PCCI-as a filter_001
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The Digital PCCI Filter is a sophisticated technical analysis tool designed to smooth out market price fluctuations and reveal underlying trends. Instead of relying on simple averages, which can often be delayed or distorted by sudden spikes, this script employs a complex mathematical approach known as a digital filter to process price data.
Core Logic and Methodology
Weighted Data Processing The primary mechanism of this tool is its use of a comprehensive weighting system. The script examines a significant history of historical closing prices (specifically 106 distinct data points) to calculate a single "response" value. Unlike a standard moving average where every price might carry equal weight, this filter assigns a unique, precise decimal coefficient to each historical price point.
Positive and Negative Correlations The logic is unique because it applies both positive and negative weights to different segments of the historical data:
- Recent Trends: Certain recent price points are given specific positive coefficients to ensure the filter remains relevant to current market movement.
- Noise Cancellation: Other historical points are assigned negative coefficients. This acts as a "subtractive" mechanism, effectively canceling out market noise, outliers, and erratic fluctuations that might otherwise create false signals.
Calculation Flow
- Data Gathering: The script looks back at the last 106 closing prices on the chart.
- Mathematical Synthesis: It multiplies each of those 106 prices by its corresponding unique coefficient (the "weights") and sums them together to create a single filtered value.
- Final Result: The script then subtracts this calculated "response" from the current market price.
- Visual Output: The final result is plotted on a separate window as a smooth red line.
Practical Purpose
By combining these complex positive and negative weights, the filter attempts to strip away the "jitter" of the marketplace. The goal is to provide the user with a stabilized visual representation of price movement, helping to distinguish between temporary price volatility and the true direction of the market trend.
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PCCI-as a filter_001
//+------------------------------------------------------------------+
//| Digital PCCI Filter |
//| Copyright (c) Sergey Iljukhin, Novosibirsk. |
//| mailto:sergey@tibet.ru http://fx.qrz.ru/ |
//+------------------------------------------------------------------+
#property copyright "Copyright (c) 2005, Sergey Iljukhin, Novosibirsk"
#property link "mailto:sergey@tibet.ru"
// --- Parameters: P1=38, D1=28, A1=40
// --- P2=52, D2=31, A2=40, Ripple=0.08, Delay=0
// --- Order [Auto]=106, Calculate method=2
#property indicator_separate_window
#property indicator_buffers 1
#property indicator_color1 Red
//---- buffers
double FilterBuffer[];
//+------------------------------------------------------------------+
//| Digital filter indicator initialization function |
//+------------------------------------------------------------------+
int init()
{
string short_name;
//---- indicator line
SetIndexStyle(0,DRAW_LINE);
SetIndexBuffer(0,FilterBuffer);
SetIndexDrawBegin(0,106);
//----
return(0);
}
//+------------------------------------------------------------------+
//| Digital filter main function |
//+------------------------------------------------------------------+
int start()
{
int i,counted_bars=IndicatorCounted();
