Efficiency test, Simple ULE, Risky strategy, Logic conditions, ULE information window, Personal aspects calendar, TS calendar, Tidal Force, ULE models library, Events Model Editor, Model's performance on certain amount of most recent trades, Looking for the best strategy, Turning points, Control groups, Samples of ULE events, Delete ULE chart Fundamentals Events
This module allows to create simple and more advanced models analyzing processes that occurs in time and researching the effect of these phenomena on the stock market. We have developed a special way to deal with different types of events ("different" means really different events - physical phenomena, astronomy phenomena, price events, etc.; the list is not limited).
In this module, we define and record events that may have some effect on the stock market performance. As soon as it is done, the program calculates the moments and/or time periods when these events take place - and shows them together with the price chart. Therefore, we deal in this module with two processes: one is the price movement of some financial instrument (and we would like to know what will happen to it), another is some other process, already known and documented (which means that we know what occurs next). Comparing these two processes, we can make some conclusions regarding future price movements. Some samples are: scheduled FRS announcements (we know ahead of time when they occur, and we know that it will have some effect on the markets; we may assume that there will be changes on the market around the date of the next announcement) or the Annual cycle (the Earth's full turn around the Sun; we know its phases and we know about seasonal component of the markets). Knowing special points/moments of one process and learning its effect on the market price moves in the past, we can assume the next market moves in regards to that process.
Originally, ULE was developed to test the effect of astro factors. Later other events were added to it. Timing Solution users work with this module a lot, it is one of the most popular modules of the software.
We believe that the best way to introduce main features of this module is going through some practical examples.
Example #1: retrograde indicator
Let us start with a very simple indicator. Suppose we have heard about some connection between the stock market and such thing as Mercury retrograde. ("We have heard" - it is not the same as "we know". Also, we do not specify here what is that connection. We just have heard that there may be some.) If it is true, it can be used to prepare for possible future market moves. So, our first step would be to create an indicator that shows the periods when Mercury is retrograde. It is very simple to do with Timing Solution. Click this button:
and fill out the form as it is shown below:
By filling this form, we have defined the ULE event, "Mercury is retrograde". This event is marked as L1 (Logic condition #1). Click "Calculate" button, and you will get the chart like this one:
These vertical stripes correspond to the time periods when Mercury is retrograde inside the time interval that we research.
We can stop here and work with just this one event. If you need to delete this ULE chart simply click one of these buttons:
Or we can go further - including other things into our consideration. Let say, we assume that not only retrograde Mercury affects our market, we think that retrograde Venus has also some part in it. So, we create one more event. "Venus is retrograde". We deal with the same form as above, though we fill it out differently (see the picture below). And, because it is one more event that we add to the previous one, we should click "+" button after filling the form:
Now we are able to consider two events, two logic conditions, L1 and L2, that we have for Mercury retrograde and Venus retrograde. If we would like to see these events on one screen, it is better to switch to ULE panel clicking this icon:
You can see how these two events work in time. (You can add here other events - as many as you like. Though we are able to see them all in one screen, it is just the price chart and pictures of different individual events. I would say that it is a first step in the analysis: looking at each event separately, we can quickly decide whether it has any relation to our price chart.)
Now it is time to create the more advanced indicator. Looking at the diagram above, we may decide that both events have some relation to the price ups and downs. And we may want to see the moments when MERCURY OR VENUS is retrograde, i.e. the moments when at least one planet (of these two) is retrograde. In a language of math logic, we are looking for a situation when at least one of the available logic conditions takes place.
In order to do that, type L1+L2 formula and click Calculate button once again. Here are these retrograde zones:
You may also do the opposite: create a model for the periods when BOTH MERCURY AND VENUS ARE RETROGRADE, i.e. double retrograde zones. This is very simple; type this formula L1*L2:
You should remember that L1+L2 means at least one of these events is active, while L2*L2 means that both these events are active. We use regular logical operators for these formulas.
Following the same logic, we can easily create triple or more complicated indicator. Just an example, this is an indicator that allows to find a very seldom event in history - the moments when Mercury, Venus and Mars are all retrograde:
Within 150 years, since 1885 till 2035, this phenomena (triple retrograde) took place three times only.
So, in brief, we take one event, consider it in regards to the changes in the price chart - and we can create an indicator/index based on this event. How? Just making necessary calculations and marking time periods or moments when this event takes place.
What does all that give to a trader? It is a first step in analysis. We record here a thing that may be affecting the market price. The next step would be checking this hypothesis against the market data. During this step, we will be able to find a nature of this effect (like there is a correlation, it is a positive correlation, it is a negative correlation (which gives us invertions), or there is no correlation at all). The third step will be use cases with the correlation and create a forecasting model on their base. All steps will be discussed later, in this and other articles.
