Jack - request for help please
David Marshall
I am having difficulty finding suitable trading candidates using
stocktables.com - mainly because most of the stocks with "EPS>90 and RS>90"
have volumes that are far too thin. I guess this might be due to current
market conditions but it is getting very frustrating. I would greatly
appreciate any guidance that you can give on this - perhaps with an example
list. It did pick CACI today which had a spectacular gain of 8.6% but the
accumulation was -4.
I have been experimenting with your TC2000 scans but I am not entirely clear
that I understand the process. In your post on misc.invest.futures dated
1998/11/27 there are 7 equations. The first 3 I presume scan for Dry Up.
Should these be used to generate 3 separate lists? What is the principle
behind the 3 equations? How do I interpret the resulting lists?
I assume that the next two equations (#5 and 6) scan for FRV but equation 6
appears to be identical to the first half of equation 5 so I cannot
understand why they are listed separately. I expect that there is a logical
reason but I can't see it yet.
Equations 7 and 8 clearly looks for gains of between 5 and 10% and are used
to anticpate exit. I think there must be a typo in #6 - should it read <10
at the end?
I have added additional criteria such as price>$10 and 65 day ma
volume>300k. Equations 1,2 and 3 give the following candidates EOD today:
1. RA,VRTY,HOTJ,RSG,LRY,SRA,IPCR,BSB
2. PDX,NITE,INT,FIF,USPI,STRC,CLKB,BMRN,SLXP,VSNX,PMACA,ATAC,SLMC
3. DYN,HOTJ,DTPI,RSG,SPLX,BMRN,SPWX,IPCR,VSNX,BSB
Equation 4 gives 128 candidates (limiting the scan to the NASDAQ) but no
candidates from lists 1 to 3.
I came across a charting package yesterday from www.sierrachart.com which I
am now evaluating. You may be interested to know that the indicators offer
moving average and macd of volume. It is a simple matter to plot ma5 and
ma30 volume and I have been trying to correlate crossover with buying
opportunities - not much success so far.
Any help/advice that you can offer would be greatly appreciated.
Thanks
David
Jack Hershey
"David Marshall" <davidkma...@hotmail.com> wrote in message
news:JKH38.12620$Ph2.1...@news2-win.server.ntlworld.com...
David Marshall
grips with your method. The fact that is built upon such a solid foundation
appeals to me.
I have been doing a bit more "message mining" since my last post (ring
binder getting fatter). I've managed to resolve the ">" typo so equations
now in place. I'm also clear that 1st 3 are DU, 2nd two are FRV and last 2
are exits.Still not sure why you had 3 DU lists and 2 FRV lists though. I
see that you gave up on TC2000 after the release of v4. Was that because you
could not incorporate an equivalent scan for EPS and RS ranking >90? Do you
rely totally upon stocktables now for finding new candidates?
I've done a little more work on stocktables and compiled a preliminary
watchlist:
RSTN, JDEC, IPIC, OVER, WBSN, HLPA, VRST, AMHC
all of which took a pasting today. :) I thought RSTN might survive but its
pro rata volume dropped dramatically today, way under the 65 day ma. It
seems to have turned south again, heading for the bottom of the channel.
It is certainly a very different perspective watching volume so closely
intraday. Ever since reading "Tape reading and market tactics" by Humphrey
B. Neill, I have been convinced that volume is the answer. I just haven't
been able to get a grip on how to use it - but I think the answer is close.
Kind regards
David
"Jack Hershey" <jhers...@home.com> wrote in message
news:W0h48.2398$vc.4...@news1.rdc1.az.home.com...
Jack Hershey
"David Marshall" <davidkma...@hotmail.com> wrote in message
news:JKH38.12620$Ph2.1...@news2-win.server.ntlworld.com...
> I am having difficulty finding suitable trading candidates using
> stocktables.com - mainly because most of the stocks with "EPS>90 and
RS>90"
> have volumes that are far too thin. I guess this might be due to current
> market conditions but it is getting very frustrating. I would greatly
> appreciate any guidance that you can give on this - perhaps with an
example
> list. It did pick CACI today which had a spectacular gain of 8.6% but the
> accumulation was -4.
>
both. The three sub lists from the sort to find 7's, 0's and 1's is only
half of what it usually is. These days, I keep some old reliables in my
universe than haven't met this quality test. Our goal is to have a good
selection for rotating and these are thinner times than usual. I have cut
my streams of cash to fewer in number and have put more into each stream.
You have to keep the thin volume out of the picture at all times. I usually
do not get in and out in one block of shares for a given account. I do go
in and out with market trades usually and that is why I get more than one
price for this.
If you can keep several very reliable stocks, that is with respect to their
signals form indicators, you will be able to keep the rotation going fairly
well. I look forward to the broadening of quality selections as well.
Jack Hershey
Version 3.0 through the y2k period. I guess I still have a fair amount of
cash on credit there. several of us worked long and hard to try to transfer
the stuff into newer versions. We also tried to pickup on using anything to
segway into the future.
The path turned out to be into Excel and Access at first. Then to
convenience and independent ways from TC2000. In TC2000 you do see people
pressing the Reps for info on when TC2000 will get back in the groove.
> I have been experimenting with your TC2000 scans but I am not entirely
clear
> that I understand the process. In your post on misc.invest.futures dated
> 1998/11/27 there are 7 equations. The first 3 I presume scan for Dry Up.
> Should these be used to generate 3 separate lists? What is the principle
> behind the 3 equations? How do I interpret the resulting lists?
The first three are for Dry Up as you suggest. Think of coming into Dry Up
as a landing pattern and the equations differentiate how far out the plane
is first of all.
One of the equations also was put in place to capture landings that
intemperate mutual funds managers wreck by block trading improperly. It is
the one with the slot in it that lets a couple of days data be excluded
befor the plane lands. The high volume blocks fly through and they are
ignored on the way in momentarily. that means they show up and then
dissappear again. The momentary glimpse lets us put them into a portfolio
and see them. you can then determine whether the stocks is going to be
messed up frequently or not. If not, then it is playable. You can easily
see the offset MA ,the gap and the current MA combo there in the algebra.
What I did with the lists is keep track of appearances, their duration, and
their dissappearance into the 7's. It is a cool early warning system.
It all comes from the P, V relationship. Bogle was on CNN yesterday with a
financial chick as a counterpoint. As the Man at Vanguard, he was lamenting
the quality thing and how everyone forgot how it works. He mentioned only
Graham and the days when P,V was making alot of stuff roll. It was fun to
see. Between Benjaman Graham and Granville there were certainly a lot of
fish fried in those days.
The choice of predicting or forecasting compared to anticipating is really
not a choice except one of convenience. Once you know that in trend cycles,
the volume and price landing occurs BEFORE the three concurrent events of:
increasing volume, then increasing price and strong accumulation merge to
cause Breakouts (BO), you are in a place just like shooting fish in a
barrel. Scoring 7 is that concurrence. And it comes right after 1, then 0.
It was an important event for me to be able to characterize this stuff in
equations and back it up with the countdown scoring by weighting the
variables in improtance and frequency. you can look at every TA formation
and see their consistancy played out in terms of the Boolean expressions for
the P,V relationship.
Making money on the right fractal is a terrific experience year after year
after year.
>
> I assume that the next two equations (#5 and 6) scan for FRV but equation
6
> appears to be identical to the first half of equation 5 so I cannot
> understand why they are listed separately. I expect that there is a
logical
> reason but I can't see it yet.
Well this is just a small practicality. I started withone and added an
adjustment. there's not much difference. I guess I am a hoarder of stuff
it was hard to throw out after people were using it.
>
> Equations 7 and 8 clearly looks for gains of between 5 and 10% and are
used
> to anticpate exit. I think there must be a typo in #6 - should it read <10
> at the end?
Yes these are pre exit indicators. I have gone from one level of investing
to another and each has its own little corrolaries to factor in. It is
important to always be taking money out of the market and use it for stuff.
But you can get behind sometimes. Then you wind up having to fight your way
in and out. So then you need to actually anticipate leaving to be able to
trade into the peak across the peak and, if neccessary down the other side a
little ways all on a given day. The ratio of in to out trades is 2 to 3. I
have had to take over 4 hours on the way out.
From use, I believe the math is right there.
>
> I have added additional criteria such as price>$10 and 65 day ma
> volume>300k. Equations 1,2 and 3 give the following candidates EOD today:
> 1. RA,VRTY,HOTJ,RSG,LRY,SRA,IPCR,BSB
> 2. PDX,NITE,INT,FIF,USPI,STRC,CLKB,BMRN,SLXP,VSNX,PMACA,ATAC,SLMC
> 3. DYN,HOTJ,DTPI,RSG,SPLX,BMRN,SPWX,IPCR,VSNX,BSB
Okay you are using a large universe. Those are good values to keep your
trading running smoothly. I was running universes that were limited through
other means. Largely sector analysis and leader/lagger relationships. The
important aspect of your lists is their length; you are in the groove for
sure.
>
> Equation 4 gives 128 candidates (limiting the scan to the NASDAQ) but no
> candidates from lists 1 to 3. (my comment here; I take it you mean eq. 1
to 3 but I think I see the results above and not all nasdaq)
Give me a hand, I have a chioce of going through a ton of floppies, getting
hung up in TC2000 for some reason they give me on the screen or actually
setting up a computer that is in storage (I can see it easily, though).
