Update April 20, 2016A little bit of history...
The dynamic model is one of the most interesting and promising forecast models. There is some history behind that model...
Initially it was just one sample there, nothing else. Later I have found that this sample provides a rather good projection line. So, I have conducted a detailed research of this model applying Walk Forward Analysis. And I have found that this model really works, even better than Annual cycle. However, I put it aside, and later I returned to that dynamic model again. I kept returning to it many times trying to improve it. The problem with the original dynamic model was: it has been too choppy, having too many jumps there, as shown on this picture:
This is the main reason why I have not advertised this model much. Then, for two years already, I began receiving questions from users regarding this model. They sent me screenshots with that jumpy projection line calculated for different financial instruments.
For that reason, in March 2016, I have decided to finalize this model no matter how much time this task takes.
Declination projection line looks like this (this is declination Waxing/Waning for gold). As you see, it is not an ideal, of course. But it still catches many moves:
What is important is the fact that it does not correlate to Annual model. In other words, it deals with independent information.
and this is how this element works in time:
Simply compare two similar events considered in different models of the program:
This group of controls allows to set the involved planetary pairs and Zodiac type:
This parameter below helps to specify how dynamic terms are calculated, this is where we can fight those jumps:
I recommend to use "#2 2-Fold" or "#6 Smooth" options.
The step parameter: I recommend to keep it as it is, or you may increase it to 30:
As I said, the dynamic model is similar to a waxing/waning model, this is the extension of the waxing/waning model. Using this option, you can calculate either a pure waxing/waning event by excluding all other dynamic terms or the full dynamic model:
Actually you can simplify your life choosing one of standard the most typical setups for the dynamic model:
And do not forget about smoothing: you can now smooth Neural Network projection line using this option:
I highly recommend to use smoothing for any dynamic model, it improves the forecast ability of the projection line based on the dynamic mode. The importance of smoothing is confirmed by Walk Forward Analysis.
We have conducted WFA for four financial instruments (SNP 500, Gold, Crude Oil and EuroUSD all EOD data) applying for them 20 variants of standard dynamic models which are present in standard setups. Here are results:
|Instrument||The best model||WFA result|
|S&P 500 index||Model #7 and #15||
|Gold||Model #8 and #20||
|Crude Oil||Model #7 and #8||
|EuroUSD||Model #1, #2 and #20||
For all these models, smoothing value of 10 in Neural Network is used:
So you can easily build an appropriate dynamic model this way: as an example for S&P500 we have the best model #7; simply choose the standard setup #7 in Dynamic model constructor and train the Neural Net: