Proper approach to trading?
Tago
market, shouldn't traders spend most of their time *in* the market? The
only timing that one should be doing would be to avoid the drops, rather
than try to buy before the market rises. All the "traders" and "timers" may
have the wrong default position. When in doubt you should be *in* the
market. Has this occurred to anyone else here?
con...@inow.com
over 20% of its value in just one day, and made a good chunk of it
back in the next week, and then just deteriorated through 1931, by
which time it lost just under 90% of its value-which it didn't make
back until 1956. (The loss in market capitalization was bad, but when
compared to asset deflation over the same period-about 60%-it was
almost insignificant as to effect on the general economy.)
Such collapses are not rare-in 1997 the Asian Contagion had almost the
same numbers, (but operated almost twice as fast,) and effected about
a third of the world's economies.
Not to mention Latin American contagions of the 1990's, too.
Although you are correct that, historically, markets do go up most of
the time, when they go down, most investors loose about all they made
over the previous decades.
Making money in equity markets is easy. Keeping it is the hard part.
John
BTW, the quantitative analysts that study the dynamics of markets have
a lot of trouble seeing the "new economy." They have seen it
before. Most think that it is not a question as to whether a contagion
will occur in the US, but when, (although this is not a statement that
one is imminent-it might, or might not be.) If you want, and if you
have access to an equity market historical database, (Yahoo!'s will
do,) scale the last 28 years of the DJIA's daily closes, and overlay
it with 1900-1928. The current market prosperity we have had for the
last decade, or two, is simply not that unusual. The rate of increase
in capitalization, is about the same over both periods, (and there are
more such instances thoughout the 20'th century.)
--
John Conover Tel. 408.370.2688 con...@inow.com
631 Lamont Ct. Cel. 408.772.7733
Campbell, CA 95008 Fax. 408.379.9602 http://www.johncon.com
Jack Hershey
I looked at the market and the traders. There is hardly any stock around
that someone is not "in". So I looked further at two things that seem to
affect the market. The amount of money in the market and the # of investment
items available to put mony into. It looks like the market capitalization
is growing faster than the # of items there are available to buy.
I know you have a "default setting" for investors that you prefer. An
enjoyable exercise for you to do might be determing how frequently people
"reset" to "default". I do "reset" about every six to eight days on the
average. This is because I am unable to hold stocks that are declining in
price and I only like to buy stocks that are going up just as they begin to
go up.
If you made a chart a few coloumns wide you could appraise how often
"resetting" to "default" affects money making. These are great column
headings: Bar duration, average channel price hi/lo difference as shown in
the channel of price movement, hi/lo % of mid chanel value, # of lo to hi
crossings per year, Profits per year for only half the hi/lo % times the
crossings, profits per year if compounded.
As you change bar durations you will see the ups and downs on several
levels. You can add a "buy and hold" row just for laughs at the top. This
table will be fun for you to do; I hope it raises a question for you. the
question is: How does one optimize capital appreciation in any market? It
is a fun question; I have been working on the answer since 1957. And it is
fairly staightforward to pile the optimizations into groups where each group
doubles your ROI successively. I have about 8 groups. You will easily be
able to see several doublings occuring as you fill in the chart.
The buy and hold ROI you have as a starting point makes it even easier.
"Tago" <tago...@home.com> wrote in message
news:o1%p5.6443$Z4.1...@news1.rdc1.tn.home.com...
Don Cameron
<jher...@primenet.com> wrote:
>
>I know you have a "default setting" for investors that you prefer. An
> I do "reset" about every six to eight days on the
>average. This is because I am unable to hold stocks that are declining in
>price and I only like to buy stocks that are going up just as they begin to
>go up.
>
Jack, you have explained to us that your default method, assuming
things go like clockwork, for getting out of trades near the tops of
their cycles is to sell early in the day after the volume peaks.
However, how do you deal with selling when things do not go like
clockwork and the stock flames out soon after starting to rise in what
appears to be a new half-cycle.
A good current example is MOGN. It had a pullback accompanied by a
dry-up in volume and started a new rise on a good volume surge
yesterday. There was great follow-through this morning, but it turned
sour this afternoon and closed in the lower part of today's range,
even though the volume was higher than yesterday. The market makers
made decision making difficult by often maintaining a spread of about
75 cents in the later part of the day.
After peaking at noon it showed "4 o'clock drift behaviour" which you
normally suggest is not too troublesome. However, the drift became a
sink after about 2 p.m., by which time a large part of the intraday
profit was lost.
So, would you still be a holder because the volume remained high or
would you have sold this afternoon? If so, what rules and criteria
would you apply for getting out of this and other potentially failed
trades?
Jack Hershey
This won't take long to go over, but you will find some superfulous stuff
here that I've slipped in so as not to be too brief for others who might
track through this decription.
MOGN has as of JAN 00 moved into a second level of corporate progress. the
ups and downs now are accompauied by a volume and volatility combination
that make a lot of money for the short trem cycles. Five such show up for
the last six months so it is a fair stock to have in a universe. As it came
into its own you would have held it in a significant intermediate trend from
the beginning of the year until you sold it in less than two months for 4 to
5 hundred percent gain as an unusual intermediate term run.
Now MOGN is a real producer in a 12/20 = 60% channel. Use a daily chart to
get the three points to set up the channel. The lower left point (1) is in
the prior down (short) channel that ends with first quarter news it looks
like. The may peak is point 2 to establish the top beginning level of the
channel. Point three, to establish the lower side of the channel is the
trough in late May. Connect points 1 and 3 and then clone a parallel line
through 2 to see the 60% channel.(12 points wide at 20 dollar value.)
At the beginning of this intermediate trend channel, set your volumes for
DU, FRV and Peak. I draw three rays from typical values and they just ride
along the dailies forever. shape vup your MACD (5 13 6) values. to see what
daily and 30 bar chart values are expected during the short term trends a
cross the channel that you are going to trade.
Here you can decide if you want to slip into a faster money making pace.
You can pull down 25% on this stock in four days usually it looks like.
from your query it looks like you have perceived this and are operating on
that capital appreciation level which is a good choice for you and others of
your persuasion.
Most of the above, then becomes a healthy background in which to play.
notice we have to get the stops straight on this stock no matter what pace
of capital acquisition you choose. Do this in two steps. for onventience
use the 30 min bars and sweep along through the current intermediate trend
giving regard to how fast prices change by looking for the overall envelope
of the MACD. it is +/- 1.00. So that is where you will stop out if you set
your stops closer than 125 % of the price draw downs when MACD hits -1.00 in
the up intermediate trend. Pop back up to the dailies and you will see
several draw down days where long and low bars occur due to trading in poor
block sizes on the part of niave market order persons.
Since you are going to pull profits in shorter periods on the present trend
we need to be sure that you don't get stopped out during one of these strong
short upswings and on the other hand you do exit at the short term peak.
So the trading fractal for you will naturally be 30 min bars instead of
daily bars. the anticipatory fractal for the 30 min will be the 5 min bars.
So add another MACD examination to the analysis. The 5 min MACD envelop is
+/- 0.5. You found that on the move that was occurring along about 7AUG
through 12AUG ,inbetween MOGN was showing you the DU characteristics.
All of this is telling you that there a two point runs and pull backs within
the short term trends.
I am going to explain the rest precicisely from the money making point of
view now that we have the climate of the trading established and we know
what the magnitude of the signals are.
I want you to hold when you are in a dull situation as you described. If
you see more and more the absence of signals to keep holding, then you take
profits and go to cash if nothing else is available to slip into
immediately.
Here is the borderline to look for. If you are in a trend like MOGN, then
you see the MACD is continuing its improvement from the '0" breakout up on
Monday. it is off the ground and diverging. Once it is up and "away" rom
"0" you are trending. it will go up and this means the trend is
accelerating. As the ttrend gets to 0>5 on the 5 min bars, you know that it
is growing as well as you can expect. The fast line you know will peak on
0.5, you figured that out. So what if it comes off the peak and entwined
with the slow line and remains "away" from the"0", you are making profits
because it is + meaning there is an upward price trend.
Here is where you make a decision. if the entwining stops and there is a
divergence down of the fast MACD line. that is the ball game. Within 15
imnutes or so with those lines diverging and spread, there will be a BO
down. Worse, whern those MACD lines hit "0" you are beginning a negative
short down trend.
