J
J
JackShcherbakov2018-08-29 15:01:00
Algebra
JackShcherbakov, 2018-08-29 15:01:00

How to understand this price density formula?

Hello!
I am reading a book and there is a formula in it that I cannot understand. The book deals with measuring price noise. There is a price density formula for this, which I can't figure out.
So here is a quote from the book:

If we take a 10-day chart of highs and lows and draw a box (rectangle) touching the highs and lows, the density will be the degree to which the box is filled.

Here is the formula:
price density = Σ (top i = t and bottom i = t-n+1) High i - Low i/Max(high of day n) - Min(low of day n)
Many thanks in advance to everyone who helps!

Answer the question

In order to leave comments, you need to log in

1 answer(s)
L
Lander, 2018-08-29
@usdglander

So from the quote everything is clear! Price density is the area of ​​the pattern UNDER the price change chart.

Didn't find what you were looking for?

Ask your question

Ask a Question

731 491 924 answers to any question