Please post the equations by copying and pasting if you will. They can
possibly be used elsewhere than TC2000. I always give away everything as a
way of learning.
I will look at the picks next.
And finally parse the equation set.
Jack Hershey
I
> am now evaluating. You may be interested to know that the indicators offer
> moving average and macd of volume. It is a simple matter to plot ma5 and
> ma30 volume and I have been trying to correlate crossover with buying
> opportunities - not much success so far.
>
> Any help/advice that you can offer would be greatly appreciated.
I am going to check this out. An MACD of volume is hard to come by in most
software packages.
when you go to a new MACD on something, first go for the overall time span
to connect with the trading cycle. The small number is set up for contrast
with the large around half or less works well. Always bracket your
averaging of this difference with a value that is in-between. It is hard to
conceive of guys inventing this stuff before PC's.
At first I plotted on pencil on brownline blank charts. To pick up a new
stock all I had to do was go to my old paper last page rack and plot and
leaf back day by day for six months. I gave blue prints of the brown line
to buddies. You can't imagine the mystic at the brokers. Because of my
youthful appearance (14 1/2 appearance out of grad school..lol). I mailed
signatures and money and phoned orders. I was nailing over 10% a month from
the very beginning. Today the rate has picked up a bit.
David Marshall
Thanks for the response. I can feel that this is beginning to take shape.
The TC2000 equations are as follows:
Dry Up 1
1. ((AVGV30 - 3 * AVGV5) > 0) AND (AVGV5 > 0)
Dry Up 2
2. (AVGV30 > 2 * AVGV3.6 AND AVGV30 > 2 * AVGV3) AND (AVGV3.3 - AVGV3) > 0
Dry Up 3
3. (AVGV30 > 2 * AVGV6.3 AND AVGV30 > 2 * AVGV3) AND (AVGV6.3 - AVGV3) > 0
FRV
4. (AVGV5 - AVGV30) > 1000 AND (MAXC126 - MINC126) > 0.5 * MINC126
5. (AVGV5 - AVGV30) > 1000
Gainers Over Yesterday Between 5% and 10% Inc.
6. ((C - C2) / C2) * 100 > 5 AND ((C - C2) / C2) * 100 < 10
Gainers Over Yesterday Greater than 10%
7. ((C - C2) / C2) * 100 > 10
AAA Stage 1 or Stage 3
(H30 < 1.1 * L5) AND (H5 < 1.1 * L30)
AAA Stage 2 or Stage 4
((MAXC126 - MINC126) / MINC126) * 100
Gappers
L > H1 OR H < L1 AND V > 1000 OR (C * V) > 2500
> > Equation 4 gives 128 candidates (limiting the scan to the NASDAQ) but no
> > candidates from lists 1 to 3. (my comment here; I take it you mean eq.
1
> to 3 but I think I see the results above and not all nasdaq)
No, I really did mean equation 4. From a universe of 7400 stocks, the scan
selected 128 stocks by adding the following:
NASDAQ only
65 day ma volume >300k
price >$10
I haven't had chance to add factors for EPS and RS - I suspect that will
cull the list to a managable size. The equations seem to behave reasonably
well in TC2000 v4. I presume that there must have been some boolean function
in v3 that you used for determining cycle phase - unfortunately I have only
ever used v4.
I have used AIQ Trading Expert Pro extensively and its EDS programmable
scanner is very powerful. Unfortunately it is weak on fundamentals. I am
currently using EQ which has programmable quote sheets - great for intraday
monitoring. I am not yet sufficiently familiar with SierraChart but I
understand that it also has powerful programmable scanning abilities.
Regards
David
p.s. I like the aeronautical analogy. My engineering background is in flight
simulation - I also obtained my A&B gliding certificate at 16 but
regrettably did not pursue the hobby. Your previous references to the
hammerhead manouevre brings back memories.
"Jack Hershey" <jhers...@home.com> wrote in message
news:Qpm48.2959$vc.5...@news1.rdc1.az.home.com...
LJay
Could you clarify the mathematical notation used in the equations in your recent
post ?
(Lines marked by ****** denote my comments or questions).
Thanks,
LJay
David Marshall wrote:
> Hi Jack
> Thanks for the response. I can feel that this is beginning to take shape.
> The TC2000 equations are as follows:
>
> Dry Up 1
> 1. ((AVGV30 - 3 * AVGV5) > 0) AND (AVGV5 > 0)
>
> Dry Up 2
>
> 2. (AVGV30 > 2 * AVGV3.6 AND AVGV30 > 2 * AVGV3) AND (AVGV3.3 - AVGV3) > 0
******** Does AVGV3.6 = average volume over 3.6 periods ?
******** Does AVGV3.3 = average volume over 3.3 periods ?
******** In Eq. (2), these two terms are distinct, but similar terms in Eq.
(3) below are identical.
******** Is this correct, or should AVGV3.6 be replaced by AVGV3.3 ?
>
>
> Dry Up 3
>
> 3. (AVGV30 > 2 * AVGV6.3 AND AVGV30 > 2 * AVGV3) AND (AVGV6.3 - AVGV3) > 0
******** Does AVGV6.3 = average volume over 6.3 periods ?
******** In Eq. (3) the "fractional period" average terms are identical, but
in Eq. (2) they are distinct.
******** Is this correct, or should the first (left) AVGV6.3 term be
replaced by AVGV6.6 ?
******** The lack of symmetry between Eq. (2) and Eq. (3) seems to beg for an
explanation.
>
>
> FRV
>
> 4. (AVGV5 - AVGV30) > 1000 AND (MAXC126 - MINC126) > 0.5 * MINC126
******** Does MAXC126 = maximum close over past 126 periods ?
******** Does MINC126 = minimum close over past 126 periods ?
>
>
> 5. (AVGV5 - AVGV30) > 1000
>
> Gainers Over Yesterday Between 5% and 10% Inc.
>
> 6. ((C - C2) / C2) * 100 > 5 AND ((C - C2) / C2) * 100 < 10
******** Does this denote one-day or two-day gainers?
******** If C2 = close for period n-2 then does C = close for period n
******** or does C = close for period n-1 ? In other words,
******** does C == C0 or C == C1 ?
>
>
> Gainers Over Yesterday Greater than 10%
>
> 7. ((C - C2) / C2) * 100 > 10
******** ( see comments for Eq. (6) )
>
>
> AAA Stage 1 or Stage 3
>
> (H30 < 1.1 * L5) AND (H5 < 1.1 * L30)
>
> AAA Stage 2 or Stage 4
>
> ((MAXC126 - MINC126) / MINC126) * 100
>
******** This expression is unlike all of the others because it is
******** neither an equation nor an inequality. How can it be
******** tested to be TRUE or FALSE and used as a filter ?
******** Is this expression simply evaluated and all of the values
******** rank ordered ? If so then how is it used as a filter ?
LJay
David Marshall
see comments below
A"LJay" <goodthu...@home.com> wrote in message
news:3C53E5F0...@home.com...
> David,
>
> Could you clarify the mathematical notation used in the equations in your
recent
> post ?
> (Lines marked by ****** denote my comments or questions).
>
> Thanks,
> LJay
>
> David Marshall wrote:
>
> > Hi Jack
> > Thanks for the response. I can feel that this is beginning to take
shape.
> > The TC2000 equations are as follows:
> >
> > Dry Up 1
> > 1. ((AVGV30 - 3 * AVGV5) > 0) AND (AVGV5 > 0)
> >
> > Dry Up 2
> >
> > 2. (AVGV30 > 2 * AVGV3.6 AND AVGV30 > 2 * AVGV3) AND (AVGV3.3 - AVGV3) >
0
>
> ******** Does AVGV3.6 = average volume over 3.6 periods ?
No.
The notation AVGV3.6 means the 3 day moving average of volume as of 6 days
ago - so it ignores the most recent 5 days. The notation is defined by
TeleCharts 2000.
> ******** Does AVGV3.3 = average volume over 3.3 periods ?
see above
> ******** In Eq. (2), these two terms are distinct, but similar terms in
Eq.
> (3) below are identical.
> ******** Is this correct, or should AVGV3.6 be replaced by AVGV3.3 ?
I have simply pasted Jack's original equations from a post on1999/12/19. The
equations appear twice in that post and also in a post dated 1998/11/27.
There are several typos but I'm pretty sure that the equations that I posted
are correct. As for interpretation, it would be far better to ask Jack.
After closer study, some of the equations are self explanatory, others I am
only beginning to grasp. For example, see Jack's recent response regarding
the isolation of inept fund managers.
> >
> > Dry Up 3
> >
> > 3. (AVGV30 > 2 * AVGV6.3 AND AVGV30 > 2 * AVGV3) AND (AVGV6.3 - AVGV3)
> 0
>
> ******** Does AVGV6.3 = average volume over 6.3 periods ?
No
> ******** In Eq. (3) the "fractional period" average terms are identical,
but
> in Eq. (2) they are distinct.
> ******** Is this correct, or should the first (left) AVGV6.3 term be
> replaced by AVGV6.6 ?
> ******** The lack of symmetry between Eq. (2) and Eq. (3) seems to beg
for an
> explanation.
