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civil_worker
May 3, 2022 10:15 AM

DXY simulation using MCS 

U.S. Dollar Currency IndexTVC

Description

Monte Carlo Simulation, also known as the Monte Carlo Method or a multiple probability simulation, is a mathematical technique, which is used to estimate the possible outcomes of an uncertain even. In simple words, mcs using random numbers to simulate events and under law of large number , the out come of prediction will similar to what happens in reality in theory.
The model using in this indicator is geometric Brownian motion , basic equation of GBM is Delta price=price(drift x dt + sigma x dW)
Drift is similar to 'trend' and W is a random variable,sigma is volatility of price.
It's interesting that how the simulated price touch those trend line or resistance/support.
Comments
civil_worker
this indicator was created by LonesomeTheBlue and it's in community script, but I think it's for study purpose only since it's unstable obviously
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