Statistical Methods in Finance 2019

Dec 16 - 21, 2019


An exploration on fuzzy inference system for daily trading decision under fuzzy environmental

by Venugopal R, PSG College of Technology

To be successful in stock trading, it is necessary to predict the future market trends. Many professional traders use technical analysis to forecast future market prices. The main objective of this study is to develop a new indicator using fuzzy inference system. The technical indicators such as Moving Average Convergence and Divergence (MACD), Relative Strength Index (RSI), Stochastic Oscillator (SO) and On-Balance Volume (OBV) are used to calculate historical stock data. These technical indicators are used as input for fuzzy inference system (FIS) to create fuzzy rules and its membership functions based on the prior knowledge of decision experts. This fuzzy inference system recommends daily trading decisions such as buy, hold, and sell signals. The developed fuzzy indicator model compared with the most popular technical indicators by using Fuzzy-Multi criteria decision making methods (FMCDM). The outcome of the results helps in assisting the managers and traders to understand the relationship among the selected stocks.