Here are some other signals that match right in. The right line is broken,
a flat bottom pennant forms, volume pops back up as the pennant point
arrives.
If you decide to hold at these points and not take a profit that is okay.
But move back to the slower fractals (daily and 30 min) and trade there over
several days.
Using the 30 and 5 min fractals is not day trading at all. What it is is
just using a portion of the intermediate term channel to make a lesser short
term trend work for you instead of going all the way across for the 60%
gain.
Use the max peak values of MACD to be a guide for the factal you are using
for anticipation. I did both for you.
MOGN had a BO down as you say. Now it is going back up from the MACD
bottom. Tomorrow AM you can glue onto the 5 min MACD and see it lift across
the "0". Then go to the 30 min and use it as the fast fractal for the
daily. The MACD will follow suite on the 30 and in a few hours it will come
above "0" after a little time "near "0" like on the 21 AUG. If the 30 chart
begins to look like the 23 AUG, then you better go back onto the 5min chart
and make the exit when the MACD comes off its highest values diverging.
These two scenarios are the likeliest. the 21st one leads you up nother 3
points. The 23rd takes you out no lower than the place you are now.
regards
jack
"Don Cameron" <donald....@sympatico.ca> wrote in message
news:gh6oqsgvb93veq3om...@4ax.com...
Don Cameron
liberty of copying my question and your response to my bulletin board,
together with the daily, 30-min and 5-min charts.
These can be found at
I have some supplementary comments and questions if you would indulge
me a little longer. They appear at intervals in your response below.
On Tue, 29 Aug 2000 15:40:15 -0700, "Jack Hershey"
<jher...@primenet.com> wrote:
>Hi Don,
>
>This won't take long to go over, but you will find some superfulous stuff
>here that I've slipped in so as not to be too brief for others who might
>track through this decription.
>
>MOGN has as of JAN 00 moved into a second level of corporate progress. the
>ups and downs now are accompauied by a volume and volatility combination
>that make a lot of money for the short trem cycles. Five such show up for
>the last six months so it is a fair stock to have in a universe. As it came
>into its own you would have held it in a significant intermediate trend from
>the beginning of the year until you sold it in less than two months for 4 to
>5 hundred percent gain as an unusual intermediate term run.
>
>Now MOGN is a real producer in a 12/20 = 60% channel. Use a daily chart to
>get the three points to set up the channel. The lower left point (1) is in
>the prior down (short) channel that ends with first quarter news it looks
>like. The may peak is point 2 to establish the top beginning level of the
>channel. Point three, to establish the lower side of the channel is the
>trough in late May. Connect points 1 and 3 and then clone a parallel line
>through 2 to see the 60% channel.(12 points wide at 20 dollar value.)
>
I have included the trendlines in the chart posted at Coolboard, which
also includes the MACD 5,13,6 and a 5 day MA of volume.
>At the beginning of this intermediate trend channel, set your volumes for
>DU, FRV and Peak. I draw three rays from typical values and they just ride
>along the dailies forever
I am not sure I understand this. Do you mean you draw horizontal
lines on the volume part of the graph representing these values?
> shape vup your MACD (5 13 6) values. to see what
>daily and 30 bar chart values are expected during the short term trends a
>cross the channel that you are going to trade.
>
Done. I note that the daily MACD is not very sensitive, perhaps
because of the extreme trough in April compressing the scale. I note
that it produced a relatively timely signal for the late May rise, but
that the current surge has not been sufficient to clearly break it out
of entwining.
>Here you can decide if you want to slip into a faster money making pace.
>You can pull down 25% on this stock in four days usually it looks like.
>from your query it looks like you have perceived this and are operating on
>that capital appreciation level which is a good choice for you and others of
>your persuasion.
That is the hope.
>
>Most of the above, then becomes a healthy background in which to play.
>notice we have to get the stops straight on this stock no matter what pace
>of capital acquisition you choose. Do this in two steps. for onventience
>use the 30 min bars and sweep along through the current intermediate trend
>giving regard to how fast prices change by looking for the overall envelope
>of the MACD. it is +/- 1.00.
With my data source (quote.com livecharts) I can only produce a chart
back to AUG 16 on the 30-min scale and the envelope is +1 to -0.5,
with the +1 being hit only briefly today. Are you able to look at a
wider range of data?
>So that is where you will stop out if you set
>your stops closer than 125 % of the price draw downs when MACD hits -1.00 in
>the up intermediate trend.
So I have to be prepared to allow it enough slack that MACD can go
down to -1 without my stop being hit? I am not sure how I would
determine this in advance as the MACD trough is a function of both the
size and velocity of the decline. Could you clarify please?
> Pop back up to the dailies and you will see
>several draw down days where long and low bars occur due to trading in poor
>block sizes on the part of niave market order persons.
>
I am afraid you will have to spoonfeed me here. Could you identify a
few of these days please as I do not know what I am looking for.
>Since you are going to pull profits in shorter periods on the present trend
>we need to be sure that you don't get stopped out during one of these strong
>short upswings and on the other hand you do exit at the short term peak.
>
>So the trading fractal for you will naturally be 30 min bars instead of
>daily bars. the anticipatory fractal for the 30 min will be the 5 min bars.
>So add another MACD examination to the analysis. The 5 min MACD envelop is
>+/- 0.5. You found that on the move that was occurring along about 7AUG
>through 12AUG
Again, my data sources do not allow me to see this. What source do
you use to see back that far on a 5-min scale?
> ,inbetween MOGN was showing you the DU characteristics.
>
>All of this is telling you that there a two point runs and pull backs within
>the short term trends.
>
>I am going to explain the rest precicisely from the money making point of
>view now that we have the climate of the trading established and we know
>what the magnitude of the signals are.
>
>I want you to hold when you are in a dull situation as you described. If
>you see more and more the absence of signals to keep holding, then you take
>profits and go to cash if nothing else is available to slip into
>immediately.
>
>Here is the borderline to look for. If you are in a trend like MOGN, then
>you see the MACD is continuing its improvement from the '0" breakout up on
>Monday. it is off the ground and diverging.
If this is the daily MACD you need a fine eye to see it. To me it is
barely out of entwining and by no means conclusive. The 30-min MACD
clearly broke out but is heading back to zero and is nearly there.
The 5-min has been mailny negative since 1:45 p.m.
> Once it is up and "away" rom
>"0" you are trending. it will go up and this means the trend is
>accelerating. As the ttrend gets to 0>5 on the 5 min bars, you know that it
>is growing as well as you can expect. The fast line you know will peak on
>0.5, you figured that out. So what if it comes off the peak and entwined
>with the slow line and remains "away" from the"0", you are making profits
>because it is + meaning there is an upward price trend.
This I understand.
>
>Here is where you make a decision. if the entwining stops and there is a
>divergence down of the fast MACD line. that is the ball game. Within 15
>imnutes or so with those lines diverging and spread, there will be a BO
>down. Worse, whern those MACD lines hit "0" you are beginning a negative
>short down trend.
This is exactly what happened at 1:30 p.m. today. Are you saying I
should have acted on this signal then?
>
>Here are some other signals that match right in. The right line is broken,
>a flat bottom pennant forms, volume pops back up as the pennant point
>arrives.
>
>If you decide to hold at these points and not take a profit that is okay.
>But move back to the slower fractals (daily and 30 min) and trade there over
>several days.
>
>Using the 30 and 5 min fractals is not day trading at all. What it is is
>just using a portion of the intermediate term channel to make a lesser short
>term trend work for you instead of going all the way across for the 60%
>gain
But yourpreference it to act on the shorter term signals to take
smaller but more frequent profits, right? If I had acted on the 5-min
MACD signal today I could have had nearly 10% in a day.
>
>Use the max peak values of MACD to be a guide for the factal you are using
>for anticipation. I did both for you.
>
>MOGN had a BO down as you say. Now it is going back up from the MACD
>bottom. Tomorrow AM you can glue onto the 5 min MACD and see it lift across
>the "0".
If it doesn't and breaks down again and takes the 30 min through zero
I'm out?
