A new oscillator pair has been developed that uses physics-based calculations that enable the trader to determine trend start and end points as they happen. This oscillator pair when fully examined leads to new definitions and a new understanding of market movements that often eliminates the need for excessive directional price movement validation prior to entry.
The Surge and Velocity Oscillators are shown in the above figure below the daily price of bitcoin 1.87% . Surge is a plot of the derivative of price acceleration, of which is the 2nd derivative of price movements, and though it at first appears to move in step with price, upon further examination, it reveals the inner workings of the market and enables the trader to identify trend start and end points to maximize profitability on each trade.
The companion oscillator is a moving average of the first derivative of price movement, otherwise termed as "Velocity". This oscillator pinpoints within one or two bars after the trend start and end points allowing you to enter as soon as a new trend begins.
To understand why an acceleration plot is important, (and the surge indicator behaves very much like the acceleration plot) consider the action of driving your car on a daily basis. The only way to control your car's motion is by accelerating and decelerating via the accelerator pedal or the break pedal. If you feel forward acceleration, it means you know you will be increasing speed, and thus moving in that particular direction. As you brake you know you will be decreasing speed and eventually stop moving. But you must accelerate before you move, and so the acceleration is felt first, speed is increased, and then you finally reach your destination. In a likewise manner, acceleration is registered in market movements and appear before the price movement actually happens. This is exactly what a trader needs to know to be profitable in this business.
And yes it does work this same way in the financial markets (with a twist) because as a trend starts, more and more people begin to recognize the trend and want to get in on it. As the trend grows, more and more people will likely be selling into the trend, taking profits and slowing it down. All trends come to an endpoint where the number of buyers are exhausted and the number of sellers begin to take control to move it down, and likewise in down trends.
The problem with price movement alone is that it is difficult to see the underlying acceleration changes that cause the trends to eventually turn. Traders often resort to trend lines and levels to determine where a market goes. And this works! But the oscillator presented allows you to see the "accelerator pedal" and "brake pedal" of the markets giving you an inner view of its levers of control. Since you cannot actually "move the lever" yourself, you can see the lever move and act accordingly when it does. Thus your timing becomes in sync with the actual market turns.
In the next section we will go into how to read the Surge in order to determine trend start and end points.
The Surge and Velocity Oscillators are shown in the above figure below the daily price of bitcoin 1.87% . Surge is a plot of the derivative of price acceleration, of which is the 2nd derivative of price movements, and though it at first appears to move in step with price, upon further examination, it reveals the inner workings of the market and enables the trader to identify trend start and end points to maximize profitability on each trade.
The companion oscillator is a moving average of the first derivative of price movement, otherwise termed as "Velocity". This oscillator pinpoints within one or two bars after the trend start and end points allowing you to enter as soon as a new trend begins.
To understand why an acceleration plot is important, (and the surge indicator behaves very much like the acceleration plot) consider the action of driving your car on a daily basis. The only way to control your car's motion is by accelerating and decelerating via the accelerator pedal or the break pedal. If you feel forward acceleration, it means you know you will be increasing speed, and thus moving in that particular direction. As you brake you know you will be decreasing speed and eventually stop moving. But you must accelerate before you move, and so the acceleration is felt first, speed is increased, and then you finally reach your destination. In a likewise manner, acceleration is registered in market movements and appear before the price movement actually happens. This is exactly what a trader needs to know to be profitable in this business.
And yes it does work this same way in the financial markets (with a twist) because as a trend starts, more and more people begin to recognize the trend and want to get in on it. As the trend grows, more and more people will likely be selling into the trend, taking profits and slowing it down. All trends come to an endpoint where the number of buyers are exhausted and the number of sellers begin to take control to move it down, and likewise in down trends.
The problem with price movement alone is that it is difficult to see the underlying acceleration changes that cause the trends to eventually turn. Traders often resort to trend lines and levels to determine where a market goes. And this works! But the oscillator presented allows you to see the "accelerator pedal" and "brake pedal" of the markets giving you an inner view of its levers of control. Since you cannot actually "move the lever" yourself, you can see the lever move and act accordingly when it does. Thus your timing becomes in sync with the actual market turns.
In the next section we will go into how to read the Surge in order to determine trend start and end points.