>
> > FRV
> >
> > 4. (AVGV5 - AVGV30) > 1000 AND (MAXC126 - MINC126) > 0.5 * MINC126
>
> ******** Does MAXC126 = maximum close over past 126 periods ?
> ******** Does MINC126 = minimum close over past 126 periods ?
Yes to both
> > 5. (AVGV5 - AVGV30) > 1000
> >
> > Gainers Over Yesterday Between 5% and 10% Inc.
> >
> > 6. ((C - C2) / C2) * 100 > 5 AND ((C - C2) / C2) * 100 < 10
>
> ******** Does this denote one-day or two-day gainers?
Two day gainers. C is the most recent close, C2 is 2 days ago.
> ******** If C2 = close for period n-2 then does C = close for period
n
> ******** or does C = close for period n-1 ? In other words,
> ******** does C == C0 or C == C1 ?
>
> > Gainers Over Yesterday Greater than 10%
> >
> > 7. ((C - C2) / C2) * 100 > 10
>
> ******** ( see comments for Eq. (6) )
>
> > AAA Stage 1 or Stage 3
> >
> > (H30 < 1.1 * L5) AND (H5 < 1.1 * L30)
>
> > AAA Stage 2 or Stage 4
> >
> > ((MAXC126 - MINC126) / MINC126) * 100
> >
>
> ******** This expression is unlike all of the others because it is
> ******** neither an equation nor an inequality. How can it be
> ******** tested to be TRUE or FALSE and used as a filter ?
> ******** Is this expression simply evaluated and all of the values
> ******** rank ordered ? If so then how is it used as a filter ?
>
I think that these are used to identify the position of each stock within
Jack's 0-7 cycle. I haven't used them yet - I have only recently started my
own study of Jack's method.
Jack clearly made extensive use of TC2000 to scan for stocks using these
equations up until v3. Unfortunately I am a newcomer to TC2000 and have only
known v4. Jack suggests that v4 is no longer useable but I'm not clear why
(Jack?) The functions still seem to be available in v4. If it proves to be
impractical to use v4 then I am very keen to transfer the principles to
another charting package. There are several good candidates with strong
programmable scanning features.
Regards
David
Jack Hershey
explanation and how to do variations etc.
"David Marshall" <davidkma...@hotmail.com> wrote in message
news:IME48.30094$Ph2.5...@news2-win.server.ntlworld.com...
merkat
<davidkma...@hotmail.com> wrote:
>Hi Jack
>Thanks for the response. I can feel that this is beginning to take shape.
>The TC2000 equations are as follows:
>
>Dry Up 1
>1. ((AVGV30 - 3 * AVGV5) > 0) AND (AVGV5 > 0)
>
In this equation AVGV5 >0 means that the moving 5 day average of the
volume should be positive.
This is always the case, there is no negative volume.
the clause should probably read (AVGV5 - XXX > 0),
where XXX stands for some function of volume.
Merkat
David Marshall
"merkat" <cab...@hotmail.com> wrote in message
news:oth85u8pgaloqqjnp...@4ax.com...
Olaf Dietsche
"David Marshall" <davidkma...@hotmail.com> writes:
> Jack clearly made extensive use of TC2000 to scan for stocks using these
> equations up until v3. Unfortunately I am a newcomer to TC2000 and have only
> known v4. Jack suggests that v4 is no longer useable but I'm not clear why
> (Jack?) The functions still seem to be available in v4. If it proves to be
> impractical to use v4 then I am very keen to transfer the principles to
> another charting package. There are several good candidates with strong
> programmable scanning features.
I have no experience with trading and I know neither TC2000, nor any
other charting package. Why do you use such packages? Wouldn't it be
easier to use a SQL DBMS and a script language like perl or basic?
Regards, Olaf.
merkat
<davidkma...@hotmail.com> wrote:
>> This is always the case, there is no negative volume.
>Not necessarily so. The volume could be zero.
Hmm, so what is the difference between a volume of 1 or 100 shares
per day and no shares traded at all? Does the clause (AVGV5 > 0) try
to catch this little piece of noise?
Jack Hershey
I
> am now evaluating. You may be interested to know that the indicators offer
> moving average and macd of volume. It is a simple matter to plot ma5 and
> ma30 volume and I have been trying to correlate crossover with buying
> opportunities - not much success so far.
>
> Any help/advice that you can offer would be greatly appreciated.
I am going to check this out. An MACD of volume is hard to come by in most
software packages.
when you go to a new MACD on something, first go for the overall time span
to connect with the trading cycle. The small number is set up for contrast
with the large around half or less works well. Always bracket your
averaging of this difference with a value that is in-between. It is hard to
conceive of guys inventing this stuff before PC's.
At first I plotted on pencil on brownline blank charts. To pick up a new
stock all I had to do was go to my old paper last page rack and plot and
leaf back day by day for six months. I gave blue prints of the brown line
to buddies. You can't imagine the mystic at the brokers. Because of my
youthful appearance (14 1/2 appearance out of grad school..lol). I mailed
signatures and money and phoned orders. I was nailing over 10% a month from
the very beginning. Today the rate has picked up a bit.
========= WAS CANCELLED BY =======:
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Jack Hershey
I am posting here to clarify some things that apply to the individual
comments you both have made.
General:
As an amateur I trade "natural" cycles meaning short term cycles where the
long 1/2 cycle is 6 to eight days and often a little shorter. There is a
good possibility that the profits may be up to 20% as a potential range.
The other caveat is that trading risk is lowered significantly by trading
only high quality stocks. So I have always only looked at a minimum of high
quality stocks to maintain a good appreciation of capital. I have a select
universe that is adjusted over time. I require a stock to move 20% in 6-8
days at least 5 times every six months. By achieving half the potential that
is there, my standard over 50 trades in three years is 10% in 6 to eight
days per cycle.
I rotate through streams of money where I have enough streams to be able to
focus, in turn, on one stream a day if possible. They do tend to bunch
because of the market influence, however. Because of the nature of the
market at this moment, I have four streams rolling along and will add 1 or
two when the current intermediate and long term trends further bloom. This
is a good time to do O'Neil's rally attempt analysis on the markets to
assure yourself the status of the markets.
Set Up.
I have done this a long time so my methods have changed with the advent of
modern things. From 1957 on I have focused on the way stocks move by looking
at the OHLC and volume expressed in graphical ways. I have always adhered to
the price/volume relationship. Furthermore, I determined that there was no
point in predicting nor forecasting. The alternative to predicting and
forecasting is to anticipate. I, therefore, use a symmetric philosophy of
history where the present is the fulcrum and the past and future are evident
as would be recall and anticipation. I use five key integrated TA constructs
which are unfamiliar to most people: P/V relation, formations, indicators
with first derivative signals, scoring the cycle with three variables, and
fractal pairs for observation.
This thread is focused on the P/V relation and anticipation. I used the
equations here to anticipate the parts of the cycle.
Before you buy part of the cycle.
Before the cycle takes off with the combined thrust of increasing volume,
price rising, and accumulation beginning simultaneously, there is a Dry Up
period. Dry Up is characterized by low volume much below average. From my
universe, I examine the stocks to see where they are mathematically. As
they fall to the bottom of their short term cycle, the volume is the
telltale indicator according to the P/V relation. Therefore, I watch it.
It is decreasing. scoring is 2 then 1 then 0. I am picking up stocks in
the 1 then 0 range. They appear on the lists then drop off. I review the
charts of stocks on these lists.
I am watching them land so to speak.
The math is arranged so the volume is higher in the past and lower in the
present. I put in descent coefficients to adjust the length of each list.
You can see them. Volume is always positive but I did note that
mathematically as a way to satisfy the software folks. You will see over
time that software programmers do not do investing and vice versa. For
years, I did 1 email before open and three after the open within first two
hours. These were forwarded widely I have found. Worden suggested to me
that they would allow a commission to me on the initiation of new clients; I
declined because I am an amateur.
What you see with equations 1 through three is the landing of stocks in
volume prior to their up cycle in price. The advent of mutual funds as a
market influence brought garbage with it. I wrote an equation the have a
gap the volume spikes could move past in a matter of days. The spikes were
random and caused by inept trading. But the stocks were in my universe
because of their reliability for making money. This equation allowed then
to pop onto the list for a day or so. Look ate the offset averages as
depicted by the 3.3 and 6.3.
Use 1 through 3 to set the stock getting to the place where it will be
buyable. This is a key anticipation effort that gives you stocks to buy as
you sell others.
Buy Time.
Before price moves the volume moves. For some reason most people miss
entries. Usually it is because they focus on price primarily. There is a
person here (Uenal) posting now about a method he uses to make vast sums of
money. He focuses on price and is definitely not doing the best.
Dry Up is caused by a vast disagreement on price. Ordinarily, all
transactions are made by people in disagreement. They disagree on
everything but price. But once they no longer can agree on price the volume
of trading dissolves before our eyes. Well what is next?