>Then go to the 30 min and use it as the fast fractal for the
>daily. The MACD will follow suite on the 30 and in a few hours it will come
>above "0" after a little time "near "0" like on the 21 AUG. If the 30 chart
>begins to look like the 23 AUG, then you better go back onto the 5min chart
>and make the exit when the MACD comes off its highest values diverging.
>
Thes type of historic references really help clarify things
>These two scenarios are the likeliest. the 21st one leads you up nother 3
>points. The 23rd takes you out no lower than the place you are now.
>
>regards
>
>jack
>
Thanks Jack, this really gives me a lot to think about and hopefulyy
helps take my trading sophistication to the next higher level. I
really appreciate it.
Jack Hershey
You can see this AM that MOGN has picked up 2 or 3 percent and on the
anticipatory 30 min bars, the three points 1, 2, 3 for setting up a channel
are in place and the price bars are in the lower third of the channel. the
goal is to cross the channel at 35 or above and have 15 percent profit in
the next few days. draw a parallel line to the bottom of the channel 5/8
below the channel and use it as the stop value at any time. I used the
drawdown on the 24th's open to get the 1/2 value and added 25% or 1/8 to it
to get 5/8ths.
I commented following your comments below. Three *** are at the beginning
of each.
regards
Jack
"Don Cameron" <donald....@sympatico.ca> wrote in message
news:7aloqs0mlbrrujr9k...@4ax.com...
*** Yes a line I call a ray because once you start it it goes to the right
infinitly as a reference.
>
> > shape vup your MACD (5 13 6) values. to see what
> >daily and 30 bar chart values are expected during the short term trends a
> >cross the channel that you are going to trade.
> >
>
> Done. I note that the daily MACD is not very sensitive, perhaps
> because of the extreme trough in April compressing the scale. I note
> that it produced a relatively timely signal for the late May rise, but
> that the current surge has not been sufficient to clearly break it out
> of entwining.
*** just make the height of the MACD space bigger so you have the scale
expanded.
>
> >Here you can decide if you want to slip into a faster money making pace.
> >You can pull down 25% on this stock in four days usually it looks like.
> >from your query it looks like you have perceived this and are operating
on
> >that capital appreciation level which is a good choice for you and others
of
> >your persuasion.
>
> That is the hope.
*** Right. i recommend that everyone start at the 50 cycles @ 10% for 3
years to get a gain of 64 times in the three years. (this is 1 1/3 capital
turnovers a month.) After that you step up the ROI by interatively refining
what you are doing. If I am seeing people face to face twice a week
(evenings or weekends), they get to 30% every 15 business days (three
calender weeks) by paper trading in the evening and not monitoring the open
market.
>
> >
> >Most of the above, then becomes a healthy background in which to play.
> >notice we have to get the stops straight on this stock no matter what
pace
> >of capital acquisition you choose. Do this in two steps. for
onventience
> >use the 30 min bars and sweep along through the current intermediate
trend
> >giving regard to how fast prices change by looking for the overall
envelope
> >of the MACD. it is +/- 1.00.
>
> With my data source (quote.com livecharts) I can only produce a chart
> back to AUG 16 on the 30-min scale and the envelope is +1 to -0.5,
> with the +1 being hit only briefly today. Are you able to look at a
> wider range of data?
*** No I can't. I drag the chart backwards to show portions further and
further back. I use the Qcharts version of quote.com. but I think you can
drag the charts on quote.com.
>
> >So that is where you will stop out if you set
> >your stops closer than 125 % of the price draw downs when MACD hits -1.00
in
> >the up intermediate trend.
>
> So I have to be prepared to allow it enough slack that MACD can go
> down to -1 without my stop being hit? I am not sure how I would
> determine this in advance as the MACD trough is a function of both the
> size and velocity of the decline. Could you clarify please?
*** See if what I said above works for you. You determine it in advance by
looking at the past extremes. You see that I feel the same as you about the
delcines. The fast ones are the problem and the MACD emphasizes this. I
have some airflight layovers coming up in Hong Kong and Singapore do you
live near there? I know you don't, but it would be neat to meet for a
period of time and just do some monitoring or something. I have some videos
people made to pass stuff on to their kids. We can work on getting some
good examples going soon.
>
> > Pop back up to the dailies and you will see
> >several draw down days where long and low bars occur due to trading in
poor
> >block sizes on the part of niave market order persons.
> >
>
> I am afraid you will have to spoonfeed me here. Could you identify a
> few of these days please as I do not know what I am looking for.
*** I neglected to note the points. I'll go back and pick them off tonight.
>
>
> >Since you are going to pull profits in shorter periods on the present
trend
> >we need to be sure that you don't get stopped out during one of these
strong
> >short upswings and on the other hand you do exit at the short term peak.
> >
> >So the trading fractal for you will naturally be 30 min bars instead of
> >daily bars. the anticipatory fractal for the 30 min will be the 5 min
bars.
> >So add another MACD examination to the analysis. The 5 min MACD envelop
is
> >+/- 0.5. You found that on the move that was occurring along about
7AUG
> >through 12AUG
>
> Again, my data sources do not allow me to see this. What source do
> you use to see back that far on a 5-min scale?
*** Try to do the drag thing. I am sorry I didn't say I was dragging to get
back to those places.
Back dragging is one of the miracles of modern trading.
>
> > ,inbetween MOGN was showing you the DU characteristics.
> >
> >All of this is telling you that there a two point runs and pull backs
within
> >the short term trends.
> >
> >I am going to explain the rest precicisely from the money making point of
> >view now that we have the climate of the trading established and we know
> >what the magnitude of the signals are.
> >
> >I want you to hold when you are in a dull situation as you described. If
> >you see more and more the absence of signals to keep holding, then you
take
> >profits and go to cash if nothing else is available to slip into
> >immediately.
> >
> >Here is the borderline to look for. If you are in a trend like MOGN,
then
> >you see the MACD is continuing its improvement from the '0" breakout up
on
> >Monday. it is off the ground and diverging.
>
> If this is the daily MACD you need a fine eye to see it. To me it is
> barely out of entwining and by no means conclusive. The 30-min MACD
> clearly broke out but is heading back to zero and is nearly there.
> The 5-min has been mailny negative since 1:45 p.m.
*** Expand your graphic a little.
>
> > Once it is up and "away" rom
> >"0" you are trending. it will go up and this means the trend is
> >accelerating. As the ttrend gets to 0>5 on the 5 min bars, you know that
it
> >is growing as well as you can expect. The fast line you know will peak
on
> >0.5, you figured that out. So what if it comes off the peak and entwined
> >with the slow line and remains "away" from the"0", you are making profits
> >because it is + meaning there is an upward price trend.
>
> This I understand.
> >
> >Here is where you make a decision. if the entwining stops and there is a
> >divergence down of the fast MACD line. that is the ball game. Within 15
> >imnutes or so with those lines diverging and spread, there will be a BO
> >down. Worse, whern those MACD lines hit "0" you are beginning a negative
> >short down trend.
>
> This is exactly what happened at 1:30 p.m. today. Are you saying I
> should have acted on this signal then?
*** This answer is advisory. For you, I would want you to learn to act when
it is required. and do it with pictures (positive ones with no negative
terms in the words) that are enabling to make money. My specific
recommendation is, for the momment, have the channel lines drawn. you were
in the channel. that is a powerful money making picture. the next picture
would be the "failure to breakout down picture relative to the channel if it
did dip for a portion of a day. You would hold through the "failure to
breakout down" (this is a positive mind speak statement). Now you are
rising and moving laterally in the channel: If it crosses to the left, then
see that it will bounce off the channel right side and move sharply upward
after that.
***Now as you look at your opportunities, compare. If the other possible
buys you have available are beginning a steeper channel and it is a faster
pace of capital appreciation you are then driven to that place for reasons
outside of MOGN.
> >
> >Here are some other signals that match right in. The right line is
broken,
> >a flat bottom pennant forms, volume pops back up as the pennant point
> >arrives.
> >
> >If you decide to hold at these points and not take a profit that is okay.
> >But move back to the slower fractals (daily and 30 min) and trade there
over
> >several days.
> >
> >Using the 30 and 5 min fractals is not day trading at all. What it is is
> >just using a portion of the intermediate term channel to make a lesser
short
> >term trend work for you instead of going all the way across for the 60%
> >gain
>
> But yourpreference it to act on the shorter term signals to take
> smaller but more frequent profits, right? If I had acted on the 5-min
> MACD signal today I could have had nearly 10% in a day.
