The “Horizon of Limits” is a histogram chart designed to clearly show when, during a given period, historical lows and highs have manifested.
It can reveal intriguing trends, such as an asset’s tendency to touch its lows or highs during specific time frames. With the Y-axis showing frequency and the X-axis representing a time scale, this tool provides you with a clear view of the market’s historical behavior.
By grouping data into blocks, like 10-minute intervals, you can gain even more specific insights to refine your strategy.
This chart allows you to understand at which moments during the examined period the historical lows and highs were reached.
This histogram chart can reveal very interesting things to you; for instance, you might discover that the historical low is never reached during certain hours, or conversely, that most of the highs and lows occur at one or more specific moments in the period.
The chart displays on the Y-axis the number of times a limit has occurred, while the X-axis shows a time scale (for example, by setting the timeframe to “Day”, you will see all the minutes of the session on the X-axis). In some cases, the chart shows data grouped by aggregated periods, for example, from this chart, you can see how many times a low occurred in aggregated 10-minute periods.
This type of analysis allows you to add qualitative elements to your decisions on the best time to enter or exit the market, depending on your initial operation. Another example of use is related to the fact that if you know the points where the limits are never reached and a situation arises where this is happening, there is a high probability that it will not occur, and therefore you can take advantage of this likelihood as a statistical edge.