"Retrogrades" are just one type of events that we can deal in ULE module. What are other events available there?
Example #2: Sun aspect index
Another popular group is "Aspects". There are many talks about aspects, their power and meaning. We deal with the core idea - aspects as angle distances between the planets. Based on past centuries evidence, some aspects are more distinguished than others. 0 (360), 30, 45, 60, 90, 120, and 180 (so called Ptolemy aspects) are considered as the most important ones. And there is a lot of things that you may want to explore regarding aspects. For example, you may decide to create "Sun aspects index"; it indicates the Ptolemy aspects made by the Sun to other planets. Again, we use a form of ULE module. Set these parameters and press "Calculate" button:
Immediately after the calculation, you will get this diagram (together with Dow Jones Industrial index chart):
This is Sun aspects index. Higher values on this diagram mean that more planets make aspects to the Sun and with tighter orb at those points in time.
If we take some other price chart instead of DJII's and repeat that same procedure, it will be Sun aspect index for some other financial instrument. (Then you can check how it really correlates to the chosen market; it is a way to create a lot of different astro indicators.)
BTW, through Main Window View you can modify this chart. Your choices are: displaying this index together with some price chart (as below) or in two different panels (as above). Also, you can change colors and the thickness of the lines:
You may consider aspects of other planets, not just the Sun, You may as well work with specific aspects between specific planets. And, as we did above, every new event that you record in this module can be combined with other events - creating the formula by means of logical operators.
We have looked at just two groups of astro events. Timing Solution provides more - just try all the tabs in this module. It is a very powerful tool. With it, you can check any statements regarding "secret" factors that may move the market - no matter how complicated they may sound. Do not be a believer; be an explorer!
ULE information module
Let us continue working with Sun aspects index. After calculating it, you may want to know what aspects are active in a certain moment of time. Though the celestial bodies forming some aspect are always in the sky, a certain aspect may or may not be present (or active) at a certain moment of time. In order to know that, follow these steps to run ULE information window:
Now when you make a mouse click somewhere on the price chart in the Main window, you will see there all aspects that are at work at that moment, with specific information about each one of them.
Example #3: Calendar of your personal aspects
There is one issue related to the aspects that you may want to know. It is aspects to your Natal chart. You may like to know what hits your personal chart, when and how. In other words, you may want to create your personal calendar of aspects.
Still in the same ULE module, fill out the form this way:
Here we use NATAL-TRANSIT aspects (in previous example we used TRANSIT-TRANSIT aspects). Also pay attention that we use here CULMINATIONS of the aspects.
After the calculation, you get the calendar similar to this one:
The program saves this calendar into the file, so next time you do not need to repeat these calculations. You simply have to run a very simple program, TS Calendar, and open that file.
Example #4: Tidal force index
Another issue related to aspects is Tidal force. It is among the most frequently asked questions, so we have decided to calculate the Moon tidal force and show it together with the price chart. If you like to know how the Moon tidal force affects the market, you may want to create such an index. Follow these steps:
It is an access to ULE models' library. Choose there the event you need to consider:
and tell the program to calculate it:
This is the Moon tidal force displayed together with FTSE100 index:
Within a couple of minutes, we have created this new "indicator". You can easily conduct the statistical research for this indicator. Also, it is easy now to check any related statements, like this one: "when the tidal force of the Moon is high, the volatility is high as well" or: "the high tidal force tends to turning points of FTSE100 index".
The Moon tidal force is well discussed in many sources in regards to so many different sides of our life. What about the Mars tidal force? No problem; you can do a research on it as well. All you need to do is just click this button:
You will get the Events Model Editor window. Here you can set the parameters of the events in regards to your research. Choose there Mars and click "Replace" button:
(Remember that it will work only if you were doing previously a research on the tidal force of any other planet. If you did something else, you have to go back, choose the corresponding category of events the "Gravitation and Tidal Force" item; see below for more details about this module.)
After the calculation. you get the diagram with Mars tidal force.
You can also draw the tidal forces for a combination of different planets. To do that, click "+" button for each new object. Adding Mars, Venus and Mercury's tidal forces events
and calculating these events, you may get a diagram like this one:
Here you see all three tidal forces of these three planets.
You can construct the more complicated events, like "tidal force index" as a sum of all tidal forces involved. Set L1+L2+L3 events formula:
Here L1 - Mars tidal force, L2 - Venus, and L3 - Mercury tidal force. L1+L2+L3 is the sum of these tidal forces:
Apply this index to different financial instruments to see how they correspond. Also, you can adjust this formula to any particular financial instrument setting some specific weights for these terms:
Here I increased the weight for Mercury tidal force five times. This is how this index looks now:
Important: I am not telling you here to use this index for your financial instrument. I am showing you the way how to find a proper index for your stock.