*** Okay the picture is becoming clearer. You are becoming sensitive to
the real potential of the market. Please read this thoroughly so you get the
picture even more clearly. I pulled a universe for the weekend (as usual,
and for a class) I had 150 or so stocks to examine. I also have a
"performers" list. a recently owned list, and a rockets list. from these i
prepared my "possible buys" and I thought about how to have invested
capital become available for them. On Monday AM for watching were several
stocks. This is like the posts for Passat a little while back. Of the ten
specific focussed stocks I displayed (on my right computer) among them are:
ELNT, CHKP, and PCCC. I believe you would have dumped a lesser performer in
you portfolio in consideration of these stocks. Weekend, Monday, Tuesday is
a period of anticipation the opposite of predicting.
there will be no day of the week that you can't have a good list of stocks
that are going to begin their upward breakout in the very near term. MOGN
told you the same thing on the 24th, 25th and when you went into it on the
28 or 29th for the rapid appreciation.
***There are rules for this behavior. It is being mechanized and reduced to
documentation and software. And each is being upgraded. In a few years or
something the financial industry is going to move from an elaborate overkill
computerized prediction approach to anticipation with simple direct
unequivocable elegance. We are making that possible through these
dialogues.
***Just for the humour of it look at a stock that exhibits the stuff I spoke
of above. One of the owners (and I am one too) just gave me a call
suggesting it was following through properly. POSO shows you how
consecutive days are possible too. It is in sync with MOGN and just running
a little steeper. i don't recommend chasing MOGN, POSO, ELNT, PCCC, or CHKP
to anyone, but their are staocks everyday to "see" after you have
anticipated their trend inceptions.
> >
> >Use the max peak values of MACD to be a guide for the factal you are
using
> >for anticipation. I did both for you.
> >
> >MOGN had a BO down as you say. Now it is going back up from the MACD
> >bottom. Tomorrow AM you can glue onto the 5 min MACD and see it lift
across
> >the "0".
>
> If it doesn't and breaks down again and takes the 30 min through zero
> I'm out?
*** Right. Some day, though, that is going to happen....just not
today...or at least not this morning....lol You are anticipating it though
so there is no problem about getting out properly now. And that was the
goal of this thread.
>
> >Then go to the 30 min and use it as the fast fractal for the
> >daily. The MACD will follow suite on the 30 and in a few hours it will
come
> >above "0" after a little time "near "0" like on the 21 AUG. If the 30
chart
> >begins to look like the 23 AUG, then you better go back onto the 5min
chart
> >and make the exit when the MACD comes off its highest values diverging.
> >
>
> Thes type of historic references really help clarify things
*** Yes I agree. I am doing it because of the value you appreciate. A
picture is worth a 1000 words or at least 850 if you have a B average.
>
> >These two scenarios are the likeliest. the 21st one leads you up nother
3
> >points. The 23rd takes you out no lower than the place you are now.
> >
> >regards
> >
> >jack
> >
>
> Thanks Jack, this really gives me a lot to think about and hopefulyy
> helps take my trading sophistication to the next higher level. I
> really appreciate it.
*** You are vey welcome. I know that this thread will help a lot of people.
And even moreso because of how you make it available to others. I like the
team we have working on this stuff. It is going to go to alot of good
places; I believe that deeply
Jack Hershey
As you examined MOGN last night you can see that the trend is established
as we anticipated. Reaching 35 now was our view because of how the channel
laid out. The top of the channel today is around 43 and rising as the days
pass.
Now we can use the daily as the trading fractal and the 30 for our
anticipatory look see. Notice on the daily how the MACD (5 13 6) is doing
the divergence on the rising trend. Look over the entire chart to gain an
understanding that the trend is being established quite like the clockwork
we originally desired. But we did have to go through the beginning of the
trend with an attitude that is one of caution and sensitivity. this
experience does help to establish out confidence and will not make use
casual on the other hand. Once you begin to make money at this pace with
each stream in your portfolio you will find that you set a standard of
excellence that will continue for a long time.
Its like the 40 dollar hair cut. You get used to looking your best. The
volume before your buy was in Dry Up now you are transitioning through the
FRV (First Rising Volume) into the higher levels of daily volume that you
find elsewhere on the chart. high volume is what drives you into the middle
of the trend. Think about how the long term owners are looking at their
investment. As the stock goes up more and more their are less loosers in
the group. When they each feel satisfied with their progress on profits
they are going to check out. The buy and hold persons are just going to
keep holding, of course because their objective is to prove their purity in
following their stupid rule.
Move to the daily graph to set your final stop offset value. The one we
chose still applies it looks like. A 5/8 offset looks good for MOGN. It
will keep you in the trend. Draw the bottom of the trend in and clone a
parallel line along the top on the daily just so you have the overview..
The daily trend started in mid april and point 3 was in May. However,
offset your 5/8 stop on the 30 minute bars. We are just taking the trip
across the daily channel only if it goes all the way across on the 30 minute
chart. This is because you are now trading at a higher level of competence
instead of the first level. Prior posts have our stategy in place for the
run of the trend.
Labor Day weekend will give this trend a slow motion effect due to the rich
people being on their last summer flings before they settle down for the
collegiate fall social schedule or whatever. Year end bonuses are not an
the horizon yet. Plan on equalling you performance for the first half of
the year in the period from Labor Day to the New Years millenium
celebration.
"Jack Hershey" <jher...@primenet.com> wrote in message
news:8ojakq$onc$1...@nnrp03.primenet.com...
Don Cameron
up until the end of the move for further education. However, it will
be academic from now on as far as I am concened. This afternoon the
30-min broke down much like Aug 23, which you had pointed to before,
and the 5-min was negative so I bailed out at $34. Seemed like a
good idea at the time, but the action late in the day may well prove
me wrong. Clearly I failed to pay sufficient attention to your
advice about the 30-min trend-line and I now realize that your caveat
about the AUg 23 behaviour only applied until the trend was in place.
Hopefully I will do better next time as result of this lesson.
If we step back a bit from using MACD and 30-min trends as a signal,
based on the decline in volume today, would you be looking to exit
early tomorrow as you have previously suggested that a decline in
volume after a surge is a sign that the end of the move is near. Or
do you see today as just a lull and expect more action after the long
weekend?
How much significance would you give to the prior peak in July at
about current levels as possible resistance and an additional warning
to be watching for a top?
I have a couple of other points in the text below.
On Thu, 31 Aug 2000 07:33:27 -0700, "Jack Hershey"
<jher...@primenet.com> wrote:
>Hi Don,
>
>As you examined MOGN last night you can see that the trend is established
>as we anticipated. Reaching 35 now was our view because of how the channel
>laid out. The top of the channel today is around 43 and rising as the days
>pass.
>
>Now we can use the daily as the trading fractal and the 30 for our
>anticipatory look see. Notice on the daily how the MACD (5 13 6) is doing
>the divergence on the rising trend.
Yes, this is quite clear now.
> Look over the entire chart to gain an
>understanding that the trend is being established quite like the clockwork
>we originally desired. But we did have to go through the beginning of the
>trend with an attitude that is one of caution and sensitivity. this
>experience does help to establish out confidence and will not make use
>casual on the other hand. Once you begin to make money at this pace with
>each stream in your portfolio you will find that you set a standard of
>excellence that will continue for a long time.
>
>Its like the 40 dollar hair cut. You get used to looking your best. The
>volume before your buy was in Dry Up now you are transitioning through the
>FRV (First Rising Volume) into the higher levels of daily volume that you
>find elsewhere on the chart. high volume is what drives you into the middle
>of the trend.
This is interesting, as I had thought of FRV as what we saw on Monday
when it was starting it's move. I was looking for something
comparable to what we saw in mid-July in terms of volume and size of
the move. Your remark suggests you are looking for much more,
particularly in terms ov volume - perhaps similar to what we saw in
the first 3 months of the year?
>Think about how the long term owners are looking at their
>investment. As the stock goes up more and more their are less loosers in
>the group. When they each feel satisfied with their progress on profits
>they are going to check out. The buy and hold persons are just going to
>keep holding, of course because their objective is to prove their purity in
>following their stupid rule.