double response;
//----
if(Bars<=106) return(0);
//---- initial zero
if(counted_bars<106)
for(i=1;i<=0;i++) FilterBuffer[Bars-i]=0.0;
//----
i=Bars-106-1;
if(counted_bars>=106) i=Bars-counted_bars-1;
while(i>=0)
{
response=
0.1177628838235*Close[i+0]
+0.1170077388431*Close[i+1]
+0.1147601209029*Close[i+2]
+0.1110729054065*Close[i+3]
+0.1060324421434*Close[i+4]
+0.0997560988008*Close[i+5]
+0.0923890376402*Close[i+6]
+0.0841000389219*Close[i+7]
+0.0750766919597*Close[i+8]
+0.0655202662708*Close[i+9]
+0.0556401583046*Close[i+10]
+0.0456482572592*Close[i+11]
+0.0357530528012*Close[i+12]
+0.02615415804227*Close[i+13]
+0.01703731282680*Close[i+14]
+0.00856960311288*Close[i+15]
+0.000895555708556*Close[i+16]
-0.00586627422066*Close[i+17]
-0.01162552971203*Close[i+18]
-0.01632152444323*Close[i+19]
-0.01992414580732*Close[i+20]
-0.02243335117589*Close[i+21]
-0.02387813894599*Close[i+22]
-0.02431430200598*Close[i+23]
-0.02382176331725*Close[i+24]
-0.02250140527159*Close[i+25]
-0.02047075493180*Close[i+26]
-0.01786000052706*Close[i+27]
-0.01480733499641*Close[i+28]
-0.01145463232852*Close[i+29]
-0.00794304696010*Close[i+30]
-0.00440829083275*Close[i+31]
-0.000977238472653*Close[i+32]
+0.002235823933755*Close[i+33]
+0.00513191787383*Close[i+34]
+0.00762972457736*Close[i+35]
+0.00966747623918*Close[i+36]
+0.01120310303187*Close[i+37]
+0.01221499285956*Close[i+38]
+0.01270127547603*Close[i+39]
+0.01267881242200*Close[i+40]
+0.01218165493397*Close[i+41]
+0.01125820035359*Close[i+42]
+0.00996954486984*Close[i+43]
+0.00838605323109*Close[i+44]
+0.00658436935337*Close[i+45]
+0.00464439195323*Close[i+46]
+0.002645759417416*Close[i+47]
+0.000666068159555*Close[i+48]
-0.001222776729259*Close[i+49]
-0.002956488520058*Close[i+50]
-0.00448011021214*Close[i+51]
-0.00574988855361*Close[i+52]
-0.00673332989225*Close[i+53]
-0.00741117882839*Close[i+54]
-0.00777644547070*Close[i+55]
-0.00783388153265*Close[i+56]
-0.00759966748743*Close[i+57]
-0.00709931269272*Close[i+58]
-0.00636769053766*Close[i+59]
-0.00544559940274*Close[i+60]
-0.00437852874428*Close[i+61]
-0.00321542503890*Close[i+62]
-0.002005580069262*Close[i+63]
-0.000798178859997*Close[i+64]
+0.000361723322003*Close[i+65]
+0.001433101593600*Close[i+66]
+0.002380073229874*Close[i+67]
+0.00317453700490*Close[i+68]
+0.00379492177651*Close[i+69]
+0.00422884523807*Close[i+70]
+0.00447038314289*Close[i+71]
+0.00452100306476*Close[i+72]
+0.00439082398691*Close[i+73]
+0.00409492037175*Close[i+74]
+0.00365528338580*Close[i+75]
+0.003096238149856*Close[i+76]
+0.002446112685573*Close[i+77]
+0.001736376831290*Close[i+78]
+0.000996103380422*Close[i+79]
+0.0002557237615143*Close[i+80]
-0.000458282529397*Close[i+81]
-0.001119581482823*Close[i+82]
-0.001704893115208*Close[i+83]
-0.002199032152313*Close[i+84]
-0.002586916898054*Close[i+85]
-0.002861741841535*Close[i+86]
-0.003018651749353*Close[i+87]
-0.003060101508137*Close[i+88]
-0.002997112675297*Close[i+89]
-0.002834938217095*Close[i+90]
-0.002589089321820*Close[i+91]
-0.002272072078644*Close[i+92]
-0.001902835889698*Close[i+93]
-0.001502872027811*Close[i+94]
-0.001077466851623*Close[i+95]
-0.000655481642188*Close[i+96]
-0.0002511660753314*Close[i+97]
+0.0001137882502083*Close[i+98]
+0.000426098842482*Close[i+99]
+0.000714775119642*Close[i+100]
+0.000916639580735*Close[i+101]
+0.001063116482197*Close[i+102]
+0.001143113996535*Close[i+103]
+0.001159315803654*Close[i+104]
+0.00922554212244*Close[i+105];
FilterBuffer[i]=Close[i]-response;
i--;
}
return(0);
}
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