I recommend to investigate Model Editor Window. There are a lot of events there. This is a heart of Timing Solution software. These events are used to generate the projection line with Neural Network module. Though there are a lot of events used there, we constantly add new events.
Efficiency test module allows to estimate the effect that any phenomenon may have on the stock market.
Let's analyze how the aspect Sun - Jupiter conjunction affects Dow Jones index. Fill in the form for this aspect and click button:
You will get the efficiency test diagram. This diagram shows the average price movement around the culmination date of this aspect (percentage), including 10 days before and 10 days after the culmination ("culmination" means the exact moment of the aspect, with zero orb):
Thus we can see how Sun - Jupiter conjunction aspect affects the stock market in average. For our price data, it looks like the price tends to go DOWN 5 days prior the culmination (averaged price movement is 0.4% down), and then, after the culmination, it goes UP for another 7 days (averaged price movement is 0.5% up):
Remember that the averaged diagram does not provide the exact picture that you should use immediately. The efficiency test sometimes indicates a strong downtrend movement simply due to the fact that the strong downtrend movement coincides with this aspect. Therefore, the efficiency test serves mostly as an indicator of the factors that you should consider.
When we have the efficiency test done, it is very simple to figure out how the price moves in reality. Just drag the mouse cursor from the point A (a small circle that corresponds to 5 days prior the culmination of the aspect on the Efficiency test diagram) to the point B (the culmination point of the aspect). Here is the result:
As you see, the price went DOWN 65 times and 51 times it went UP. In other words, during our data set, this aspect took place 116 times in total, and 66 time the price went DOWN a week prior the culmination of the aspect, and 51 times it went UP. In this particular case, it is hard to make a conclusion as the effect is not certain. In real life situation it means that if you decide to trade using only this information (that the price tends to go down 5 days prior Sun - Jupiter conjunction), your chance to succeed is not certain as well.
However, that same efficiency test (for the same aspect, and based on the same data set) can give you a hint for another strategy. It is shown on the same diagram. Let's look at the price movement after the culmination (drag the mouse cursor from the point B (the culmination point) to the point C, 7 days after the culmination):
The price went UP 69 times versus 48 times DOWN. To me, this trading strategy is better than the previous one.
Last %X trades
In the example above we did Efficiency Test for DJII data. The
corresponding diagram shows the averaged picture, i.e. it shows how this aspect
has affected the price within more than 120 years, since 1885. Still, we may ask
a question: "Ok, maybe this aspect worked in this manner for more than 120 years. Does it work the same way now? I would like to know how this aspect has worked for the last ten years only, it
would give me more confidence". In order to do that, set "Last %X trades" option to 10
(%X means number of trades that we consider). Then click "Recalculate" button; the
chart appears on the screen that represents the same efficiency test diagram calculated for the last 10 aspects:
You can also see the detailed information about the price movement around this aspect in "History" tab:
The best strategy
As so far, we have seen several trading strategies provided by Efficiency Test for our sample financial instrument. Can we find the best possible strategy? Timing Solution software provides that opportunity.
Follow these steps:
After clicking "Optimize" button, you will get the rated list of strategies. Highlight the first one, 5 days after => 8 days after the culmination; you see that within this period of 3 trading days the price went up 75 times versus 41 times down. This strategy is better than other previously discussed strategies.
You always should remember that the price movement direction shown by Efficiency test diagram and the real price movement can be different.
Look at the example below. Efficiency test is calculated for Gold price for the moments when the Sun ingresses Scorpio:
This diagram shows an uptrend movement during 9 trading days after the ingress. How many times did the price go UP and how many times did it go DOWN within those 9 trading days after the Sun ingresses Scorpio? We can find that out. Drag the mouse to calculate this strategy:
As you see, this is actually DOWN strategy (23 Down versus 19 Up cases), while the Efficiency test indicates Up movement. It means that, though a number of cases when the price went down is higher than the number of cases with up movement, some of up movements were really big ones compared to down movements. (You can see that on the actual price chart.) This is a RISKY strategy, and the program marks such strategies with a dotted arrow. Be cautious with risky strategies.
The colored red/blue bars at the bottom of the Efficiency test diagram give us some clues regarding the effect of this aspect on turning points.
The brightest red bar with digits 59 indicates that 8 days after the culmination of this aspect TOP turning point took place 59 times, this is higher than the average value (look at other bars). Therefore, TOP turning point is more probable 8 days after Sun-Jupiter culmination.
In the same manner, the brightest blue bar with digit 54 indicates a probable BOTTOM turning point for the day of the culmination.
Let's consider the information string below in details:
It shows that the price went UP 75 times versus 41 times DOWN. But there are also digits in brackets, for UP and for DOWN . What do these digits 62 and 54 mean?