>
>Move to the daily graph to set your final stop offset value. The one we
>chose still applies it looks like. A 5/8 offset looks good for MOGN. It
>will keep you in the trend. Draw the bottom of the trend in and clone a
>parallel line along the top on the daily just so you have the overview..
>The daily trend started in mid april and point 3 was in May. However,
>offset your 5/8 stop on the 30 minute bars.
So, you are saying draw a trend-line based on the 30 min bars for the
current move and set a stop 5/8 below this? This would place the
stop currently at about 33 3/8 currently. I can see the logic in
this and it is becoming clear that I have been too eager to snatch at
profits. You may like to look at the post referenced by the URL below
to see how I exited the 4 trades I did last week. Three would now be
higher than my exit price, and one about the same.
Jack Hershey
I started this after the close yesterday and I had a class at 4PM so I
didn't get it finished at that time.
We are now at a point with MOGN that the daily and its anticipatory fractal
the 30min chart can show us a good picture of trading the natural cycle. So
I want to add another indicator to help us "see" better. Add a stochastic
(5 3 3). Once you have in on ith the volume and the MACD (5 13 6) you can
see on the daily several of the "natural" trends within the current
Itermediate Term channel shown on the daily. A couple of relaxing
paragraphs follow and then we can go to work.
The stochastic on the daily shows you the harmonic within the channel and we
make our money on the harmonic which is best analyzed as an anticipatory
task on the 30 minute bar chart. the stochastic gives us buy and sell
signals that are nicely anticipatory.
Glance through the five stocks in this thread mentioned in this thread which
surround the performance of MOGN. Their last four days have been
satisfactory for compounding and they, most of all, "play by the rules" for
us. Most stocks do but these came out of the mileu as a respult of our
culling to be ones that are timely and good performers for making money. A
KISS trading approach would be to sell each and take a long Labor Day. Hey
why not. Look at it this way simply. if you can do an expert job culling,
call your broker and buy. then when you have serious golf or sailing to do,
go to cash and slip back into the market on Wednesday. I guess I am
pbligated to put up the Wednesday list to make my point. I upgraded my
Singapore return flight after New Years yesterday.
Allow yourself to rotate through the dailies on all five stocks twice. You
will see that MOGN may not make it across the Intermediate Term channel but
it has made over 15% so far in this thread. It is doing as well as the last
five "natural" runs since JUN though. The POSO and PCCC have done better
and ELNT and CHKP have done poorer. Any specific ones chosen from this
group if funds are limited by parallel successses in other stocks, are
dictated by the slope of the capital appreciation past performances which
becomes an automatic simple arithmetic check normally. these are choices
that are moderately important but they don't compare at all the the exercise
of coming up with the short list of possible buys every day. I rank my
short list by this propensity usually or I rank them from most expensive to
least so I can easily see the best rising stocks in the first several
minutes before the open by judging the spreads of bid ask and the off set
from the close for the gap ups that will be coming at the opens.
Lets go to work now. look and see if you have another possible buy stock
making more than 5 to 6 % a day. If you do consider swapping out that stock
for MOGN. MOGN is now heading into the territory where it will fail to
provide continuing strong signals of a good extension of the trend. Its
that "What wasn't that" time for the foghorn administrator at the
lighthouse.
You can become as sensitive as the fog horn administrator to
your indicators once you have the "what wasn't that" attitude.
Here is a list in order of importance that I posted before that deals with
"what wasn't that":
1. Divergence ends on multiline indicators (MACD and stochastics).
The trading fractal MACD will do this as the fast line comes to the peak.
then the daily stochastic fast line will do it when it crosses the 80% line
on the way up to overbought level.
2. There is a decline in value of the dynamic equilibrium of your
indicators.
The slopes fall over the horizontal for MACD and Stochastics and the volume
is flat.
3. The operating point of the market changes with respect to fractal and/or
pace (if both, the diagonal motion is more significant). Think about it are
you even going to make up a crude matrix to find out how to measure pace or
even just list the fractals in order and figure out what goes from left to
right or up and down.
Move from the daily/ 30 min pair to the 30 /5 min pair.
4. Volume changes: ONLY downward matters.. If it is changing upward go
back to sleep and listen to the foghorn--- the herd is still pushing you if
it is going up. DOWNWARD IS THE INDICATION OF A POOPED HERD.
The daily gave you this indication on a pro rata basis during the day. You
are sharp enough to recognize this so begin to do it. And the EOD shows
this as well.
5. A volatility compression begins.
Bars elssen in height.
6. Indicators centered on zero begin to make an asymptotic approach to zero.
7. You are now more than 1/2 way to the intersection of all asymmetric
formations (See 5 for the precursor of shortening bars within the
formation).
8. You are no more than two cells away from the five cells labelled Breakout
or Reversal. You have the matrix I believe on the website.
9. The frequency of oscillation of the zero centered single line indicators
is maxed and the amplitude is following 6 (i.e., lessening steadily).
10. Congestion (signal to noise ratio is less than one for price) and there
is a channel that is horizontal on a fast fractal.
11. The price channel of 10. goes into convergence,
12. The price convergence of 11. becomes centered.
Jack Hershey
See below. Look for the *** where my comments follow.
"Don Cameron" <donald....@sympatico.ca> wrote in message
news:0q5uqs8r9c6u3t8jp...@4ax.com...
> Hi Jack, the continuing commentary is very useful and please keep it
> up until the end of the move for further education. However, it will
> be academic from now on as far as I am concened. This afternoon the
> 30-min broke down much like Aug 23, which you had pointed to before,
> and the 5-min was negative so I bailed out at $34. Seemed like a
> good idea at the time,
*** thats how you should feel with your V-A -K process based on your "mind
speak". You loked at the chart (V), you considered the intellectual basis
(A) {mind speak) and your feelings were positive and in concert (K).
but the action late in the day may well prove
> me wrong. Clearly I failed to pay sufficient attention to your
> advice about the 30-min trend-line and I now realize that your caveat
> about the AUg 23 behaviour only applied until the trend was in place.
***This is a debriefing exercise that is very very good to do. you are
processing, itieratively the facts of the matter and you are assimilating
them into your NRP collection of rules. The additions to your reservoir of
resouces clearly are going to "say" to you "pay attention to.....etc. This
is powerfule stuff and you are in an exceptional place in your sensitivity
to the market.
> Hopefully I will do better next time as result of this lesson.
*** This is a big conclusion to draw. What a difference it is between
being given a fish compared to learning to fish. the posts here often are
asking for fish when this is a place for fishing lessons for those who both
fish and and like to go fishing. My rewards here are to learn about people
and how to better communicate. You can see how valuable you make this to
me.
>
> If we step back a bit from using MACD and 30-min trends as a signal,
> based on the decline in volume today, would you be looking to exit
> early tomorrow as you have previously suggested that a decline in
> volume after a surge is a sign that the end of the move is near. Or
> do you see today as just a lull and expect more action after the long
> weekend?
>
*** You have articulated the two major considerations. At 10amEST, the
volume is 10% of the 65 day average 1/15 of the way into the day....so I
believe there is still good volume for day 5 of the trend. the weekend is a
high impact thing. And so is the continuing effect of the concerted up ward
movement of all markets this am. If you glance at the bid asks before open
in your lists, you also knew there were going to be some gaps up. Our short
list of five bears this out too; these fish are definitely moving ahead of
the current. When people leave early today to beat the rush, things will
taper back and by Wednesday we will be in the thick of it again.
*** The MOGN trend end is more and more possible, use the list in my prior
post to see the trend grow flakey. About the worst we can do now is have a
better than usual run in just a few days. Acheiving 10% in four days is a
good target for you for each of the stocks you are rotating through in your
portfolio. If you do a 10 % complete portfolio rotation every 6 to 8 days
it adds up quickly. Dividing that performance by two because it moves
slower is just as good actually. A knee in the capital appreciation curve
occurrs when you get to the place where you are giving away more and more of
your results. There is a guy who posts here about if a person is making 50
% a year. When he gets to posting about whether you are giving away more
than 50 % a year I might comment to him.
> How much significance would you give to the prior peak in July at
> about current levels as possible resistance and an additional warning
> to be watching for a top?
