Definitions
In plain terms
It forms the numerator of Kaufman's efficiency ratio.
Technical
The endpoints, input adjustment basis, valid-observation counting, and missing-value policy must match the path-length denominator.
Scope
It ignores the route taken between the two endpoints.
Formula
Directional change = abs(x_t - x_(t-n))DC_t=|x_t-x_{t-n}|| Symbol | Meaning | Unit |
|---|---|---|
x_t | current input | input unit |
x_(t-n) | lookback-start input | input unit |
Output unit: input unit
Examples
- A governed lesson uses Directional Change only with declared inputs, timing, parameters, and edge-case behavior.
Common misconceptions
- It ignores the route taken between the two endpoints.
Concept relationships
Related
Required by
Where this concept is used
Evidence and governance
- Kaufman Adaptive Moving Average TA-Lib · first party technical publication
Supports: preferred label, short definition, technical definition, formula
Limits: Implementation seeding, readiness, and parameter defaults must be frozen for reproducible parity.
- Reviewed by
- fintech-builder-batch-006
- Last reviewed
- 2026-07-27
- Next review
- 2027-07-27
- Record status
- evidence reviewed
This record is evidence-reviewed and readable, but not yet promoted to published — it is served noindex,follow and excluded from the sitemap.