XABCD™ Hurst Indicator

Discovers Potential

Persistence or Anti-Persistence

In The Market

Indicator Included with the XABCD Pattern Suite™


The XABCD Hurst indicator is included in our XABCD Pattern Suite for NinjaTrader or MetaTrader. We use these indicators to assist us in our pattern trading as the values from Hurst can be useful to show us if the data has a higher amount of persistence or anti-persistence according to the Hurst Exponent calculation.

How Hurst Is Used?

Showing You The Story

1When the current reading is high there is a lot of persistence (Used in trend following situations)


Persistance
1

0.5When it's in the middle, it doesn't have anti-persistence or persistence - we consider that a coin flip and leave it alone.


Randomness
0.5

0A low Hurst value would show anti-persistence (Used in reversal situations)


Anti-Persistance
0.1
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Weighting Trades Consistently

Weighting trades consistently can be very difficult to do. When you use something like the Hurst it makes your approach a lot more consistent.

For example, you could weight reversal traders more when the Hurst shows strong anti-persistance.

If you're trading a reversal pattern and you see strong persistance then you can weight the trade a lot less.

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Important Factors

Created "Outside" The Market

When considering using the hurst there are a few things to consider that are not so obvious at first glance. Most of the indicators in your platform were created with the purpose of being used in the market.

The Hurst was not created for the market. Its application was created for the flow of water down the Nile river which shows a real world application. The idea is water flow is non-linear meaning it doesn't move in a straight line and appears random.

Just how the market is also non-linear. Price doesn't move in a straight line and will also appear random. So the same tools that have already been proven useful in the real world are now being applied to financial markets.

The past 25 years have witnessed an explosion of interest in non-linear dynamical systems, in mathematics as well as in applied sciences.

Cost: Included with the XABCD Pattern Suite™
Platforms:
NinjaTrader 7, NinjaTrader 8
MetaTrader 4, MetaTrader 5