*** A very great deal. That is the plae where you can have a lot of your
reference rays emminate from. these are on the MACD, and volume subcharts.
*** There is the point that MOGN doubles often. You can see two on the
daily or weekly. These are news related I would believe. I have a stock
that has had three strong buys in the news on consecutive days this week.
This tends to help you make a lot of money if you sense to buy before the
news of this sort. This is part of the culling you do to get powerful
universes. I have a couple of universe subsets that are focussed on such
types of rewards; I scan them using about the four devices we are
emphasizing here. Students who are sharp that do this with me generally go
beserk when they see one that is going to shoot (One list is a "rocket"
list).
>
> >Think about how the long term owners are looking at their
> >investment. As the stock goes up more and more their are less loosers in
> >the group. When they each feel satisfied with their progress on profits
> >they are going to check out. The buy and hold persons are just going to
> >keep holding, of course because their objective is to prove their purity
in
> >following their stupid rule.
> >
> >Move to the daily graph to set your final stop offset value. The one we
> >chose still applies it looks like. A 5/8 offset looks good for MOGN. It
> >will keep you in the trend. Draw the bottom of the trend in and clone a
> >parallel line along the top on the daily just so you have the overview..
> >The daily trend started in mid april and point 3 was in May. However,
> >offset your 5/8 stop on the 30 minute bars.
>
> So, you are saying draw a trend-line based on the 30 min bars for the
> current move and set a stop 5/8 below this? This would place the
> stop currently at about 33 3/8 currently. I can see the logic in
> this and it is becoming clear that I have been too eager to snatch at
> profits. You may like to look at the post referenced by the URL below
> to see how I exited the 4 trades I did last week. Three would now be
> higher than my exit price, and one about the same.
**** I am smiling. it will become more and more clear to readers that
anyone can take their starting point and simply go through doubling after
doubling of their performance. About 8 times in my opinion. Your comment
above illustrates another potential doubling by the time compression it
represents indirectly. Please do as you have realized you should by the
above statement. I will in the near future give you the next two doublings
that build on this one that you have internalized...
>
>
http://www.coolboard.com/msgshow.cfm/msgboard=586866385932493&msg=1895994619
6736&page=1&idDispSub=659539442790969
Don Cameron
30-min trendline minus 5/8 stop would have been triggered today at
about $34. So, one would presumably be out of MOGN on this basis, but
I am not sure if there are other considerations at play.
Assuming one is out this raises the question of whether you would now
prefer to look for other fish to fry or would you consider re-entry on
MOGN in the current short-term trend if, say, the 30-min downtrend
line were now to be violated on a fresh volume surge next week? My
guess is that it depends on how attractive you see the new candidates.
I guess my question is: do you have any fundamental objection to
re-entries?
On Fri, 1 Sep 2000 06:23:49 -0700, "Jack Hershey"
<jher...@primenet.com> wrote:
>Hi Don,
>
>I started this after the close yesterday and I had a class at 4PM so I
>didn't get it finished at that time.
>
>We are now at a point with MOGN that the daily and its anticipatory fractal
>the 30min chart can show us a good picture of trading the natural cycle. So
>I want to add another indicator to help us "see" better. Add a stochastic
>(5 3 3). Once you have in on ith the volume and the MACD (5 13 6) you can
>see on the daily several of the "natural" trends within the current
>Itermediate Term channel shown on the daily. A couple of relaxing
>paragraphs follow and then we can go to work.
>
>The stochastic on the daily shows you the harmonic within the channel and we
>make our money on the harmonic which is best analyzed as an anticipatory
>task on the 30 minute bar chart. the stochastic gives us buy and sell
>signals that are nicely anticipatory.
>
I have done this, but I am not sure what the stochastic adds. It's
ups and downs correlate quite closely with MACD 5,13,6, but with a
more sensitivity. With refinement comes complication. I now have a
number of things to take into consideration: volume size and trend,
price change trendlines and MACD on a daily and 30-min basis (with 5
min for fine tuning exits) and now stochastics.
>Glance through the five stocks in this thread mentioned in this thread which
>surround the performance of MOGN. Their last four days have been
>satisfactory for compounding and they, most of all, "play by the rules" for
>us. Most stocks do but these came out of the mileu as a respult of our
>culling to be ones that are timely and good performers for making money. A
>KISS trading approach would be to sell each and take a long Labor Day. Hey
>why not. Look at it this way simply. if you can do an expert job culling,
>call your broker and buy. then when you have serious golf or sailing to do,
>go to cash and slip back into the market on Wednesday. I guess I am
>pbligated to put up the Wednesday list to make my point. I upgraded my
>Singapore return flight after New Years yesterday.
>
>Allow yourself to rotate through the dailies on all five stocks twice. You
>will see that MOGN may not make it across the Intermediate Term channel but
>it has made over 15% so far in this thread. It is doing as well as the last
>five "natural" runs since JUN though. The POSO and PCCC have done better
>and ELNT and CHKP have done poorer.
I am surprised that POSO was on your list. It looks like a bit of
bottom fishing and counter-trend trading based on the intermediate
term trend.
> Any specific ones chosen from this
>group if funds are limited by parallel successses in other stocks, are
>dictated by the slope of the capital appreciation past performances which
>becomes an automatic simple arithmetic check normally. these are choices
>that are moderately important but they don't compare at all the the exercise
>of coming up with the short list of possible buys every day. I rank my
>short list by this propensity usually or I rank them from most expensive to
>least so I can easily see the best rising stocks in the first several
>minutes before the open by judging the spreads of bid ask and the off set
>from the close for the gap ups that will be coming at the opens.
>
>Lets go to work now. look and see if you have another possible buy stock
>making more than 5 to 6 % a day. If you do consider swapping out that stock
>for MOGN. MOGN is now heading into the territory where it will fail to
>provide continuing strong signals of a good extension of the trend. Its
>that "What wasn't that" time for the foghorn administrator at the
>lighthouse.
>
> You can become as sensitive as the fog horn administrator to
>your indicators once you have the "what wasn't that" attitude.
>
> Here is a list in order of importance that I posted before that deals with
>"what wasn't that":
>
>1. Divergence ends on multiline indicators (MACD and stochastics).
>
>The trading fractal MACD will do this as the fast line comes to the peak.
>then the daily stochastic fast line will do it when it crosses the 80% line
>on the way up to overbought level.
You stated previously that the daily is now the trading fractal. MACD
has not yet peaked and is not overbought, but stochastics is in
overbought range. I am not sure how to interpret your advice on
divergence here.
>
>2. There is a decline in value of the dynamic equilibrium of your
>indicators.
>
>The slopes fall over the horizontal for MACD and Stochastics and the volume
>is flat.
>
>
Slopes are all positive , but volume is down 2 days in a row - a
holiday weekend effect?
>3. The operating point of the market changes with respect to fractal and/or
>pace (if both, the diagonal motion is more significant). Think about it are
>you even going to make up a crude matrix to find out how to measure pace or
>even just list the fractals in order and figure out what goes from left to
>right or up and down.
>
>Move from the daily/ 30 min pair to the 30 /5 min pair.
I have thought and guess the matrix is based on volume change
(vertical axis) and pace i.e. fractal pairs (horizontal axis).
However, I am far from sure. Also I do not yet understand how one
decides to move from one fractal pair to another.
I perhaps see this for the start of a move - 30-min and 5-min pair
until a trend is clearly established on a 30-min chart, when one moves
to the daily and 30-min level. However, I need further guidance on
how one decides to go back to the faster pace in anticipating an exit.
>
>4. Volume changes: ONLY downward matters.. If it is changing upward go
>back to sleep and listen to the foghorn--- the herd is still pushing you if
>it is going up. DOWNWARD IS THE INDICATION OF A POOPED HERD.
>
Noted previously, down 2 days in a row.
>The daily gave you this indication on a pro rata basis during the day. You
>are sharp enough to recognize this so begin to do it. And the EOD shows
>this as well.
>
>5. A volatility compression begins.
>
>Bars elssen in height.
Range decreased each of the last 3 days.
>6. Indicators centered on zero begin to make an asymptotic approach to zero.
>
>
This all depends on which timescale one is focussed on, depending on
which they may be diverging from or converging on zero. Guess it
comes back to the significant fractal thing.
