October 28, 2021

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Entropy Math

Entropy is a measure of disorder, a term used for the most part in physics. In simple words: the level of entropy is determined by the degree of uniformity of the distribution of something (for example, matter) in space. If the salt with the water lay in a cube, the entropy of the state is small, and if it is dissolved and distributed evenly throughout the glass, then it is large. How to measure the state of the chaos? The question is rhetorical. Indeed, the greater the entropy, the greater the number of variations of permutations in it is possible. A cube of salt in water can be located in only a few positions and a dissolved cube in as many as you like. There is something similar in the market.The concept of entropy is associated with chaos, where there are billions of possible variations. But this does not mean at all that it is impossible to find a pattern in it. The starry sky can be called high entropy, but nevertheless, there are constellations in it. The Entropy Math indicator looks for patterns on the basis of which a trading strategy is built.

Source: https://fxtradingrevolution.com/forex-indicators-robots/entropy-math-indicator.-chaos-theory-in-forex

You can find more about Maximum Entropy Method

 

Indicator is implemented for: MT4/MT5/Tradestation/ Multicharts

 

How to import custom indicators to SQX: https://strategyquant.com/doc/programming-for-sq/import-export-custom-indicators-and-other-snippets/

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Emmanuel
Emmanuel
December 20, 2021 3:11 pm

This is a good idea !!!!!!!!!!

Emmanuel
Emmanuel
December 20, 2021 3:14 pm

Awesome !!! the math behind it is really interesting !!! it take time to understand it