XLMidas.xla Paul Levine's Amazing MIDAS method of Technical Analysis
XLMidas.xla gives you the tools you need to implement Dr. Paul Levine's amazing Market Interpretation/Data Analysis System. I've got say up right up front that MIDAS ranks as one of my favorite technical analysis techniques. I was extremely hesitant to share this tool but if I figure if Dr. Levine could do it then so should I. I wouldn't trade without MIDAS and you shouldn't either. It's that good!
If you are not already familiar with the MIDAS method, then please take a moment to read my introductory article in order to familiarize yourself with the method and terminology.
At XLTrader our goal is to make technical analysis as easy as possible. In most cases all that is required of the analyst is to cut-and-paste the historical price information (O-H-L-C-V) into the data page of the HLC_Chart.xlt template then click on a graph sheet where the MIDAS toolbar is accessible.
Once the price bars are scaled the way the analyst wants them, then it is a simple matter to click the desired tool on the toolbar and follow the prompts. The macro will ask you to click on a point (H, L or Midpoint) and confirm your selection. You are then taken to the data page and asked to choose a column from a drop-box in which to put the calculations. Press OK then BOOM there's the curve to the chart. Its that easy!
But what if you are a power-user and you want more control? Perhaps you even want to write your own macros. NO PROBLEM! The MIDAS functions (which were written in C++ to speed up calculations and are in the midas.xll addin) are all readily accessible.
MIDAS S/R Curve
The heart of the MIDAS method is the S/R curve which of course is short for Support and Resistance. This function is accessible by clicking on the crowns icon in the tool bar.
The user is prompted to choose a point at which to anchor the S/R curve. Don't worry if you don't get the right one because using the arrow icons next to the crowns you can easily shift your S/R curve left or right as necessary. By holding down the shift key while you are clicking the arrow, you can move the curve a long way fast. Its not "click-n-drag easy" but close.
The MIDAS articles talked about using the midpoint (H+L)/2 in the calculations. Our XLMidas.xla implementation is a little more versatile. You can choose the H or L instead of the midpoint if you prefer. Per Levine's instructions, Granville's On Balance Volume (OBV), based upon the midpoint, is plotted on the secondary axis as shown on the figure above.
MIDAS Topfinder
XLMidas.xla also comes with a topfinder/bottomfinder algorithm. It is triggered by clicking on the toolbar icon with red price bars. The arrow icons next to the topfinder icon are used to adjust the volume of the pull-back (to adjust the "C" parameter as defined in Levine's articles).
When the market takes off (plummets) it is amazing how topfinder (bottomfinder) can pick the ending price and accurately estimate the number of days away it will be.
Another way topfinder can be used is as a trailing stoploss trigger. When the market has been moving up sharply and begins to correct, if it breaks through the topfinder curve, chances are very good that it will eventually fall to S/R. Likewise if there is a sell-off underway and price puts in a bottom and in so doing breaks through the bottomfinder curve chances are very good it will reach S/R. What a great tool to having your TA bag of tricks!
Parallel Offset
You might be wondering if you overlooked something in Levine's articles. The "Parallel Offset" function was not discussed there because it is my own MIDAS extension.
After years of using MIDAS and really loving how great the S/R curves were for determining theoretical support levels I realized something was missing. I needed a way to know definitively when a pullback to support would begin. After trying many different ideas I found what I was looking for and I call it "Parallel Offset"
The way this works, the "rules" as it were, are described in the help file that comes with XLMidas.xla. You are going to love the way this tool, in combination with S/R, gives you a price road map to the future. Its uncanny!
When we have access to and confidence in powerful timing tools like those contained in XLMidas.xla, we are better able to know when to put our money on the line and manage our minds once it is. Get XLMidas.xla by joining XLTrader-Talk Google group today.
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