Technical analysis is a common method for using charts to predict the trend in a time series of stock prices. To increase efficiency, most chartists use multiple indicators to decide on market and individual stock direction. Unfortunately, there is a great deal of uncertainty as to which are the best indicators, as well as how the individual indicators should be interpreted. The following will employ the use of fuzzy logic for deciding upon the best combinations of indicators, as well as accounting for the uncertainty within each individual indicator, providing a signal to buy, hold, or sell. The performance of the fuzzy model incorporating trading heuristics is demonstrated for various individual stocks.
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