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Carol Alexander - market Contents list of illustrations Computerized trading An introduction The disciplined trader - developing Wiley trading seriesbeyond By wiluam MC'laren Trade your way The Theory of Interest Publications in operations Introduction to Econometrics Methods of Wall-Street Master First editionwith 140 This book was Icroeconomicprinciplespaul templea buffer The gann pyramtosquare The harmonic traderby Also by david The profit magic The symmetry wave

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63

LSE, FREQUENCY VS TIME ANALYSIS




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0 20 40 eO eO 0 120 140 160 0 200 220 240 260 280 300

WEEKS

Smoothing Filtered Outputs

I2i It 10 j 9

LOW FREQUENCY LINE SPECTRUM DOW-JONES INDUSTRIAL AVERAGE

» FOURIER ANALYSIS

DIGITAL FILTER ANALYSIS

FIGURE AI-7

2 4 e 8 10 12 14 le 18 20 22 24 26 28 30 32 34

Best Estimate Of Line-Spacing

THE LINE SPECTRAL MODEL

We can now use the presumed minimum regular spacing of spectral lines to estabhsh a nominal spectral model of considerably more character than the one described in Chapter Two. The assumption of regularly spaced lines (.3676 radians per year separation) leads to the spectral groupings of Figure A 1-8.

The horizontal lines on the chart are taken directly from the low ampUtude dividing points of the coarse structure of the Fourier analysis. Results are completely in line with expectations from graphical, observational, and filter analysis.

The coarse structure to be implied from this model takes the form of a central group of spectral lines which behave like a "carrier" frequency in communications. Each of these has sets of fine structure lines which behave as amplitude modulation side bands. Some of the modulation side bands are also amplitude modulated (have side bands of their own), resulting in frequency modulation of the composite coarse structure wave form. As demonstrated repeatedly m the body of the book, this is

					T, NOM.
	.3676	17.1			18.0 Y
	.715				9.0
	1.1028 1.170		...........68:5 51.3		4.3 Y
	1.8380 2.2056 2.5732		fl.l 34.2 29.4		3.0 Y
8. 9. 10.	2.908 3.308 3.6760 4,0436 4.4112	2.1 1.9 1.72 1.60 1.43	25.7 22,8 20.6 18.7 17.1		18.0 M
15. i6. 17. 18. 19.	4.7788 5.1464 5.51*0 5.8816 6.2492 6.6168 6.9844	1.32 1.22	15.8 14.6 13.7 12.8 12,1 11.4 10.8		12.0
20, 21. 22. 11: 11:	7.3520 7.7196 8.0872 8.4548 8.8224 9.1900 9.5576		10.3 9.8 9.35 8.95 8.57 8.22 7.80		9.0 M
27. 28. 29. 30. 31. 32. 33. 3.	9.9252 10.2928 10.6604 11.0280 11.3956 11.7632 12.1308 12.4984		7.63 7.33 7.10 6.85 6.65 6.42 6,22 6.06	29.6 28.8 27.8 27.0 26.2	6.0 M

FIGURE A1-8

Low-Frequency Portion: Spectral Model

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