Where's the PPS?

A reader the other day asked why I abandoned Person's Proprietary Signal (the pps) as an analytical tool in the latest revision of my trading method.

Three reasons.

First, the pps is closely tracked by the open-source parabolic sar. There is rarely a day's difference between signals on the two, and no strong pattern as to which one leads in giving a signal. There periods are almost identical. So, a dime one way, 10¢ the other. The practical differences between the two are insignificant.

(Compare those two to the macd, which has longer periods, or the fast stochastic, whose periods are shorter. Or to the 55-day/20-day price channel analysis, whose periods are much longer.)

Second, the pps is more prone to ghosting than is the parabolic sar. Ghosting is where a signal appears in the morning but disappears by the afternoon, rendering it invalid. I prefer signals that hang around for awhile rather than leading me down false paths. I find it disconcerting to place a trade based on a signal, only to find that the signal has disappeared moments after my trade is executed.

Third, the pps is proprietary. It is a copyrighted tool whose inner workings are hidden. It's a black box. As a trader, I prefer to know how my tools work, so I can better judge their efficacy.