# Question 4 1 answer below »

Must complete using stata and provide do

files, graphs produced in stata and smcl log outputs. I also provided data in excel as expert may not have access to stata version 12. If expert does have stata version 12, no need to use excel exports.

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Assignment 4- Must complete using stata and must provide do files, graphs produced in stata and smcl log outputs.

Moving average oscillators are often used to determine when to buy and sell (or sell short) securities. They also can be used to help signal trends in the underlying data. Oscillators are calculated by dividing one moving average series by another (note the actual value of the data series is the same as a 1-period moving average). Therefore, a 1/12 quarter oscillator is simply the quarterly value divided by the 12-quarter moving average of the quarterly series. When the 1/12 oscillator crosses above the 1.00 level, the value moves above its own 12-quarter moving average, and that is interpreted as a bullish signal. Conversely, when the value moves below its own 12-quarter moving average, the 1/12 oscillator also crosses below the 1.00 level, and that is taken as a bearish sign. Plotting the data makes it easy to see when the oscillator crosses above and below the 1.00 level (i.e. tsline oscillator, yline(1)). Calculate the 1/12 quarter oscillator using the USCSCOMHPINSA variable in the USCSCOMHPINSA.dta file and answer the following questions (calculate the moving average as a 12-period exponential moving average).

According to the oscillator are we currently in a bearish or bullish housing market?

In what quarter did the current bearish/bullish market begin?

In what quarter did we hit the bottom of the last bearish market?

In what quarter did the last bull market begin?

In what quarter did the last bull market end?

Use all observations in the USCSCOMHPINSA.dta file to perform a Holt-Winters forecast for the next eight quarters and answer the following questions.

What is the underlying seasonal index for each of the four quarters? (Round to two decimal places)

QuarterIndex1234What are the forecast of the US National Composite Home Price Index and the upper and lower 95% confidence levels for the next 8 quarters?…