V. 22:8 (10-18): Letters To The Editor by Technical Analysis, Inc.

V. 22:8 (10-18): Letters To The Editor by Technical Analysis, Inc.
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Letters To The Editor by Technical Analysis, Inc.



As one who has more gray in his beard than he’d like, I wanted to point out that the “zigzag indicator” or “zigzag filter” referred to in Norman J. Brown’s June 2004 article is misnamed. I believe the mistake started when Equis included this indicator in the first version of its MetaStock charting software. CompuTrac did not include the indicator in its package (I told you there was too much gray in my beard).

At any rate, the concept was introduced before IBM had even introduced the first PC. It was originally introduced by Arthur Merrill in his book, Filtered Waves: Basic Theory. That’s the proper name for the indicator — Merrill’s filtered waves, not “zigzag.” That book is filled with an amazing amount of precomputer calculations and insights. Merrill didn’t start in technical analysis until he retired from GE, after what most would have considered a full career. The Market Technicians Association honored him with their annual award years ago for what he did in his second career as a technical analyst. He is still alive and well (in his 90s, I believe).

Just as we no longer call the Arms index by the old Quotron symbol for it (TRIN), we should use the term Merrill’s filtered waves, or at least use Merrill’s term, filtered waves, when referring to the indicator. There are few truly new ideas in the world, much less so in this business. When they are introduced, we should give credit where it is due.

JOHN CARDER, CMT Topline Investment Graphics www.topline-charts.com or www.chartguy.com

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