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by webmaven 1491 days ago
> Yet, this tendency for myopia and prioritization of spectacle seems not align with many interests of mine. I find that a lot of the most significant levers on my life, both good and bad, seem to rely on compounding, on consistency and longer time periods.

This is quite insightful. It applies even more so to groups of people collectively (I'm sure I need not point out specific instances). All the more so when the data is noisy, and a bit of selectivity in setting the date range for analysis can result in the trend being minimized or reversed.

A moving average graph can help dispell this illusion, but the more aggressive the averaging the more it becomes a trailing indicator. One way to adjust for this is to use two moving averages (one longer one shorter) and plotting the difference between them. That will give you a fairly clear idea of whether the trend you're looking at is getting stronger, weaker, or reversing. It is still a trailing indicator but the trend-of-the-trend knowledge helps adjust for that.

1 comments

That's a great point! I vaguely tried to go in that direction by plotting the average over the past 7 days, the average over the 7 days before and the average over the year to date. Yet, I fully agree one might want to push this a little further and do as you describe. Thanks for the suggestion!
It's a common technique in stock market analysis:

https://en.m.wikipedia.org/wiki/MACD