A force enters the picture, often in the form of new whatever. See O'Neil's
CANSLIM, in particular the N. Mathematically, the anticipatory detection
may be done by volume. The easiest place to see it is on fractal pairs. The
fast fractal of the pair will show you an increasing volume trend right
away. Anticipate on the fast and trade on the slow fractal. Another is my
phone ringing. I used to get calls from execs of corps I had emailed "buy"
on during the open. One ORCL call was about where in the corp I was getting
insider info. The other source is SEC related: if you trade several
accounts (I do) and you enter just before a price rise, the SEC gets on your
tail as they detect you doing this. Letters take care of it, especially
after they get used to reading the same letter from your broker to them.
Equations 4 and 5, and monitoring with pairs of fractals, pass the SEC test
for "insider trading" once your multiple account sizes are sufficient for
their radar. We should get their equations, maybe.
Volume coming up rapidly is the indication in equations 4 and 5. I tucked
in some closing prices there to keep the list short. Notice the
coefficients that help as well.
You must at some point make a major decision involving what you are looking
at. There are some regal turkeys out there making consulting fees for
biggering. Crays etc; it is unbelievable. you have to decide you want a
high signal to noise ratio for investing. this means a small perfect
flawless universe and absolutely no attention paid to anything else. The
turkeys look at everything. And what they see mostly is noise. Filter and
filter until you have very few things to consider. I have a small universe
and still I have to add coefficients to filter. We are looking for strong
signals here.
After buying.
This is the lyrical section. When you are younger I recommend striving a
little. I'll be 70 in a while; just past 69 a few weeks back. Freedom is
best attained by being wealthy. I have freedom on the highway with a V12.
Lets look hard for a moment. The compound interest formula is a basic guide
for us. To strive we optimize. In order of mathematical importance:
minimize cycle time; maximize profit per cycle; and increase capital. In
odd harmonic periodical functions (triangular wave forms), the sinusoidal
components have maximum money velocity at the axis of the function, i. e.,
the middle of the cycle.
So selling is the priority deal in investing. You are striving to get out
of the investment to primarily save time. We are trashing a lot of software
approaches here folks. learn to get over the problem of executing on what
you see the signals telling you. It is not enough to see your sell near or
at a peak, you must consider selling when the money velocity declines. SO
you can get into an investment that is increasing in money velocity.
The rule is, then enter late and leave early. If you had a business
calculator you could run a few 3 year scenarios optimizing cycles and
profits. At the beginning you will not, intuitively, be able to guess what
is best.
As the cycle commences and continues the "herd" joins in and the price
generally accelerates (increasing velocity); we are going to get anaerobic
at some point though. a way of seeing this is the Accumulation/
distribution phenomena. Accumulation begins to poop out. There is a
graphic phenomena too. A plane goes down the runway gathering volume; at
some point enough volume allows and altitude change of lifting off (price
change); several stages of improvement occur; and finally at some point
cruising airspeed is attained and the climb is less steep BUT elevation
change is attained in a shorter time because of speed attainments. At this
point we need to see that an exit is ahead. because we are looking to climb
aboard another ship taking off.
Selling
The last two equations for price gain and the gapper tell you it's time to
get off. You usually have two days to do this. The peaking day in price
and the next day when the buy high sell low crowd is doing their final screw
ups (This includes weekend Barron's subscribers.).
We are trying to get out to get into another fast rising stock. We have
made our half of the run by now, probably. I am recommending you use these
equations to be apprised that the end is very near and to go to close
monitoring to sell out. You will if you strive for a while have to do alot
of transaction per stock. The in to out ratio is 20 to 30 when you are
trading a stock purchase in the low seven digits.
Stages
I divided cycles into four stages so I could just check out parts of my
universe.
LJay; check the TC2000 site for the programming that they do.
regards
jack
"David Marshall" <davidkma...@hotmail.com> wrote in message
news:qpT48.35574$Ph2.6...@news2-win.server.ntlworld.com...
Jack Hershey
Version 3.0 through the y2k period. I guess I still have a fair amount of
cash on credit there. several of us worked long and hard to try to transfer
the stuff into newer versions. We also tried to pickup on using anything to
segway into the future.
The path turned out to be into Excel and Access at first. Then to
convenience and independent ways from TC2000. In TC2000 you do see people
pressing the Reps for info on when TC2000 will get back in the groove.
> I have been experimenting with your TC2000 scans but I am not entirely
clear
> that I understand the process. In your post on misc.invest.futures dated
> 1998/11/27 there are 7 equations. The first 3 I presume scan for Dry Up.
> Should these be used to generate 3 separate lists? What is the principle
> behind the 3 equations? How do I interpret the resulting lists?
The first three are for Dry Up as you suggest. Think of coming into Dry Up
> I assume that the next two equations (#5 and 6) scan for FRV but equation
6
> appears to be identical to the first half of equation 5 so I cannot
> understand why they are listed separately. I expect that there is a
logical
> reason but I can't see it yet.
Well this is just a small practicality. I started withone and added an
adjustment. there's not much difference. I guess I am a hoarder of stuff
it was hard to throw out after people were using it.
>
> Equations 7 and 8 clearly looks for gains of between 5 and 10% and are
used
> to anticpate exit. I think there must be a typo in #6 - should it read <10
> at the end?
Yes these are pre exit indicators. I have gone from one level of investing
to another and each has its own little corrolaries to factor in. It is
important to always be taking money out of the market and use it for stuff.
But you can get behind sometimes. Then you wind up having to fight your way
in and out. So then you need to actually anticipate leaving to be able to
trade into the peak across the peak and, if neccessary down the other side a
little ways all on a given day. The ratio of in to out trades is 2 to 3. I
have had to take over 4 hours on the way out.
From use, I believe the math is right there.
>
> I have added additional criteria such as price>$10 and 65 day ma
> volume>300k. Equations 1,2 and 3 give the following candidates EOD today:
> 1. RA,VRTY,HOTJ,RSG,LRY,SRA,IPCR,BSB
> 2. PDX,NITE,INT,FIF,USPI,STRC,CLKB,BMRN,SLXP,VSNX,PMACA,ATAC,SLMC
> 3. DYN,HOTJ,DTPI,RSG,SPLX,BMRN,SPWX,IPCR,VSNX,BSB
Okay you are using a large universe. Those are good values to keep your
trading running smoothly. I was running universes that were limited through
other means. Largely sector analysis and leader/lagger relationships. The
important aspect of your lists is their length; you are in the groove for
sure.
>
> Equation 4 gives 128 candidates (limiting the scan to the NASDAQ) but no
> candidates from lists 1 to 3. (my comment here; I take it you mean eq. 1
to 3 but I think I see the results above and not all nasdaq)
Give me a hand, I have a chioce of going through a ton of floppies, getting
hung up in TC2000 for some reason they give me on the screen or actually
setting up a computer that is in storage (I can see it easily, though).
Please post the equations by copying and pasting if you will. They can
possibly be used elsewhere than TC2000. I always give away everything as a
way of learning.
I will look at the picks next.
And finally parse the equation set.
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Jack Hershey
"David Marshall" <davidkma...@hotmail.com> wrote in message
news:JKH38.12620$Ph2.1...@news2-win.server.ntlworld.com...
> I am having difficulty finding suitable trading candidates using
> stocktables.com - mainly because most of the stocks with "EPS>90 and
RS>90"
> have volumes that are far too thin. I guess this might be due to current
> market conditions but it is getting very frustrating. I would greatly
> appreciate any guidance that you can give on this - perhaps with an
example
> list. It did pick CACI today which had a spectacular gain of 8.6% but the
> accumulation was -4.
>
both. The three sub lists from the sort to find 7's, 0's and 1's is only
half of what it usually is. These days, I keep some old reliables in my
universe than haven't met this quality test. Our goal is to have a good
selection for rotating and these are thinner times than usual. I have cut
my streams of cash to fewer in number and have put more into each stream.
You have to keep the thin volume out of the picture at all times. I usually
do not get in and out in one block of shares for a given account. I do go
in and out with market trades usually and that is why I get more than one
price for this.
If you can keep several very reliable stocks, that is with respect to their
signals form indicators, you will be able to keep the rotation going fairly
well. I look forward to the broadening of quality selections as well.
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Olaf Dietsche
"David Marshall" <davidkma...@hotmail.com> writes:
> Jack clearly made extensive use of TC2000 to scan for stocks using these
> equations up until v3. Unfortunately I am a newcomer to TC2000 and have only
> known v4. Jack suggests that v4 is no longer useable but I'm not clear why
> (Jack?) The functions still seem to be available in v4. If it proves to be
> impractical to use v4 then I am very keen to transfer the principles to
> another charting package. There are several good candidates with strong
> programmable scanning features.
I have no experience with trading and I know neither TC2000, nor any
other charting package. Why do you use such packages? Wouldn't it be
easier to use a SQL DBMS and a script language like perl or basic?
Regards, Olaf.
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merkat
<davidkma...@hotmail.com> wrote:
>> This is always the case, there is no negative volume.
>Not necessarily so. The volume could be zero.
Hmm, so what is the difference between a volume of 1 or 100 shares
per day and no shares traded at all? Does the clause (AVGV5 > 0) try
to catch this little piece of noise?
>"merkat" <cab...@hotmail.com> wrote in message
>news:oth85u8pgaloqqjnp...@4ax.com. ..
>> On Sat, 26 Jan 2002 20:59:19 -0000, "David Marshall"
>> <davidkma...@hotmail.com> wrote:
>>
>> >Hi Jack
>> >Thanks for the response. I can feel that this is beginning to take shape.
