Risk Disclosure

Futures, foreign currency and options trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results. View full risk disclosure.

Dorschden Swing Volatility Solver

The Dorschden Swing Volatility solver calculates the distance between swing points (the distance from swing top price to swing bottom price) as a way to measure volatility.  Swing point prices are derived from the SiSwings Indicator, included with BloodHound.

Parameters

This section is common to all solvers.  A description can be found here.
This section is common to all solvers.  A description can be found here.

Output

False will use both up & down swing trends to calculate the average swing length.  This will set both Long & Short output to equal the average swing length.  True will separate the calculations.  An up swing trend will be used to calculate the Long output, and down trends to calculate the Short output.

Specify how the swing length (point range) is calculated over the past Number of Swings

Average
Uses the average swing length over the past Number of Swings to calculate the output value.

Minimum
Chooses the smallest swing over the past Number of Swings to calculate the output value.

Maximum
Chooses the largest swing over the past Number of Swings to calculate the output value.

Swing Parameters

Sets the number of swing points back to evaluate.

Sets the swing size of Dorschden’s Price Action Swing Trend. Higher numbers will create larger swings, decreasing the sensitivity to swing reversals, and lower numbers will create smaller, choppier swings, increasing the sensitivity.

Sets the number of swing points back to begin the evaluation.

 

Targets

Sets the minimum swing point range required for an initial output value.

Measurement
Sets the type of measurement to calculate the Max Value.  Possible measurements are Points, Ticks, Renko Bricks, & ATRs.

Sets the minimum swing point range required for an output value of 1.

Measurement
Sets the type of measurement to calculate the Max Value.  Possible measurements are Points, Ticks, Renko Bricks, & ATRs.

Video Tutorial

This video is from our weekly Workshop titled Solvers 12-13, on Sep 26th, 2012.
For more benefit please watch in full screen mode, as this video is recorded in HD.

Examples

Example 1A: The Basics

This demonstrates the basic function of the Dorschden Swing Volatility solver.  This Solver measures the length price moves from swing point to swing point to determine if there is enough price movement to trade with.  It can be used to detect range bound choppy market action.

  • Add the Dorschden Swing Volatility solver
  • Set Number of Swings to 1
  • Set Target Volatility to 30 Ticks

Note in these charts that the Long & Short Threshold in the Signal Properties are set to 0.99.  When price moves more than 30 ticks from the previous swing point an output of 1 is given.

Example 1B: The Basics

This demonstrates the basic function of the Dorschden Swing Volatility solver.  This time the Solver will be set to average 2 trend length together.  The average length must be equal or greater than 30 ticks for an output of 1 to occur.

  • Add the Dorschden Swing Volatility solver
  • Set Number of Swings to 2
  • Set Target Volatility to 30 Ticks

Note, in these charts the Long & Short Threshold parameters (under Signals) are set to 0.99.    When 2 trend lengths average more than 30 ticks an output of 1 is given.  For example:

  1. Swing A(15ticks) + swing B(35ticks) = 50 / 2 = 25 ticks average therefore no signal (BH output is less than 1).
  2. Swing B + C = 61 / 2 = 30.5 ticks average for an output of 1.   Swing D + E = 60 / 2 = 30 ticks average for an output of 1.