A Chebyshev trend is a polynomial trend line created using a modified Gaussian least squares fit. This method essentially acts as a noise filter, removing random fluctuations from the chart data, displaying the real underlying trend. The main benefit of using this trending method is an almost complete absence of lag, when compared to moving average trends.
In this application the Chebyshev trend line is used to analyze historical financial data, for example stock and currency prices. The trend line can be customized based on the number of days of prices to be analyzed (currently set to 100) and the polynomial order, or degree of fit, (currently set to 10) of the trend line to the stock prices. Potential buy and sell signals are generated by changes in the trend’s direction. The higher the polynomial order the more accurately the trend line will fit the historical data. The lower the polynomial order the less accurately trend line will fit the historical data. For example, a 2nd order polynomial will show a straight line trend and a 4th order polynomial will show a Supersignal channel.
A Supersignal is an enhancement to a Chebyshev trend line that attempts to more accurately identify a trading opportunity.
The aim of this site is to assist in identifying the most likely trading opportunities using Supersignals.
The key is to use only those signals that are paralleled to the symbol price and touching the lower order channels in the direction of the channel’s trend only, for example:
In addition traders should only trade the signals that are in the direction of the last signal in the higher frame, for example:
- Long position = channels are trending up + price near channel's bottom line + Chebyshev buy signal
- Short position = channels are trending down + price near channel's upper line + Chebyshev sell signal.
Options for traders to exit a trade include:
- if in the weekly trend the last signal is long, take all long signals on daily frame and avoid all short signals
- if in the weekly trend the last signal is short, take all short signals on daily frame and avoid all long signals.
Currently two options are available to identify potential trading opportunities:
- on the last opposite signal if the price starts to oscillate
- or on next opposite signal
- or if the price is near the channel lines and the trend direction not too strong.
1. By Symbol(s)
Entering individual financial symbols in Yahoo finance format, for example MSFT or ^DJI, separated by spaces.
2. By Market Scan
A market scan can be initiated based on user selectable criteria, for example the exchange, market capitalization, average price in range, price variation in range, signal direction and type of symbols. For any financial symbols matching the selected market scan criteria their corresponding summary charts and comments about possible trading strategies will be displayed.
So the easiest way to use the site is to simply enter your symbol(s) of interest into the text edit field of "By Symbol(s)" form on the first page of the site:
The autocompletion works for the first entered symbol only. Enter blank devided multiple symbols if you know their Yahoo Finance abbreviation.
You can get daily trend lines and associated signals now. They could be compared with weekly trends and signals:
Let's check what the charts show and what comments mean:
- Black curve is a regular trend line. The last 2 points of direction change are marked with signal triangles. If global trend near horisontal line and black curve looks like periodic oscillation, it's possible to use the last signal as entry and previous signal level as possible exit.
But how to find what global trend we have and how significant signals are?
For those purposes the supersignal was invented.
It consists of more common trend line and 2 parallel lines in std deviation distance from that line. All they operate like a channel. And There is how they should be used by method inventor Alon Hadar:
The last tip is:
- the key is to use only the signals that are paralleled to price touching lower order channels
in the direction of the channels trend only
- long = channels are up + price near channel's bottom + chebyshev signal buy
- short = channels are heading down + price near channel's upper line + chebychev signal sell
Also Marcello Djunaidy offers to use Supersignal as an envelope for overbought/oversold indication: buy when below envelope, sell when above envelope
- Traders should trade only the signals that are in the direction of the last signal in the higher frame meaning -
- if in weekly frame last signal is long they should take all long signals on daily frame and avoid all short signals;
- if in weekly frame last signal is short they should take all short signals on daily frame and avoid all long signals.
The system tries to use these tips to give some automated recomendations, namely, to find a supersignal if both regular trend line changes direction and global trend line move in the same direction.
And find signal's strength by the most recent regular trend value comparison against channel lines.
Plus some recomendations are given based on daily and weekly trend lines comparison.
The disadvantages of the easy way are:
So if you are interested to try all these exciting features, register please:
- you can't use the main feature of the web service - Market scanning to find winning symbols;
- you can examine only symbols you know;
- your symbols of interest aren't kept anywhere for further use;
- you don't receive email daily alerts about most recent supersignals;
- you don't receive email daily analysis of your symbos of interest.
You'll need to enter only minimum information required for you latter autentification and emailing:
After registration you should receive confirmation letter and when you'll go the provided link, here you are!
After succesfull login your first screen will be changed:
Now you have 2 possibilities:
I recommend to start from User Area:
- Go to the User Area;
- Use Market Scanner.
to create some groups for symbols of interest.
Now you can enter into the group and add symbols by the usual way:
or return to Home page and start Market scanning.
You can do it through all the particular exchange or add some filters:
And there are corresponding sort criterias at the bottom.
- Average price (sum of close for the last 100 bars / 100);
- Price variation (highest - lowest on 100 bars);
These factors are added to prevent investor to buy an already high stock or one that has little volatility and trades in a narrow range.
- Bars back (Scan depth in bars);
- Signal direction (Buy or Sell);
- Symbols type: (ETF, Future, Index, Mutual, Fund or Stock);
- In comparison with weekly trend (information) or in the same direction as a weekly trend (filter).
After Exchange button pressing symbols list should be shown:
You can select most suitable symbol by parameters and purchase recomendations and check it more in-depth pressing Lens icon.
If you'll find it interesting for further watch, you could add it to the suitable group using icon with spreadsheet and plus sign on it (green marked):
Now, let's return to User Area and enter into the Preferences:
You can decide to watch for your symbols of interests via emailing there by turn on "Email groups daily analysis" switch.
Or/And to select exchanges of interest to watch for them.
Emails should be sent to the e-mail address you provided during registration.
After 30 days trial period you can continue to use the service for 10 USD monthly or 80 USD annual.
That's all to the moment!
Hope you'll find the service more than usefull.
I continue development so your suggestions is highly eligeble.