>> >The TC2000 equations are as follows:
>> >
>> >Dry Up 1
>> >1. ((AVGV30 - 3 * AVGV5) > 0) AND (AVGV5 > 0)
>> >
>>
>> In this equation AVGV5 >0 means that the moving 5 day average of the
>> volume should be positive.
>> This is always the case, there is no negative volume.
>>
>> the clause should probably read (AVGV5 - XXX > 0),
>> where XXX stands for some function of volume.
>>
>> Merkat
>
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David Marshall
grips with your method. The fact that is built upon such a solid foundation
appeals to me.
I have been doing a bit more "message mining" since my last post (ring
binder getting fatter). I've managed to resolve the ">" typo so equations
now in place. I'm also clear that 1st 3 are DU, 2nd two are FRV and last 2
are exits.Still not sure why you had 3 DU lists and 2 FRV lists though. I
see that you gave up on TC2000 after the release of v4. Was that because you
could not incorporate an equivalent scan for EPS and RS ranking >90? Do you
rely totally upon stocktables now for finding new candidates?
I've done a little more work on stocktables and compiled a preliminary
watchlist:
RSTN, JDEC, IPIC, OVER, WBSN, HLPA, VRST, AMHC
all of which took a pasting today. :) I thought RSTN might survive but its
pro rata volume dropped dramatically today, way under the 65 day ma. It
seems to have turned south again, heading for the bottom of the channel.
It is certainly a very different perspective watching volume so closely
intraday. Ever since reading "Tape reading and market tactics" by Humphrey
B. Neill, I have been convinced that volume is the answer. I just haven't
been able to get a grip on how to use it - but I think the answer is close.
Kind regards
David
"Jack Hershey" <jhers...@home.com> wrote in message
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merkat
<davidkma...@hotmail.com> wrote:
>Hi Jack
>Thanks for the response. I can feel that this is beginning to take shape.
>The TC2000 equations are as follows:
>
>Dry Up 1
>1. ((AVGV30 - 3 * AVGV5) > 0) AND (AVGV5 > 0)
>
In this equation AVGV5 >0 means that the moving 5 day average of the
volume should be positive.
This is always the case, there is no negative volume.
the clause should probably read (AVGV5 - XXX > 0),
where XXX stands for some function of volume.
Merkat
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Jack Hershey
> On Sat, 26 Jan 2002 20:59:19 -0000, "David Marshall"
> <davidkma...@hotmail.com> wrote:
>
> >Hi Jack
> >Thanks for the response. I can feel that this is beginning to take shape.
> >The TC2000 equations are as follows:
> >
> >Dry Up 1
> >1. ((AVGV30 - 3 * AVGV5) > 0) AND (AVGV5 > 0)
> >
>
> In this equation AVGV5 >0 means that the moving 5 day average of the
> volume should be positive.
> This is always the case, there is no negative volume.
>
> the clause should probably read (AVGV5 - XXX > 0),
> where XXX stands for some function of volume.
>
Either way probably works. the important facet is the duration of the
moving average to be able to trade the "natural' cycle. there are a couple
of other factors as well.
The term is ANDed with another to establish two facet of a condition. You
will also be correct in your comment that both must be positive. The first
term element in the AND, because it has two terms may have any sign value
(one of them is weighted as well). By now you will be able to see more of
what is going on and why things are typed as they are..
Jack Hershey
> On Sun, 27 Jan 2002 21:32:38 -0000, "David Marshall"
> <davidkma...@hotmail.com> wrote:
>
> >> This is always the case, there is no negative volume.
> >Not necessarily so. The volume could be zero.
>
> Hmm, so what is the difference between a volume of 1 or 100 shares
> per day and no shares traded at all? Does the clause (AVGV5 > 0) try
> to catch this little piece of noise?
>
Percentagewise you are talking about big percents. When you slip 0 into a
denominator for any reason it gets to be a big deal. 0 volume on a traded
stock means, in the investing world, that trading has been suspended. This
fits right into the highest category of news. To make it show up in math
analysis always tuck it into a denominator.
Volume just prior to trend price BreakOuts is low. We are using these
equations to generate short lists of stocks that fit into a condition that
is very propitious for making money. The range of volumes is generally set
by a precondition of the stock being part of a universe of excellent stocks
for continually appreciating capital as they are rotated through
periodically. The volumes you are focused upon as an investor do not fall
in this range.
Run a few volumes at MAV30 and MAV5 and drop in a Wilder RSI set to tight
coefficients. when you have adjusted it keenly you will see it drop down
right in between the two MA's. next look and see if there is one extremely
low volume that is way below the DU volume for the stock. If you find
stocks that do that after you have tuned the RSI, then put them on a
permanent short list. about two days after the RSI spike down watch the
stocks and see how important very low volume is.
What you now are looking at personally is a neuroliguistic programming
glitch that you own. You can get rightside up again if you find out what
ails you logically and then try to get your mental statements to create
pictures that are right side up money making wise. The math, for you, will
be another matter.
What you write here is like journaling. If you reply, what's upside down
might show up.
Uenal Mutlu
"Jack Hershey" <jhers...@home.com> wrote in message news:dLB58.14380$vc.22...@news1.rdc1.az.home.com...
>
> Before price moves the volume moves. For some reason most people miss
> entries. Usually it is because they focus on price primarily.
I would say, that it (also) heavily depends on the strategy one uses:
ie. things are totally different if going short opposed to going long.
And most of what is said does apply for the long strategy only, isn't it?
Can these formula also be applied for the shorting strategy?
My current favorite strategy is shorting.
>There is a
> person here (Uenal) posting now about a method he uses to make vast sums of
> money. He focuses on price and is definitely not doing the best.
This is unfortunately not the whole truth. I do use the volume, even twice:
first the AvgVolume, and second the Volume of the last trade day.
But, yes I do not do the same type of (complex) calculations that I'm
doing with the price(s). Meaning: you are right, I could even do the
same type of calculations also with the volume(s). This will, logically
seen, of curse make the whole system then much better and robuster
than without it.
BTW: In some earlier experiments I also used the "Value" of each
stock on that day by calculating Volume*TypicalPrice. IMHO this
opens up even more possibilities for the "right" direction...
> You must at some point make a major decision involving what you are looking
> at. There are some regal turkeys out there making consulting fees for
> biggering. Crays etc; it is unbelievable. you have to decide you want a
> high signal to noise ratio for investing. this means a small perfect
> flawless universe and absolutely no attention paid to anything else. The
> turkeys look at everything. And what they see mostly is noise. Filter and
> filter until you have very few things to consider. I have a small universe
> and still I have to add coefficients to filter. We are looking for strong
> signals here.
9 of the 11 stocks the program picked for today have reached their target.
That is: they went south as was predicted by the program. You can verify
this yourself by encrypting the message (which was posted of course before
the opening of the market). Use the number 295800 which, BTW, was the
last volume of the first of these stocks :-)
You can also inspect the 11 of yesterday how they did... You will be
surprized :-)
David Marshall
Thank you very much for taking the time to provide such a comprehensive
reply. The reasoning behind the equations is now much clearer.
Although the equations appear to function successfully in TC2000 v4, there
is clearly nothing in the scans (yet) to ensure that only quality stocks are
selected. I am experimenting with a additional criteria to emulate the
CANSLIM principle. I have also added filters for minimum 65 day ma volume of
300k, min price $10, and max price $50. The float restriction of 5 to 30
mill shares can be easily applied once the short lists have been carried
into Qcharts. If the resulting scans prove to be workable then I will gladly
post them to this board.
The simple alternative, of course, is to use stocktables.com. Having read
through a number of your earlier posts, I now understand the process of
creating the 1, 0 and 7 lists. I am just a little surprised that stocks with
a negative EPS can get shortlisted as EPS Rank>90 (e.g. RSTN, JDEC, HOTJ). I
appreciate that the ranking is primarily on EPS growth rate but how
important is a positive EPS?
Thanks again
David
"Jack Hershey" <jhers...@home.com> wrote in message
news:dLB58.14380$vc.22...@news1.rdc1.az.home.com...
Jack Hershey
Your post below is very significant and will have far reaching effects for
those who adopt it in whatever form they work. I parsed, below a series of
comments.
> Although the equations appear to function successfully in TC2000 v4, there
> is clearly nothing in the scans (yet) to ensure that only quality stocks
are
> selected.
Yes this is one of the key issues with version 4. Worden is, as of y2k,
mostly oriented to selling data and moving from just EOD to real time or
samples as desired. Before this shift, Worden did create several inovations
prior to y2k that are remarkable. Because Woerden failed to see the future
for data properly they will do a slow fade out of the picture ultimately.
The prima facia example it what will happen in years ahead as indepentent
markets throughout the world are created. Sidney is the kewlest example so
far. Now imagine the next plateau of the boundaries of these markets
dissolving as the global conglomerate emerges as a positive self policing
entity. The emergence of a global economy solves most of our
contemporaneous problems but we won't recognize this until much later.
Alexander's Method deployed in WWII to minimize communications requirements
is a natural part of the global economic emergence. I can see all the
independant Worden data distributor franchises now. Worden should have
focussed on building a software that was designed to make money with free
data from somewhere else. World wise, the "Texas" mentality that we are
occasionally subjected to is not what it will be like.