These are CONTROL GROUP digits. They mean that in average (regardless any aspect or any other phenomena) the price moves UP 62 times versus 54 times DOWN. In other words, the price moves UP more often than DOWN, it moves UP 53.4%. And it happens not because of the aspect that we explore, it is just the natural tendency of our financial instrument's price changes within our data set.
In practice it means that you should pay a special attention when the amount of UP cases is bigger than in the control group. In our example we have 75 UP cases while the control group indicates 62 UP cases only. Thus this aspect generates more UP movements than it occurs in average.
The same situation is for DOWN strategy:
This strategy generates 65 DOWN cases while the control group shows 53 DOWN cases only.
Simple ULE module
If you plan to work with several ULE models at the same time, we recommend to use "Simple ULE" module. Let's consider an example:
Suppose we need to calculate the moments when the Sun ingresses any sign of Zodiac and makes the aspect to other planets. In order to do that, you should create two ULE events: L1 - the Sun ingress to the signs, and L2 - the Sun making aspects:
Then we know that we should click "Calculate" ULE events. Do not do that. Instead, click "ULE" button here:
The program opens "Simple ULE" module with these ULE events, and we need just to select "Separately" item and make ON the option "Mark culminations":
The program will display these events in the Main screen together:
or they can be shown on different panels (one for ingresses and one for culminations) if the option "Panels" was selected:
You can run several "Simple ULE" modules for different models. In the screenshot below there are three models: green - declination index, red - tidal force and Sun aspects:
There is a special category of ULE events, manually defined events we call them Fundamentals. In ULE Editor they are here:
There are three categories of Fundamental ULE events:
1) Time Set: this is data time series. As an example, we can take measurements of temperature in Toronto. Day by day we get the information regarding the highest or the lowest temperature within a day. Another example is Sunspot activity data. It is recorded for almost 200 years, day by day.
How to build Time Set Fundamentals event? Here is an example:
Several years ago someone has sent me a file with tidal force data for Bern, calculated twice per hour. This is the part of that file:
12/31/1999 23:59:59 0.002
1/1/2000 0:29:59 -0.014
1/1/2000 1:0:0 -0.030
1/1/2000 1:29:59 -0.044
1/1/2000 1:59:59 -0.056
1/1/2000 2:30:0 -0.066
1/1/2000 2:59:59 -0.074
1/1/2000 3:29:59 -0.079
1/1/2000 4:0:0 -0.082
1/1/2000 4:29:59 -0.082
1/1/2000 4:59:59 -0.082
Let us create Fundamentals ULE event for this Time Set. RUN Timing Solution and try to open this file as any price history file, i.e. click this button:
and download this file Bern_Tidal.txt in a regular way:
IMPORTANT: you must take care of the correct time zone used in your Time Series and choose that time zone when you download the file. If Universal time is used, choose GMT time zone.
Now click "diskette" button, and in the popup menu choose "Save fundamentals ...", let it be BernTidal.csv file:
Now in ULE Editor you can open that BernTidal.vsv file:
Click calculate, and you get Bern tidal force together with the price chart (crude oil in the example):
2) Single Instantaneous Event: this is a category of events that take place from time to time. For example: from time to time (not every day), the FED announces rate change or USA election dates. These events affect the stock market somehow, and we can estimate this effect. Let us estimate the effect of USA election, when the Republicans were elected, like at the latest election 11/8/2016. We have downloaded a weekly chart for SNP 500 since the year 1950. Now open ULE editor, and in "Fundamentals" tab click this button:
and type there all dates since 1950 when Republicans were elected:
The format MM/DD/YYYY is used here. You can also specify the time as well, like this:
and point out the time zone for that moment in time:
Now click the diskette button to save these dates into some fundamentals file:
Let it be the file USARepublicansElected.fnd_d .
Now open this fundamentals file as usual:
Click "Calculate" button to get the dates when Republicans were elected together with SNP500 chart:
To estimate the effect of this political event, you can use Efficiency Test module. Do it this way:
Look, here Window parameter is set to 100, i.e. 100 weeks. In other words, this efficiency test shows the price movement plus minus 100 weeks (plus minus two years) around the election dates. Also we set the scale to the last election date (November 8, 2016); in this case the time scale is displayed, Accordingly, the Efficiency Test shows the projection line, averaged movement of SNP 500 around the dates when Republicans were elected.
More ULE events examples
Below more examples of ULE forms are shown. They were created based on questions of Timing Solution users. You may use these samples as references.
-Transit Sun passes Fire signs:
- transit Sun passes middle point between transit Mercury and Venus:
- the difference between the speed of the Sun and Mercury is zero (i.e the Sun speed has the same speed as Mercury):
- one of the planets the Sun, Mercury or Venus passes 17 degrees of Libra:
- the angle separation between the Sun and Jupiter reaches 225 degrees: