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EXAMPLE
^NDX again, this time with RSI(14) and levels 30/70.
Mean Oversold Days=2.60 (in 390 total)
Mean Overbought Days=2.55 (in 390 total)
For many stocks of this group the number is 0/390 !!
(including the Index itself)
I think this needs no comments.
--- In amibroker@xxxx, "DIMITRIS TSOKAKIS" <TSOKAKIS@xxxx> wrote:
> EXAMPLE:
> In Nasdaq 100, the mean overbought time above level 70 for
> stochd() is calculated 25 days in totally 390, i.e. ~6.5%.
> The mean oversold time below 30 is 31 days and if we want
> the same percentage we must decrease the level 30.
> In fact, if we place 26 instead of 30, we get ~6.6%.
> If the basic thought is correct, then we will have more reliable
> results if we consider 26/70 levels.
>
>
> --- In amibroker@xxxx, "Dimitris Tsokakis" <TSOKAKIS@xxxx> wrote:
> > Oversold and overbought levels are usually selected by experience
> and may
> > be not satisfactory for a certain Market.
> > We can change levels in order to give a more reliable description
> of the Market.
> >
> > 1. When we select 30, 70 , i.e. equal distance from 0, 100, we
have
> not any reason
> > to do it. Perhaps 24, 70 for example would be more realistic.
> >
> > 2. I have the following idea:
> > I will examine the oversold time for each stock, I will take its
> average and so I will
> > define the "mean oversold time (MOT)" for the Market.
> > This will be done for an oversold level which gives MOT >5% of
> total days, else oversold is meaningless.
> >
> > 3. Then I will search for a certain overbought level which gives
> the same "mean
> > overbought time". I consider this more fair for the Market,
whereas
> 30, 70 or 20, 80
> > sounds abritary.
> > In other words, I ask levels which share the time equally for
> oversold and overbought
> > phases.
> >
> > Any opinion on this ?
> > (The thought behind the curtain is that buyers and sellers wait
> nearly the same
> > time interval, until they change the trend.)
> > (formulas are almost prepared, I want to discuss the basic
thought).
> >
> > Best regards
> > Dimitris Tsokakis
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