The BOP of worden is the additional variable to P and V that defines the
market. It turns out to be the definitive Accumulation/Distribution
function descriptor as a stand alone. I have a couple of others that can be
examined some time: they are very delightful and not automated to ant
extent. Welles Wilder's RSI is a hybrid with some A/D in it.
So version 4. screws up because it is designed for gross stuff like the
Cray's strategies, etc. I worked with a few people on this exhaustively.
One of them the coordinator of computer programming and maintenance
operations of American Express. We are high rollers, financially. He
bought a 650,000 home at a cash discount with 25% of his profits on one
transaction we did together; mentoring gets to be fun after a while. We
could not get TC2000 to work in selecting a quality universe over and over
again as you are obliged to do with each new data set. The CANSLIM
innovation of O'Neil is the way to do it with the standards set high enough
to define a standard size. TC2000 V4 and CANSLIM are incompatible as you
will find out. The initial difficulty come from finging the EPS and RS
subparadigms. You can not directly or indirectly get an EPS to work. This
will save you some time.
Being able to load lists of stocks into V4 would be another alternative.
Especially if the BOP could be used in the sorting process.
I have attended Worden workshops and their folk are not tune in but the
audiences sure are!!!
I am experimenting with a additional criteria to emulate the
> CANSLIM principle. I have also added filters for minimum 65 day ma volume
of
> 300k, min price $10, and max price $50. The float restriction of 5 to 30
> mill shares can be easily applied once the short lists have been carried
> into Qcharts.
Yes this part is a thing that can be done. You just can't get the quality
issue resolved.
>If the resulting scans prove to be workable then I will gladly
> post them to this board.
Yes this is the thing to do.
> The simple alternative, of course, is to use stocktables.com. Having read
> through a number of your earlier posts, I now understand the process of
> creating the 1, 0 and 7 lists. I am just a little surprised that stocks
with
> a negative EPS can get shortlisted as EPS Rank>90 (e.g. RSTN, JDEC, HOTJ).
I
> appreciate that the ranking is primarily on EPS growth rate but how
> important is a positive EPS?
If we made a dichotomous key for the important questions that have to be
answered, then the question: Do we have to do this investing with quality
stock?, with the answer Yes, would be near the top of the Q set.
The fundamental reason is echoed through many approaches to making money. I
have assembled these reasons. What is at hand is the reliability of the
stocks to perform and perform on a regular basis. People , in general, do
not look into these matters since they are not written about nor discussed
frequently. Underneath the the goal of making money effectiviely is to have
a straightforward basic system that is in full play 100% of the time. The
key ingredient is to have a universe that performs flawlessly like clock
work. There is no possibility to not have this with 15,0000 or so stocks to
choose from.
My rule to have stocks that move 20% in 6 to 8 days five times in sixmonths
is the distillation of this fundamental concept. I refer to this as the
"natural cycle. Blue chips and the fortune 500, the S&P 500 aren't good
enough for this. I have a contract with a global 500 company to introduce
an overlay on their present market that is 12 times more productive than
their best current market penetration approach. They to me because I was
mentoring an employee who wrecked their performance data. The idea embodied
in quality stocks is a singular point just like how to overlay a system with
an idea that is "out of the box". By going to the "flawless place" of
quality stocks and adding "flawless" performance, you are free to make money
by using optimizing techniques on the compound interest formula. There is
very little getting in your way by this time.
If you have a universe operating on the basis of pulling 10% (half of 20%)
every 6 to 8 days and doing 50 cycles in three years (about 50% of the
usable time), you have the basic stepping off point for striving for a few
years.
I advocate for 8 doublings of a persons effectiveness.
Two of them are above:1. natural cycles; 2. EPS and RS to choose universe.
1. gives you a basic efficiency. 2. gives you a situation wherby the
intermediate and long term channels of these stocks are long. That is the
tide is coming in and they are in the successive stages of the growth part
of a corporate life cycle.
There are from this point six more doublings possible.
Consider cycle compression. Cutting back to 6 days and keeping the take per
cycle in place. 25% more cycles are possible with this alone while still
using only 50% of the time.
There are several ways to strive to relaize the potential of the
opportunity. Make use of the other 50% available. The example of the take
off is important. Some people in airplanes feel that the most altitude is
being gained at take off. This is not true because of the low velocity at
that time. (Pilots are getting the noise away from the ground level
mostly). After a while the velocity increases. And, therefore, a lesser
angle of ascent is possible to actually increase the altitude per unit time.
Equate price and altitude.
When I got out of college I was single and I had worked my way through
college and only borrowed money for grad school tuition. I paid it back in
months and diverted 300 bucks into a brokerage account. For a while I just
kept putting the same amount of money in the account as I used to repay.
Because I hade two part time jobs, a full grad schedule and I taught half
time, I was used to striving and I had an attitude..
By beginning to make money at 10% a month by hand plotting charts, etc, in
1957, I got very used to the idea of making money. I had just one job, a
surplus of income and a subscription to the WSJ and a sixmonth blank chart I
inked on veluum for price and volume. If you plot stocks year after year,
you get your nose into it. It certainly is not a necessity these days,
however.
Today you can just get charts. Today, you can actually watch the market with
key indicators, instead of looking at the WSJ early in the moring before
work. The advent of Xerox was nice. So was the PC.
Lets continue the thread. I am going cruising starting on superbowl day. So
there will be a gap. I think my email works so please copy to my email if
you wish.
regards
jack
David Marshall
Thank you - I think that last post is going to save me a LOT of time.
Just a quick question - hopefully to catch you before you embark.
If a stock has a negative EPS when selected from stocktables.com with EPS
rank>90, would you reject it?
Regards
David
"Jack Hershey" <jhers...@home.com> wrote in message
news:jOV58.16976$vc.27...@news1.rdc1.az.home.com...
merkat
wrote:
Jack,
My simple question was: what is the term (AVGV5 > 0) expected to
achieve in the first equation, which scans for DU volume.
Mathematically it is True when in the past 5 days at least 1 stock was
traded.
It becomes False when trading of this stock was suspended for 5 days,
as you pointed out.
I find your posts valuable and inspiring because you cast your
experience in models and methods, which can actually be used to the
traders advantage. The description of the cycles is quantitative
enough to be put in formulas. This goes beyond the ususal handwaving
which we find in most publications.
I am now trying to put all this together what seems to be quite a
sizable array of insights, rules and procedures. I ask questions to
help me to get the groundwork right.
Merkat
Jack Hershey
> >
> > Before price moves the volume moves. For some reason most people miss
> > entries. Usually it is because they focus on price primarily.
>
> I would say, that it (also) heavily depends on the strategy one uses:
> ie. things are totally different if going short opposed to going long.
Surprisingly not. The market is symmetric vis a vis behavior for the most
part. This, for me is verified by my scoring system. the brokerage firms
do attribute a ratio to the up and down cycles that is not 1:1; for them it
is 27:8 up to down, respectiviely. Philosophically, the only difference in
the trends is the order of the Accumulation/Distribution variable. In
market analysis. very few people are oriented to the variables of the
market. This is the most prevelant financial industry factor at play. The
conventional approach is to apply ideas to making money in the markets.
Ideas are sold to the industry and they perform as expected. Asmptotically
to the performance of the markets. I use the Bogle example to make this
point since a great deal of money is given over to "idea" people. Bogle
created Vanguard. and Vanguard does mutual funds. The three things in the
picture are: Vanguard as a corporation, mutual funds as a method of
investing ; and the performance of the market indexes. Ideas are used by
Vanguard to do the mutual fund thing. If you contest this, then you will
suggest that Vanguard uses higkly paid poeple to do the best they can with
fundamental approaches to investing or you might say they are using their
insights on market performance and acting accordingly (I guess some of
each). This sets the table.
The market approach wins over a ten year period. Here are the annual
results for each of the threeaspects: Vanguard stock average annual return
( 65.95); equity funds managed in mutual funds (13.6%); and S&P 500 index
(16.6%). Ideas are running a few % behind the economic growth shown by S&P
500. Investing with a marekt strategy is the place to be. You have to use
the variables of the market to do this. The three important variables are:
price, volume, and accumulation/distribution.
What kind of ideas do best? Those that are based on market variables
according to the P, V relation. A corrolary must be added to the relation to
make it comprehensive. Those that include the specific aspect of the market
that account for the mood as determined whether buyer or sellers are
dominant. This is unequivacable.
All variables must be handled properly mathematically speaking. There is a
gradation of maths going from simple to complex. there is usually a major
screw up in the approach that is used if a mathemetical idea is the guiding
scheme. The basis of the characterisztion of screw up is: the major
mismatch of the type of math and the type of data used. Market data is not
in the realm of continuous functions. The focus of most indicators (this is
not stock selection) is arithematic and Algebraic expression that simple
dictate a series of arithemetic processes.
For me, then as an amateur, I am restricted to using an approach that
deploys a mathematics based on logical reasoning. This is one hell of a
departure from the norm. I was oriented to this as a consequence of solving
pervasive problem in the design of computers and manufacturing component for
constructin computers. The required exit from vaccuum tubes (I am very old
folks) gave us the opportunity to throw away the RCA vacuum tube manual and
graph paper. I participated at IBM in the process of determining how to
manufacture transistors for what purpose. My orientation was to make one
kind and classify the product by quality. We shipped to TI in Texas on DC
3's the machine to do that.
