Thread: Choppy market index: any good ideas?

Hi all. I'm sure you looked at the image above. Undoubtedly you instantly made a very clear differentiation between the left side and the right side. On the left that the market is falling like a stone on the right that the price is jumping all over the region: choppy.

There have been several attempts here in FF and at other places to build a choppiness index indior. I discovered no successful results. I wonder if someone has great ideas about constructing an algorithm that is able to measure how large the market is. The inspiration for not simply using my naked eyes would be that I'd like to display all the major currencies (28 pairs) on 3 TF. That is 84 charts to track 24x5.

Choppiness is usually measured with the ADX indior. The ADX is designed to assess the strenght of the trend. The image below shows that a trend can also be choppy. The trendiness and the choppiness are clearly two independent things. ADX is hence not in any way that an indior of the choppiness of the market. Each of the indiors or formula I could detect make the mistake of considering choppy = ranging.


Some people suggested the use of range pubs or renko pubs to take out the choppiness altogether. No choppiness = no demand for an indi. Brilliant idea but look at the range chart below: continuous range bar charts, at any given range, can also be choppy!


The longer the market is volatile the longer it's choppy. The volatility is measured by ATR. Too bad we just found that range bar chart can also be choppy yet the ATR is continuous on them. Conclusion: ATR is not any good either.

I tried to scroll down a chart bar by bar to see what I would consider a choppy market. I takes me 3-5 pubs to notice a change between choppy/non-choppy. Sometimes I just couldn't decide! So I can't expect a crisp YES/NO indior a degree of choppiness. I can also expect up to five bars of lag (! ) ) .

Drawing a line in the finish of the pub to the close five bars until you do this: choppy markets look like a webcob and stable markets form a thin ribbon. Perhaps there is something to dig in this way...

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quote and patience with no slope very important.

Confidence can also be significant. Whether the transaction ends up getting stopped out or hitting target, confidence can help to stick to the plan.

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I adore choppy (which range ) market...

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THe slope of MAis a fantastic indior for Choppy MArkets

Originally Posted by ;

quote and patience without any slope quite important.

Choppy #8800; ranging market
Please read post #38 again

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All I must do is wait till it breaks down a side then plan a trade heading in that way...

The goal is not to avoid ranging market but to potentially trade inside or utilize the knowledge of its contour to but/sell in the border with tiny SL.
Please read post #54 again

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Yes I'm still interested in a quantitative estimator of choppiness. Perhaps also in finding a much better word for this because people always associate choppy and ranging market as being the same thing. I make a very clear distinction between both of these aspects of this PA.. A ranging market could be steady while a trend could be choppy. Admittedly the examples are far from ideal but they might give a notion. picture

It's very good to develop standards for the language so we can start using the right terms. Have you got other posts with other ambiguous vocabulary which you have better described? Maybe there's a way to arrange that information but, I'm sure it would be very time consuming...

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quote quote quote choppy #8800; ranging market please read article #38 again quote The goal is not to prevent ranging market but also to possibly trade inside or utilize the understanding of its shape to but/sell at the border with tiny SL. Please read post #54 again

I am not agree.... Choppy tranding markets are the same, possibly the only difference is that the amplitude of time and moving duration

Originally Posted by ;

quote quote quote choppy #8800; ranging market please read article #38 again quote The objective isn't to prevent ranging market but also to possibly trade inside or use the understanding of its form to but/sell in the border with miniature SL. Please see post #54 again

This is something that you might be curiosity about. I didn't develop this for the purpose of finding choppy markets, but instead to pinpoint fast-markets.

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quote Here is something you might be curiosity about. I didn't grow this to the purpose of finding choppy markets, but instead to pinpoint fast-markets.

Thank you for that Fast Markets Indior, I'll place it onto a chart this week and I'm sure it is going to help someone with their egy. I figured out something interesting yesterday that will take precision to some greater degree. Currently in order of correctness I exchange constant range, choppy fashion, choppy range, and the bewildering one might be the continuous trend. That steady trend got me stopped out on GBPJPY, EURJPY last week but I made it right with another attempt. This is the reason why forex is great, it's a never ending learning experience.

Originally Posted by ;

quote Thanks for that Fast Markets Indior, I will put it on a chart this week and I am sure it is going to help someone with their egy. I figured out something interesting yesterday that will take accuracy to a greater degree. Currently in order of correctness I exchange constant range, choppy trend, choppy range, and the bewildering one might be the continuous trend. That steady trend got me stopped out on GBPJPY, EURJPY last week but I made it directly with another attempt. This is the reason why forex is fantastic, it's a never ending learning experience.

I was watching the dollar strengthen across the board in response to the news about congress passing the budget for taxation reform, and that's where I got the idea to produce the Fast Markets indior. There is a lot of unknowns in forex however when spreads and volume spike across the plank on the majors (particularly on a non-planned-release fundamental event) you better not be on the wrong side of the because price isn't coming back anytime soon. Conversely, when spreads and volume return to under 100% of their various MAs then you can count on a few thicken.

Hello all,
I've taken much interest in this ribbon for many reasons. The main reason is the usage of differentiating the choppy market. The reality is almost all my orders occur when the market is FLAT or Choppy about the lower tf. That of course could mean if you're looking at a choppy market on the D1 it might be a massive breakout on the lower tf. When I get home I will make certain to discuss a few formations that you all!

Originally Posted by ;

quote It is good to develop standards for the language so we can begin using the correct terms. Have you got other articles with other ambiguous terminology that you have better described? Maybe there's a way to arrange that information but, I am sure it'd be quite time consuming...

Trading planet has got terms such as trend or volatility that are ambiguous. For trend everybody has his own definition but everybody entire agree on exactly what it is. Volatility is worse. For many people it means that the market moves strongly. For others (like me) it means the standard deviation of the price yields. These are just opposite definitions!

alphaomega talked about Surface roughness. He made me understand that Roughness Measure is perhaps a better language.
I am not myself sure of what exactly I am trying to quote. I guess it is the white noise part of the price. I posted some pictures to help understanding articles #13, #32, #38, #43, #51.

Something I am sure of is that it is independent of the management of the market since it is found in both trending and such periods.

Originally Posted by ;

quote Here is something you may be interest in. I didn't develop this for the purpose of locating choppy markets, but instead to pinpoint fast-markets.

That isn't what I am searching for but it is a really interesting subject too. I subscribed to your thread.