In this paper, two hybrid models are used for timing of the stock markets on the basis of the technical analysis of Japanese Candlestick by Support Vector Machine (SVM) and Heuristic Algorithms of Imperialist Competition and Genetic. In the first model, SVM and Imperialist Competition Algorithm (ICA) are developed for stock market timing in which ICA is used to optimize the SVM parameters. In the second model, SVM is used with Genetic Algorithm (GA) where GA is used for feature selection in addition to SVM parameters optimization. Here the two approaches, Raw-based and Signal-based are devised on the basis of the literature to generate the input data of the model. For a comparison, the Hit Rate is considered as the percentage of correct predictions for periods of 1–6 day. The results show that SVM-ICA performance is better than SVM-GA and most importantly the feed-forward static neural network of the literature as the standard one.

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Keywords Candlestick technical analysis, Finance, Genetic Algorithm, Imperialist Competition Algorithm, Stock market forecasting, Support Vector Machine
Persistent URL dx.doi.org/10.1016/j.eswa.2017.10.023
Journal Expert Systems with Applications
Citation
Ahmadi, E. (Elham), Jasemi, M. (Milad), Monplaisir, L. (Leslie), Nabavi, M.A. (Mohammad Amin), Mahmoodi, A. (Armin), & Amini Jam, P. (Pegah). (2018). New efficient hybrid candlestick technical analysis model for stock market timing on the basis of the Support Vector Machine and Heuristic Algorithms of Imperialist Competition and Genetic. Expert Systems with Applications, 94, 21–31. doi:10.1016/j.eswa.2017.10.023