The specific opportunity to deal with making money evolves around the three
variables of the market. to construe them by assigning values in a
noncontinuous maths drives one to knowing just what is going on for each
variable. Accummulation distribution is the most evident one. It is
determined by direct market behavior with respect to who is playing and
where the control lies. It is the only significant time in human
intercourse where the minority rules. Here you get a glimpse of the purpose
of all the market investment tools that have been invented to trade.
Knowing this limitatin you have to design your approach accordingly.
we see there is either A or D and usually five intensities for each are
chosen. Crudeness or simplicity of treatment drives me to go to the
either/or methodology. I am opporating at a fifth grade level and not
saying this in tongue in cheek. simplicity is not always achieved simply.
the BOP of Worden that uses amplitude modulation is wonderful because it
allow for rate of change of intensity ultimately.
The pinnacle of the decision making regarding the selection of the
approprate maths is the statement of the P, V relation. It is a trend
analysis statement. This has not reached the financial industry and
mathematicionas with ideas as yet. It is unbelievable to me.
Uenal, you come from a mathematical persuasion related to gambling. Since I
taught mathematics for a while I was plagued by student's inherent
dipositions towards probability. So I have done the gambling thing as a
once over lightly. In application, I have rolled consecutively, as a
demonstration, 2 through 7 with two die. And my black jack Las Vegas dealer
change rate reaches 4 per hour using 5's theory from "beat the dealer",
invariably I piss off other players but I do slide winnings to adjacent
players as a rule. Gambling is finding needles in haystacks. I am of the
burn the hay and use a magnet persuasion. We need to get rid of chaff and
focus with proper tools on the goal of making money.
So I use Boolean algebra as the key to the approach. You see it in the
equations indirectly and the scoring with three variables is a direct
application. Each part of the cycle has a csore and all formation used in TA
can be assested using the P,V relation and its corrolary. All straight
Booean algebra where arithematic is used to establish the trend for the
application of Boolean algebra.
We are at a place where switches need to be set in one of two positions, and
the combination of switches tells us where we are.
A six month run using C language yields the following in terms of the
compound interest formula. The run is real treading using real stocks
selected from a real universe. Furthermore it was done by a person using
this approach whom I had never met until he gave me the software and gave me
his trading record. We are pseaking about performance before optimization
was begun. The simple result is 6.6 days average hold cycle and 11.1 %
profits per cycle.
> And most of what is said does apply for the long strategy only, isn't it?
No the market is symmetric and likewise so are the analysis techniques The
reversal occurs at Price up, volume down, and distribution; going to price
down, volume up, accumulation. In decimal 4 to 3 and in binary 1 0 0 to 0 1
1. The binary trend scores are in the order P, V, A/D to be able to realte
the frequency trend change of each of the three during a cycle: P=2 (up and
down), V=4, and A/D=8.
> Can these formula also be applied for the shorting strategy?
use 1, 2, and 3 as is. 4 and 5 use the volume and turn the price stuff
upside down. 6, 7 turn upside down. Use the gappers and select out the last
half of the list it is the gap downs.
> My current favorite strategy is shorting.
Getting neutral biased is something that takes a while. You will have to
spend some time on this.
Your form of advocacy is a damaging thing at this point. It evolved from
what is being impressed upon you by others and you're choosing to not flee.
What was left was fighting which, now, you find safe because you have spent
so much energy in the learning process. The consequent safety is more and
more pervasive as a haven for you.
the two activities you could best carry out at this point are: 1. reviewing
all your posts. 2. copy and list each first sentence. 3. note the
corresponding Neuroliguist picture. 4. write the thought that get a picture
that is the one you originally wanted not the opposite one that you got in
2. This is difficult to do. You have caused such an impact as you reach
outward from your safe haven that it has reached, at this point into your
"original thinking". To be in a defensive mode as a normal stance is not
optimal.
In the past short time you have had an amazing opportunity to be helped by
skilled people on investing and in programming. Many were very reluctant to
give up helping you. If you make the effort on your first sentences, then
you can start in on the subordinate ones that are kinderd and focused on
other's ideas. finally you can begin to write stuff down occassionally that
comes to mind along these lines.
The above may seem harsh. I am less than your peer in many ways but I am
proactive and creative. I am suggesting something quite positive that comes
from something that you put on the table. I do not initiate stuff, but I do
try to go to where a preson is and draw them to a place I know about that
works.
Naturally I exhaust everyone with the labor required to read what I say in
an uneditied manner.
>
> >There is a
> > person here (Uenal) posting now about a method he uses to make vast sums
of
> > money. He focuses on price and is definitely not doing the best.
>
> This is unfortunately not the whole truth. I do use the volume, even
twice:
> first the AvgVolume, and second the Volume of the last trade day.
> But, yes I do not do the same type of (complex) calculations that I'm
> doing with the price(s). Meaning: you are right, I could even do the
> same type of calculations also with the volume(s). This will, logically
> seen, of curse make the whole system then much better and robuster
> than without it.
Well you have to smile here. Cross out the first sentence which creates a
picture : the whole truth
Replace it with: I can add more to the truth of what you have said.
Yes!!! you are beginning the process of making your system robust!! As you
burn down the haystack ( by filtering and such to reduce the amount of
candidates) and get into the specific manner of amplifying the merits of
your selection, it can only get better. Your math ideas are going to sooner
or later yeild to the behavior of the market as a foundation. This is an
iterative process of refinement.
>
> BTW: In some earlier experiments I also used the "Value" of each
> stock on that day by calculating Volume*TypicalPrice. IMHO this
> opens up even more possibilities for the "right" direction..
you will be able to use this as a confirmation of choice; it will occur
after entry and be a substantive test of the fact that "a failure to
breakout" has NOT occurred. One of the damning things of a lot of systems
is to not anticipate that a failure to break out has ocurred. You assure
this before entry by introducing measures that detect what I call "flaws";
it is flaws that are present that cause subsequent "failures to Breakout".
This is not a pendantic point at all. It is always clear why there are
failures to breakout. The lack of accumulation is a classic precursor of a
failure to breakout in the beginning of a potential trend. There is a
"backing up in scoring that illuminates flaws that get cured. Look to head
and shoulders formation and double bottoms/tops and the handle of the cup
and handle.
>
> > You must at some point make a major decision involving what you are
looking
> > at. There are some regal turkeys out there making consulting fees for
> > biggering. Crays etc; it is unbelievable. you have to decide you want a
> > high signal to noise ratio for investing. this means a small perfect
> > flawless universe and absolutely no attention paid to anything else.
The
> > turkeys look at everything. And what they see mostly is noise. Filter
and
> > filter until you have very few things to consider. I have a small
universe
> > and still I have to add coefficients to filter. We are looking for
strong
> > signals here.
>
> 9 of the 11 stocks the program picked for today have reached their target.
> That is: they went south as was predicted by the program. You can verify
> this yourself by encrypting the message (which was posted of course before
> the opening of the market). Use the number 295800 which, BTW, was the
> last volume of the first of these stocks :-)
>
> You can also inspect the 11 of yesterday how they did... You will be
> surprized :-)
The fact that you are setting your targets in the way you are can definitely
be improved. you have two misses on the low side and 9 on the high side.
You are on a putting green with eleven balls. Three points come up here.
1. You were short on two. Why?
2. You gave up profits on 9 for an arbitrary reason. What was the reason?
3. This is a little difficult. e have to look at something big here. Why
do you choose to be putting? My example is not a bout putting exactly. It
is about why go putting? Is there any reason for setting a profit goal?
there is certainly a reason for knowing that there is potential to make
money. But no reason to predict or forecast it.
We are now in the investment monitoring and the use of funds to optimize
capital appreciation. You will se a lot of chat here about money
management; about loosing money and about risk management. the side of the
coin that is most important is to be optimizing making money. One of your
"not possible trades to do recently" was IMCL. Many people told you some
stuff about what is possible trading short and you are not able to process
it mentally at this point.
You may consider from the above data that you are being told to drop the
target stuff from a price viewpoint. You do need a substitute. The
transition form where you are to a good place will take you several steps it
looks like. Money velocity is a good easy place to start. First it will
force you to upgrade your selection process. Second it will easy you into
making more money than you can now. Once you have cleared up the warm up
drill you can get to the optimizing which lies in the time part of your
software. Timing is more important than any thing and so far you have not
entered any stock that has passed any failure to breakout tests not the
"flaw" precursors for that.
All of my comments are from analyzing each and everyone of your selections
and arbitrarily making more money then you do on them. I have many
advantages to to that so it is not a criticism of your work in process.
Jack Hershey
> Hi Jack
> Thank you - I think that last post is going to save me a LOT of time.
>
> Just a quick question - hopefully to catch you before you embark.
> If a stock has a negative EPS when selected from stocktables.com with EPS
> rank>90, would you reject it?
Absolutely. I don't know how to use a larger font or make it bold. if you
will please do that to Absolutely.
Profits are the stabilizing force of regularity in a corporations progress
in the market place. They help to stay in business too. We are glued to
the market, however. We want stocks that have a lots of fiber in their
diet.