>7. You are now more than 1/2 way to the intersection of all asymmetric
>formations (See 5 for the precursor of shortening bars within the
>formation).
Intersection of what - upper and lower trendlines in triangles and
pennants?
>8. You are no more than two cells away from the five cells labelled Breakout
>or Reversal. You have the matrix I believe on the website.
I don't think I do. This may help make things a lot clearer. I
would be happy to post it if you could email it to me
.
>9. The frequency of oscillation of the zero centered single line indicators
>is maxed and the amplitude is following 6 (i.e., lessening steadily).
Which single line indicators? MACD and Stochastics are two lines -
Wilder' RSI?
>10. Congestion (signal to noise ratio is less than one for price) and there
>is a channel that is horizontal on a fast fractal.
>11. The price channel of 10. goes into convergence,
>12. The price convergence of 11. becomes centered.
Congestion is trading in a range and convergence is a narrowing of the
range - right?
Jack Hershey
My list of posts on MIT dropped to 112 instead of about 300 so it is a
little disconnected at this point. I think I pressed the wrong button.
The post I made covering the "what wasn't that" 12 items covers most aspects
of an exit. I notes some comments below.
"Don Cameron" <donald....@sympatico.ca> wrote in message
news:9462rsooe152tmj2k...@4ax.com...
> Before getting into commenting on the post below I note that the
> 30-min trendline minus 5/8 stop would have been triggered today at
> about $34. So, one would presumably be out of MOGN on this basis, but
> I am not sure if there are other considerations at play.
*** Yes you can see that the stop was rising, being offset from the rising
channel. The EOD volume was a terrific clue as usual. It peaked and the
day following you would have kept track of it for the first hour or so and
seen that the "push" of volume was gone. This is a good addition to
momentum type trading approaches, i. e., to do prorata evaluations on the
time period used for trading to interpolate the situation. Interpolation is
always better than extrapolation (prediciting). Taking a closer look at the
workings of things always beats out the prediction stuff. Anyway you would
have left MOGN at 34 1/2 or maybe a little better as you saw the volume
flagging and the 10, 11, and 12 stuff happening (see way below). The KISS
aspect of reading this thread would have taken others out at 35 just because
it came up in the framing of the process. Your exit at 34 early is, of
course, the sophisticated thing because you got two additional trading days
in. This represents about a 7% additional profit using the rate of capital
appreciation you had for MOGN as you slipped into another stock beginning
its run..
>
> Assuming one is out this raises the question of whether you would now
> prefer to look for other fish to fry or would you consider re-entry on
> MOGN in the current short-term trend if, say, the 30-min downtrend
> line were now to be violated on a fresh volume surge next week? My
> guess is that it depends on how attractive you see the new candidates.
> I guess my question is: do you have any fundamental objection to
> re-entries?
**** Correct. I do this. I put MOGN on a list I keep called recently
owned. Daily, I evaluate two sets of lists. The culled set of lists are
the 1, 0 and 7's from my scoring. This is 30 stocks from 150 from 15,000.
If you wanted to replace Vance and Eloise in one fell swoop, i.e., speeding
up eloise and slowing down Vance, you would do stocktable.com >90EPS, 90>RS
and all for the rest and 10 minimum price setting and sort by % change in
volume. See the power here of combining CANSLIM and VOLUME as the culling
mechanism. This is VERY VERY POWERFUL STUFF!!!! Think of the bottom of the
sawtooth of a stock cycle where 1 to 0 approaches the trough and after the
trough 7 occurs (The scoring stuff). Here is where the 10 stocks for each
of these cycle points occur on the stocktable.com. The top ten stocks that
have price increases (some on the list have just passed the peak and the
high volume is their rapid price descent beginning according to the P, V
relation.). List these top ten volume increasers with price increases as
well on a list called "sevens" in clearstation.com. Go to the end of the
stocktable.com list and make a Dry up 1 list using the ten bottom stocks
that have volumes over 20,000 daily share trades. Less than 20,000 denies
you the volatility you need to trade ( I am trading multiple 20,000 dollar
blocks so I don't want to affect the market adversely. See the 100,000
share trade I did on GZTC that took 31 trades to get out). Continue up the
list for the next ten naming the portfolio Dry Up 2. Now you have 30 stocks
in three portfoilios in clearstation. This is all free of charge too. Look
at them in clearstation in this order by first putting each list in order
using the % change on the left as the criteria. The order is sevens, dryup
2 and then dry up 1. What you are doing is looking at the troughs of the 30
best high quality stocks from a list of 15,000. Do the examination by
bulking the charts in clearstation.
THIS STUFF IS VERY IMPORTANT.
There are the nine things to look for using indicators on the clearstation
bulk display. Ali Babba suggested to Pres that an approach comes first and
the indicators then become powerful tools. The basis of everything for me
is how the market works. That was defined by Dow and his successors who
successfully established indexes and the P, V relation long before
computers, Xeroxes, and just after George Boole made his magnificaent
contribution (1840's) when he discerned that for every numeric base there is
a different algebra. And, second, for me, how the compound interest formula
instructs you on how to make money. That is why Vance needs to slow down
and Eloise needs to speed up and stay in the market at all times. Its not
just my opinion; its the mathematical relevance of the matter. Pres will
pick an operating point by using his IT training and experience. He will
then look for markets to trade. Equities are a good choice at this time of
unprecedanted and permanent period of expansion. Look at NASDAQ opening up
another exchange in Brazil. Our global expansion is ensuing without any
regulation but just as a self policing entity that makes money. I believe
money is created continually through the creation of value. Our negative
balance of payments seeded the global economy in ways that it will take the
analyists years to discover. If I wrote books in the financial industry
field as I do in other cutting edge fields, I am sure my two cents would get
a few others off their analytic bottoms once in a while.
By culling and setting up three high quality lists that surround the trough
of the trading cycle, we can find out what the optimal cycle is. but i will
come to that another time; vance is too shaort and Eloise is too long from
what the market tells us.. We just finished asking the market for the best
opportunities based on the P,V relation. Eloise uses the first half of the
Boolean P,V statement; it is: If the volume is increasing, the price will
continue its trend. The trough forms as volume declines to dry up, a simple
condition where the market participants choose to disagree on everything
including price. The sellers want out because the stock is "no good"; the
buyers want in because the stock is the "best" they have found. All that is
left to do is agree on the price. When they can't agree the "four oclock
drift" sets in for price as the volume goes into Dry Up. We are looking at
this decrease at the bottom of our quality culled list. at first the
decrease is rapid (Dry Up 1) and then it slows (Dry Up 2). Once the traders
chanbge their minds about things over time, the volume creeps upward for
part of a day and reaches DryUp amounts within an hour or so. There is no
price rise yet. BUT IT IS TIME TO BUY IF YOU ARE MAXIMIZING PROFITS as the
mediocre traders like to do. They have yet to learn to optimize capital
appreciation. You can see we are quite a ways away from the mutual fund
manager types at this point. The MOGN trade knocked down a years mutual
fund profit operations in about four days. Now we have 246 days of trading
left in a year to do better than mutual funds.
So to pick out possible buys you bulk through the clearstation three lists
in this order. Sevens, Dry Up 2 and Dry Up 1. Some you will see you are
chasing as they leap out on the higher volume. the P,V relatin in action.
|Some you will see are not bottomed out yet. I make three possible buy sub
lists: those that are perfect unflawed ready to go tomorrow morning: PHTN,
PLMD, YCC, PLCE SAPE from my three lists (7's, DU1 and DU2) I set up a
couple of days ago and didn't change out for last night. They are going
today as you can see. I own two of them now. My second sub list is: AAON
PLXS FORR TXCC and GIL for a trough and turn tomorrow; my third list is XLTC
ADCT XLNX and SSTI for the days after tomorrow. So I am anticipating and
not chasing stocks. I am monitoring all these on one list on Qcharts
(xtreme right monitor) and I have formations and indicators running too.
You can just monitor with EOD data just as well. It takes a few days to do
a cycle and looking at stocks only in the evening works just as well.
My possible buys check sheet contains the following columns and the top line
title reads : " possible buys check list ( check for presence and note all
exceptions). There are nine columns: stock, Volume in DU, MACD, Right line
BO up, 50MA line, Bottom of cycle (two columns), Stochastics (two columns).
