TSF, Time Series Forecast is a technical analysis indicator showing the dynamics of the last point of the trend regression line at each individual time. It sounds complicated, but in reality, everything is simple. The resulting line of the Time Series Forecast indicator is a curve like the Moving Average. Each point of this curve is nothing but the last point of the regression line for a certain period. The set of these points is the TSF curve. This is why the forecast of the time series is often called the “Linear Regression Slip Line” and/or the “Regression Oscillator”.
The TSF line, the Time Series Forecast (Forecast of time series) is considered by the method of least squares. With this approach, the smallest deviation of the indicator line directly from prices is achieved.
Externally, the TSF is practically indistinguishable from the MA with a short period. However, the fundamental difference of this indicator from the Moving Average is that it is more sensitive to the current price, is more accurate in its forecasts. If MA is the average value of the price for a certain period, TSF is the adjusted (weighted) price indices for a certain period. In contrast to MA, the forecast of the time series follows the schedule without lagging or almost without it. That in turn opens the possibility of more accurate, timely signals to actions with the trading instrument. Due to its nature, TSF is extremely sensitive to prices and, in practice, does not miss significant movements, which makes it possible to earn money in the market.
The logic of his work lies in the title. Look again: The forecast of the time series. That is, the indicator predicts how the market will behave, based on calculations for a set period. If it turns around, then the market will go in the same direction. Naturally, this is an ideal situation, in practice, there will always be false signals. The truth is worth noting, if you work on a large timeframe (a day or more), false signals will be significantly less than if on a small one.
Adding Time Series Forecast Indicator to the MT
The forecast of time series (TSF, Time Series Forecast) is not included in the standard equipment of MT4 and MT5 trading platforms. In order to add it, you need to copy the indicator files to the appropriate directory on your computer.
If you have MetaTrader 4. Open C: \ Program Files . Then find the file folder of the trading terminal there and open it. Go to the … \ MQL4 \ Indicators directory and copy the TSF file / files, Time Series Forecast.
If you have MetaTrader 5. Open C: \ Program Files . Then find the file folder of the trading terminal there and open it. Go to the directory … \ MQL5 \ Indicators \ Examples and copy there the TSF file / files, Time Series Forecast.
After that, start the trading terminal. Click “Insert / Indicators / Custom” . A list of indicators appears. Select TSF, Time Series Forecast.
How to use Time Series Forecast Indicator?
Trading under the Time Series Forecast (TSF, Time Series Forecast) can be done in different ways. It’s only in your imagination. The easiest way is from the most reliable to use TSF as a signal line in combination with either the second TSF line but for a longer period, or with the usual moving average.
Deal to buy:
1. The TSF line broke bottom-up Moving Average of the longer period, we buy;
2. Stop Loss put on 3-5 points below the previous local extremum;
3. Close the deal when the price closed below the “big” moving average.
For a transaction to buy the reverse terms.
A few simple rules in conclusion
Remember, there are no indicators on Forex that are not mistaken. Forecast time series (TSF, Time Series Forecast), like any others, requires confirmation of their signals. When building your own trading system, use several indicators.
Observe Mani Management. Never in one transaction risk more than 2 percent of your capital. This approach protects you from ruin and will allow you to earn consistently in Forex using the Time Series Forecast (TSF).
Clearly follow your trading strategy. If you need to open a transaction based on the Time Series Forecast (TSF) strategy, open it, fix the result, fix it, and it does not matter if you are positive or not. Only following the rules of the TSF, Time Series Forecast (“Time series forecast”) “from and to” will make it possible to earn.