Question 1

What are wavelets?

Accepted Answer

Wavelets are mathematical functions that decompose signals into different frequency components while preserving time information. Unlike Fourier transforms which only tell you what frequencies exist, wavelets tell you both what frequencies exist and when they occur. This makes them ideal for analyzing non-stationary signals like financial time series, audio, and sensor data.

Question 2

What is the difference between VectorWave and IronWave?

Accepted Answer

VectorWave is our Java wavelet library (Java 25+) with SIMD acceleration via the Vector API; ideal for JVM-based applications and enterprise systems. IronWave is our Rust wavelet library optimized for ultra-low-latency applications with sub-microsecond performance; perfect for high-frequency trading and embedded systems. Both provide the same core wavelet transforms (DWT, MODWT, SWT, CWT) with production-grade reliability.

Question 3

When should I use MODWT instead of DWT?

Accepted Answer

Use MODWT (Maximal Overlap Discrete Wavelet Transform) when you need shift-invariance, which is critical for financial time series analysis, volatility estimation, and any application where the alignment of features matters. MODWT works with any signal length and provides better statistical properties. Use DWT when you need compression or the most compact representation, as it is critically sampled with no redundancy.

Question 4

Which wavelet should I use for financial analysis?

Accepted Answer

For financial time series, Daubechies Db4 with MODWT is the most common choice, offering a good balance of time and frequency localization. Use Haar for jump detection and microstructure analysis. For smoother trend analysis, consider Symlets (Sym4) which have better phase properties. For volatility clustering detection, Morlet wavelets with CWT provide rich time-frequency information.

Question 5

How do I get started with wavelet analysis?

Accepted Answer

Start with our Quick Start guides: for Java applications, see the VectorWave Quick Start at https://docs.morphiqlabs.com/docs/vectorwave/getting-started/quick-start. For Rust applications, see the IronWave Quick Start at https://docs.morphiqlabs.com/docs/ironwave/getting-started/quick-start. Both guides walk you through installation, basic transforms, and common use cases like denoising and multi-scale analysis.

Question 6

What is wavelet denoising and how does it work?

Accepted Answer

Wavelet denoising removes noise from signals while preserving important features like edges and trends. It works by transforming the signal into wavelet coefficients, applying a threshold to remove small coefficients (which typically represent noise), and reconstructing the signal. Common thresholding methods include Universal, SURE, Minimax, and BayesShrink. VectorWave and IronWave both provide built-in denoising functions with multiple threshold options.

Strategy	Pattern	Best For	Complexity
Mentorship Model	Sweep → MSS → FVG	Reversals	Advanced
Silver Bullet	Time-based FVG	Specific windows	Intermediate
Unicorn Model	Breaker + FVG	Confluence setups	Advanced

Setting	Description
Session Start	Trading session begin time
Session End	Trading session end time
Kill Zones	High-probability time windows

Setting	Default	Description
Risk Per Trade	1%	Account risk percentage
Max Daily Loss	3%	Stop trading threshold
Max Trades Per Day	3	Limit overtrading

Setting	Description
Show FVG Zones	Highlight fair value gaps
Show Liquidity Levels	Mark buy/sell side liquidity
Show Order Blocks	Highlight OB zones
Show Structure	Draw HH/HL/LH/LL labels

Kill Zone	Time (EST)	Characteristics
London Open	02:00-05:00	Initial daily direction
NY AM	09:30-11:00	Highest volatility
NY Lunch	11:00-13:00	Manipulation
NY PM	13:30-16:00	Continuation moves

Overview

Studies

Strategies

Core Concepts

Market Structure

Fair Value Gaps (FVG)

Liquidity

Order Blocks

Breaker Blocks

Strategy Selection Guide

Choose Mentorship Model When:

Choose Silver Bullet When:

Choose Unicorn Model When:

Use Market Structure When:

Common Settings Across Strategies

Session Settings

Risk Management

Visual Settings

Recommended Progression

Time Windows (Kill Zones)

Best Practices

Confluence is Key

Wait for Confirmation

Manage Expectations

See Also

Studies​

Strategies​

Core Concepts​

Market Structure​

Fair Value Gaps (FVG)​

Liquidity​

Order Blocks​

Breaker Blocks​

Strategy Selection Guide​

Choose Mentorship Model When:​

Choose Silver Bullet When:​

Choose Unicorn Model When:​

Use Market Structure When:​

Common Settings Across Strategies​

Session Settings​

Risk Management​

Visual Settings​

Recommended Progression​

Time Windows (Kill Zones)​

Best Practices​

Confluence is Key​

Wait for Confirmation​

Manage Expectations​

See Also​