David Marshall
Thanks
David
"Jack Hershey" <jhers...@home.com> wrote in message
news:96Y58.16996$vc.27...@news1.rdc1.az.home.com...
Jack Hershey
>
> My simple question was: what is the term (AVGV5 > 0) expected to
> achieve in the first equation, which scans for DU volume.
> Mathematically it is True when in the past 5 days at least 1 stock was
> traded.
> It becomes False when trading of this stock was suspended for 5 days,
> as you pointed out.
>
> I find your posts valuable and inspiring because you cast your
> experience in models and methods, which can actually be used to the
> traders advantage. The description of the cycles is quantitative
> enough to be put in formulas. This goes beyond the ususal handwaving
> which we find in most publications.
>
> I am now trying to put all this together what seems to be quite a
> sizable array of insights, rules and procedures. I ask questions to
> help me to get the groundwork right.
>
> Merkat
Thanks for your reply. the best thing to say about the term is that it
makes it necessary for the preceding term to be bigger by a factor of three
( in the left part of the expression). The term alone, as it is, looks like
nonsense. You can see, perhaps I was using and inequality in between where
the AND is at one point and for some reason in the evolutionary process I
replaced the > with the AND and neglected housekeeping. I believe the
equations are correct, if you slip in an > it might help out maybe for
landing purposes. If you do, it means the descent has to be sufficient to
be considered. Below 3 times the 5 day term it gets cut out. This is a way
of eliminating the long term dry ups caused by plain lack of interest in the
stock. As I rock along in life now, I am noticing things aren't so swift
mentally any more. But it's all alot of fun.
I can see you are striving to use your talents to refine your approach; I
believe it will really pay off for you. People get neat breakthroughs by
building on other stuff and also by replacing the existing with
improvements.
It's almost frightening when you use this stuff in commodities. It goes both
ways 50 times faster and is leveraged.
regards
jack
Uenal Mutlu
"Jack Hershey" <jhers...@home.com> wrote in message news:E0Y58.16994$vc.27...@news1.rdc1.az.home.com...
>
> > 9 of the 11 stocks the program picked for today have reached their target.
> > That is: they went south as was predicted by the program. You can verify
> > this yourself by encrypting the message (which was posted of course before
> > the opening of the market). Use the number 295800 which, BTW, was the
> > last volume of the first of these stocks :-)
> >
> > You can also inspect the 11 of yesterday how they did... You will be
> > surprized :-)
>
> The fact that you are setting your targets in the way you are can definitely
> be improved. you have two misses on the low side and 9 on the high side.
> You are on a putting green with eleven balls. Three points come up here.
>
> 1. You were short on two. Why?
?
All the 11 selected were for short selling. 9 of them were good.
> 2. You gave up profits on 9 for an arbitrary reason. What was the reason?
?
The opposite is true. 9 of the 11 made profit, the other 2 lost about 2%.
Sorry, seems we are talking of different interpretations of these results.
> 3. This is a little difficult. e have to look at something big here. Why
> do you choose to be putting? My example is not a bout putting exactly. It
> is about why go putting? Is there any reason for setting a profit goal?
> there is certainly a reason for knowing that there is potential to make
> money. But no reason to predict or forecast it.
It is necessary for the simulation only for testing different scenarios, and
also for testing the automatic case (that's "what happens if"): ie. do the
trade and simply close it at evening without watching the market the whole
day. Of course, in real trades, one can exit whenever he/she likes.
> We are now in the investment monitoring and the use of funds to optimize
> capital appreciation. You will se a lot of chat here about money
> management; about loosing money and about risk management. the side of the
> coin that is most important is to be optimizing making money. One of your
> "not possible trades to do recently" was IMCL. Many people told you some
> stuff about what is possible trading short and you are not able to process
> it mentally at this point.
:-)
Oh, Jack, the program worked very well for IMCL (cf. all the postings written,
incl. your own analysis of IMCL. Don't you remember, that it even fell 40%
whereas your analyis unfortunately said something very different?).
Maybe we have a different interpretations of what "shorting" is...
> All of my comments are from analyzing each and everyone of your selections
> and arbitrarily making more money then you do on them. I have many
> advantages to to that so it is not a criticism of your work in process.
Yes, I know that the results can be made even much better by optimizing them.
But, first things first... I have enough time to improve it and to play different scenarios.
Jack Hershey
"Jack Hershey" <jhers...@home.com> wrote in message
news:E0Y58.16994$vc.27...@news1.rdc1.az.home.com...
>
> > 9 of the 11 stocks the program picked for today have reached their
target.
> > That is: they went south as was predicted by the program. You can verify
> > this yourself by encrypting the message (which was posted of course
before
> > the opening of the market). Use the number 295800 which, BTW, was the
> > last volume of the first of these stocks :-)
> >
> > You can also inspect the 11 of yesterday how they did... You will be
> > surprized :-)
>
> The fact that you are setting your targets in the way you are can
definitely
> be improved. you have two misses on the low side and 9 on the high side.
> You are on a putting green with eleven balls. Three points come up here.
>
> 1. You were short on two. Why?
?
All the 11 selected were for short selling. 9 of them were good
****** by short I meant that they failed to make any money Short of making
money whether they were long or short.
> 2. You gave up profits on 9 for an arbitrary reason. What was the reason?
?
The opposite is true. 9 of the 11 made profit, the other 2 lost about 2%.
Sorry, seems we are talking of different interpretations of these results.
******* Okay let me say it differently. Your targets were not large enough
to make the optimum amount of money that was on the table. If you are
spending the same time investing you must, I believe take all the money
available in that time period to appreciate capital most effectively. Since
you choose targets that do not do this you have failed to pick the best
target.
You conventionally give yourself points for achieving something. You are
not able to give yourself points as yet for using the time your money is in
the market wisely. you exit wrongly and the selection keeps making money
during the time you prematurely left the market and cannot reenter to make
more money with anything at all. You have a time gap in your approach that
is not working for you because of the handicap you have established.
> 3. This is a little difficult. we have to look at something big here.
Why
> do you choose to be putting? My example is not a bout putting exactly.
It
> is about why go putting? Is there any reason for setting a profit goal?
> there is certainly a reason for knowing that there is potential to make
> money. But no reason to predict or forecast it.
It is necessary for the simulation only for testing different scenarios, and
also for testing the automatic case (that's "what happens if"): ie. do the
trade and simply close it at evening without watching the market the whole
day. Of course, in real trades, one can exit whenever he/she likes.
*******It is important for anyone to understand that a test succeeds or
fails on the amount of money it makes. Out of 11 items tested you missed 11
times with your simulation. People think of this as a problem as they see
you working. The ones that did not make the target were poor places to put
money. The ones that you simulated that made more than you targeted show
that your target approach is not acceptable at this point because you loose
time making money by the approach you use. At this point you will think,
"What does anyone expect, I have only begun to work on this?" What they
think is yes, you have only begun to work and the necessity of setting
targets must be important to be able to select proper stocks. And they also
think, why not do the targeting and then have a way to modify it easily to
make the most money after the selection because that task is so simple.
They might say even"Why doesn't he just keep a stock he's in until another
one exceeds the potential of the one he's in and just switch right then and
there." The IMCL example is a classic.
> We are now in the investment monitoring and the use of funds to optimize
> capital appreciation. You will se a lot of chat here about money
> management; about loosing money and about risk management. the side of
the
> coin that is most important is to be optimizing making money. One of your
> "not possible trades to do recently" was IMCL. Many people told you some
> stuff about what is possible trading short and you are not able to process
> it mentally at this point.
:-)
Oh, Jack, the program worked very well for IMCL (cf. all the postings
written,
incl. your own analysis of IMCL. Don't you remember, that it even fell 40%
whereas your analysis unfortunately said something very different?).
Maybe we have a different interpretations of what "shorting" is...
***** Kewl observation. You took a part of the 40% . I am suggesting that
you take 40%; it will enhance your performance to an extent. Also you have
to consider what is available to use to short. My analysis said it was
flawed for shorting and in fact for me looked like a potential long. It was
flawed as a long as it turned out when I placed my entry stops. There is a
possibility on this stock that the news came into the mix of things.
Whenever news is an element, it is factored in favorably
by timing issues and market stops.
> All of my comments are from analyzing each and everyone of your selections
> and arbitrarily making more money then you do on them. I have many
> advantages to that so it is not a criticism of your work in process.
Yes, I know that the results can be made even much better by optimizing
them.
But, first things first... I have enough time to improve it and to play
different scenarios.
Yes as Alex said, you are moving into a four step process. Eliminating
scenarios from a selection of different scenarios is the beginning of that
process from your point of view. Going with the original rendition did look
like a starting point, however. First selection and then a fixed set of
bounds up and down and a time limit were quite elegant as a first cut. The
aspect of always getting longs was a strong point as well. The ratios of
targeted exits, time outs and failures were really exceptional. Since the
time out period was the most powerful variable, I was hoping to see it
optimized first. The original symmetry of the stops in a long biased
paradigm was working very much to the investor's advantage as well.
Using a risk strategy like Don, Mike, JT Roberts and Olaf are discussing
would really enhance the downside risk stop settings or, alternatively, it
is a great way to back into the amount of capital to put into one, then more
streams of differing selections as the capital builds.