You can see it is set up to read the clearstation display in a moment by
checking the presence of stuff. Volume, price stuff, MACD stuff and
stochastics stuff. I have one volume column where I note if it is in DU
still or is moving into FRV (first rising volume which is 3 to 4 times dry
up and triggers the beginning of the price move). I have all this volume
stuff automated in C language software I give away and on ver3.0 of TC2000
(Worden no longer services this version because they are primarily
interested in selling data instead of providing software. After version 3
worden lost tha ability to be able to formulate anticipatory indicators as a
sacrifice they made to handle data in a macro manner instead of focussing on
limited profitable universes. Many many people dropped worden about this
time or with the advent of 2000 when the supports for software were
dropped), and on DTN satellite.
The MACD column is not too useful on clearstation since they are stuck with
using the Appel original settings of 12 26 and 9. I use 5 13 and 6. This
is similar to how Pring switched from Wilder's settings on RSI to a choice
of 5. I use 5 as well, setting the precident before Pring I am told. Two
assessments are made on MACD if it is "away" I see how far it has proceeded
through foure serial signals: trough, rising, xover, and diverging. It is
flawed if it fails any. Second, if it is a"0" on MACD for four plus bars
(days) it must BO up and diverge. All this is recorded with four check marks
or two chack marks very very quickly. If I can't check I note NY for not
yet. I am getting familiar with the stock.
For price I move to the next coluumns. They have little notes in the
columns for those I mentor. The right line BO up column notes (On 30 bar do
1,2,3 trend), I check the column if the bars have broken up through an
imaginery right line, thus indicating the former nontrend or "short" trend
has ended. This is part of optimizing appreciating capital. Never go into a
trend unless there is a trend. This is most important; it will save you
time, which is the most important factor in making money. This is one of
the key mutual fund screw ups. They have not started to think about market
timing as yet but are tied to the fundamentals using criteria of the "old"
economy. They literally are the "herd" that follows TA people driving the
TA practitioner into profits. Especially TA people who don't use trailing
indicators. The BO on the right line is key to getting into the trend after
it starts. In late and out early will double your annual ROI faster than
any other strategy. Do a few compounding trials to prove this to yourself.
The 50MA line is a slow line drawn in the sand so it is useless for timing.
We use it as an evaluating device to determine the strength of the stock in
trending. Surprise. My check notes are: bounce up or failure to breakout
down). Every stock that makes these lists does one or the other. After
either has occurred we are ready to possibly buy it. Think about this...
It has finished going down if it passes these tests. And you are now
getting locked into the "natural pace" of the stock making money the way it
dictates its cycles. Look back you will see at least five of these cycles
for the last six months. Eloise trades too slowly. Vance misses most of the
"natural" trend run each time; he is on the too fast (not "natural"
fractal). I have a performer list I keep. It has 26 stocks on it. They
must move 9 times (cycle) in six months and have most daily bars that are
10% in height. This list makes a lot of money over and over in very short
periods of time. As I analyze the possible buys, I note performers. At
some poiint this will become very plain and sensible stuff for you to
consider. What is true about the market is this: it is one heck of a place
to make a lot of money and it is very very easy and logical to do. There is
no mystery what so ever. The other market I like, commodities futures
indexes is more fun because it runs 30 to 50 times faster in capital
appreciation using the same rules going both ways because it is all related
to equities only. This is what Eloise is working on sort of. But I think
that she is going to try to do all the commodities and not be able to
generalize it for several cogent reasons. For the time being just think
about this proposition. What commodities represent stocks??? Well if you
figure that out, then thats where you go with the same rules. I did. It is
incredible. And the software is a dream an totally unrelated to anything
out there now.
The next two columns deal with " Bottom of Cycle" you need to know how the
turn is made to slip into the trade nicely. My check notes for the left
column are: saucer form or live cat bounce. I put a check if either has
occured in the past (aha) and note which with initials like "S" or "LCB".
The right column is noted: double bottom or inverted head and shoulders.
Check and initial. One column of the two is empty and available for notes of
a "self speak" nature, the neuro linguistic programming (NLP) stuff. That
ends the price notes.
Stochastics is two columns too. Left column says breakout up from below 20%
and gets two checks for the sequence to be completed. The 5 3 3 stochastic
that clearstation uses is good and their description is great. Vance should
scrap his stochastics description completely because it is just a haphazard
math description that doesn't say why or what stochastics is. Eloise should
scrap her market signal thing on the same basis and substitute a pitch on
why there are always stocks to buy in the rising sectors of the market. The
right column is the payoff column of all columns. The note is: "rocket
formation (entwined on 80% line) must be second time". Imagine how this
will improve both Vance and Eloise's packages. This is the replacement for
the O'Neill cup and handle also. Takes about five seconds to do. I put a
check if its a rocket. Pres should glance at this one as he begins to think
about an approach. I 'll do the theory later. He has a two year old
daughter. My daughter commuted from Philly to Montreal on the weekends in
high school to ski for the Greyrocks ski club. As a sixth former, she was
fourth in the women's combined so she got the investment back in clothes,
equipment and her support technicians and she declined several olympic
training opportunities to follow her love of soccer.
Rockets are found on the lists as time goes by. Entwining on an overbought
indicator is the definition of capital appreciation bliss. Stochastics are
mathematically set up to entwine when maximum extended capital appreciation
occurs.(it wasn't done intentionally as you can see from the writings). As
i went through the process of "fixing" indicators, i had to convert tehm
from trailing to leading and also change their signal points. this is
difficult to do and it was required especially when the old molecular based
economy shifted to the "new" bit based economy. Some people are still using
fundamental analysis based on the "old" ecomomy as well. Warren Buffet is
steadfast in his "old" economy views and you can see his difficulties as a
consequence. What we are discussing here exceeds Buffet, Gates and Ellison
as depicted by dkomo in his seminal post "three fat cats". If a stock
"fails to breakout down" from an overbought designed indicator, (Vance read
this carefully you are looking at the wrong end of the stochastic to make
the big money) you have the best leading indicator in the "what wasn't
that|" category you are ever going to see. For those who follow my posts I
hope you are smiling. It is my keenest desire to, for years and years, to
unload really great stuff here in the context of the dry humour I love so
much. I have a rocket list I keep too. I just took SUNW, ANF, SSTI and
XLNX off it. CHP is my replacemnet for SUNW. Many people, the PhD types
(who are making special volunteer contributions) don't like the more rapid
turn over of my rotations for them so I beset them with rockets that have
Eloise type durations and are overlapped in any market.. You have just
learned how to discover rockets before they are fired. Imagine that you do
this stuff and go into a stock that passes this severe gautlet to get into.
And it turns into a rocket......Well thats nice. MOGN was a rocket at the
beginning of the year. It just when to the 500% increased altitude in two
months. By using successive stops that are set for the trend, you can ride
rockets. In a few months everyone who wants to will be I'm sure.
After I do the three lists and set up some possible buys, I just go through
my "recently owned, performer, and rocket" lists to round out the list.
That is the second set of three lists that I examine. I added CDWC CHP RATL
to rockets from my recently owned. and I added CAKE FLEX and ITWO from my
performers to the rocket list today. Things are looking up and life is
great from where I am sitting. Today is a money flight day; the old guys
call it a mixed market. My owned stocks today are really being driven by
the herd.
You can see why I was able to add some stocks to the MOGN thread now. They
did their cycles like MOGN. In this post there are a few more that will be
helpful in their current timeliness for those who just want to KISS trade
and make several percent a day.
Throw MOGN back into the lake. Think of this post as a little dry fly
fishing. You'll catch a few more now that you know where to canoe to in the
twilight. They're rising every evening and the fishings always good.
If you don't like to spend time watching the market, just do the stuff in
the evening on a fast machine. Bulking on clearstation with short hot lists
will give you a terrific focus of stocks to rotate your money through as the
stocks tell you to. Get out using the list of 12 below by looking at the
stocks at the end of the day. Thats what I did the first 5 years after
college. Of course I had to pencil chart the stocks on a graph master I
made because it was before computers and stuff. I blueprinted the master
and saved the last page of the WSJ for back plotting..Its like back testing
is today...lol..
Even my cheapest stock is up over a buck today so I guess this typing
occupied my time nicely...lol
regards
Jack