EdgeWare FastBreak Standard Version 6.5 - Manual (Page 103)

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ing; however, we must first determine if this is in fact a new, better (steeper) upward
trend or just a temporary price aberration. FastBreak performs two checks to make a de-
termination on the trend. First, you will see that BAT has three parameter text boxes
similar to BOOM. The nature of these parameters is very similar to the BOOM parame-
ters, and as with the BOOM algorithm they are propriety. Suffice to say, the parameters
are used to make a statistical determination if the breakout is real.
BAT makes a second check to determine if the new trend is valid. BAT looks at all the
price points beginning with the estimated breakout point to verify that the price points
have not violated the original long term trend. The theory is that as long as the price stays
above the long term trend then at a minimum the long term trend is intact. If the price
breaks below the original long term trend then BAT will continue looking along the rank-
ing period for other possible breakouts to the upside.
If BAT doesn’t detect a new price trend, then the algorithm simply defaults to Linear
Slope ranking for that time period.
Using RAT along with BAT
RAT can be used in conjunction with BAT if a new trendline is confirmed or all the
time. If RAT is activated with BAT then the assumption is that short term price moves
(above or below the new price trend) are in fact temporary. The assumption is that the
price excursions from the new price trend are temporary and the price will revert back to
the new trend. See previous chart. Just as with the earlier explanation for RAT, this can
be a positive or a negative depending on if the price moves below or above the new trend
respectively. One advantage to using RAT in conjunction with BAT only (and only when
a new breakout is confirmed) is that a check is made to be sure downward temporary
prices moves don’t violate the original long term price trend.
It wasn’t clear when it was best to use RAT when also using BAT so we put in checkbox
options to cover all cases.
To use RAT along with BAT but only when a new breakout is determined, then use the
following check box:
If you are using BAT and want to use RAT but not when a new trend is determined then
check this box:
If you are using BAT and prefer to use RAT all the time then you will need to check both
RAT options: