Profitable Trades
probability =  -------------------
                 Total Trades 

Suppose that you have made nine trades, six of which turned out to be profitable.

                 6
probability =  -----  =  67
                 9

What is the probability of winning for a future trade?

• The denominator of the fraction will increase by one for any outcome.
• But with the numerator, two options are possible - a future transaction may turn out to be either profitable, or unprofitable.
  • In other words, we have two possible options:

                (6+1)            6
probability =  -------   or   -------
                (9+1)          (9+1)

Using the average of these values, has the estimate of the probability of winning as follows:

                 6 + 0.5
probability =  ----------  =  0.65
                  9 + 1

Smoothing using Weights

double value=price[i+center],//Price value at the center
             max=_Point;           //Maximum deviation
      for(int j=0; j<period; j++)//Calculate price deviations from the central one and the max deviation
        {
         weight[j]=MathAbs(value-price[i+j]);
         max=MathMax(max,weight[j]);
        }
 
      double width=(period+1)*max/period,//correct the maximum deviation from the center so that there are no zeros at the ends
             sum=0,
             denom=0;
      for(int j=0; j<period; j++)//calculate weight ratios for each price
        {
         if(Smoothing==Linear)//linear smoothing
            weight[j]=1-weight[j]/width;
         if(Smoothing==Quadratic)//quadratic smoothing
            weight[j]=1-MathPow(weight[j]/width,2);
         if(Smoothing==Exponential)//exponential smoothing
            weight[j]=MathExp(-weight[j]/width);
 
         sum=sum+weight[j]*price[i+j];
         denom=denom+weight[j];
        }
 
      buffer[i]=sum/denom;//indicator value