A First-Order Recursive Price Smoother with Repeated Filtering

Summary

The document presents a recursive smoother that updates an initial price series toward the current close by a fixed fraction of the difference. It initializes a chain of intermediate values from median price, then propagates smoothing through the chain so that the final output is a more heavily filtered series. The example sets the chain length to ten and the update fraction to 50 percent.

It also colors price bars according to whether the close is above or below the final smoothed value, and returns both close and the smoother output. This can serve as a trend-visualization or signal component, but the document does not define a complete entry, exit, or risk-management strategy. It supplies no backtest, comparison with other filters, or guidance on choosing the chain length and update fraction. The remaining material concerns website privacy practices rather than trading methodology.

Key ideas

• The smoother repeatedly adjusts values by a fixed fraction of their gap from a reference price.
• A chain of intermediate recursive values produces the final smoothed series.
• The example uses median price for initialization, ten stages, and a 50 percent update fraction.
• Bar coloring indicates whether the close is above or below the final smoothed value.
• No performance evidence or parameter-selection method is provided.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.