Coin Market and the Stock Market

I'm a little suspicious about the moving average on the top chart. Except for a couple of brief intervals, the six month average is always above the unfiltered data. Cain't be right.

Cal

 

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"So my question is, when the Bear returns to the Stock market, as defined by a 20% drop, will this reverse the depressed coin market?"
Answer: maybe a dead cat bounce.

 

Um, the average is should be in the middle regardless of the magnitude of ups and downs. The purpose of a moving average is to smooth the data so that longer term trends become less obscured by short term fluctuations. The only ways the moving average can be consistently above or below the data from which it is supposedly derived are: 1. someone goofed or 2. data beyond the times at the ends of the horizontal scale are being used to calculate the averages.

Cal

 

Surely it's a six-month trailing average...? (If someone's got a reliable way to calculate a six-month leading average up to the present date, I'll pay good money to buy in!)

If overall movement is down, the trailing average would have to be above the current price for the most part.

 

There are a number of ways of handling the ends of a data series with regard to averaging. Let's assume no data will be used before the start or after the end, and if the end is the present date, obviously no data will be available beyond it. If the smoothing interval is 6, then the first and last three data points are problematic. One way is to simply use them as is. Another is to use 1/2 of the interval, averaging data points away from the ends (i.e. toward the middle). So for a smoothing interval of 6, the first data point would be replaced by the average of it and the next two data points; the last would be replaced by the average of it and the two previous data points. Another approach is to use the full number (six in the example) going forward from the first data point and back from the last data point. Any way you do it, the beginning and end of a smoothed data series will be a little noisy or be overly biased by its neighbors going forward (for first few data points) or going backward (for last few data points).

If the averaging interval is much smaller than the total span, which is usual and proper, then the smoothed curve should thread through the middle of a plot of the unsmoothed data. However, if there are a few extreme outliers in the raw data and they are extreme in the same direction, the smoothed curve may float above or below the majority of the raw data. There are special techniques for eliminating or decreasing the effect of outliers.

Cal

 

That is what you are seeing. Rather than recalculate the date using just the three years worth of date, you are seeing the last three years of the ten year chart and the data from the previous years is altering the running average.

 

Makes sense. Cal

 

thanks for the charts..continued to be confused and still will still be buying silver..coins..unk