Although there are exceptions, I'd just focus on nice, roundish numbers. In Todd's example, his base scale factor is 1/8th (0.125). He's not using 1.286797 or 2.34343, or some weird numbers. Just keep it nice and easy. Eighths are good, tenths are good, etc. There aren't nearly as many possibilities as you might think, so finding a useful scale is actually not super complicated once you get the gist of it. Stick with points-per-bar, and it should be pretty easy to come up with something useful for the NQ. :)

Earik

sbank
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Re: Square Scaling

Post by sbank » Tue Jan 15, 2019 1:35 pm

But I like weird numbers!!! :)

In all seriousness, what I ended up doing was writing a QScript that would draw 45° Gann lines. Then used the brute force optimizer to step through and increment the ratios until I found something that "works." But I will go back a watch that video. thanks!

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