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Hi guys,
Monday, June 30, 2003, 4:46:44 PM, you wrote:
s> --- In amibroker@xxxxxxxxxxxxxxx, "mrdavis9" <mrdavis9@xxxx> wrote:
s> I would appreciate any and all suggestions regarding what criteria
s> that I should put into my buy scans that would insure that the stock
s> is truly in an uptrend, in order for it to be eligible to receive
s> a buy arrow. Regardless of the other suggestions that may be
s> forthcoming, I still want to test the concept of positive linear
s> regression.
s> =======
s> Can't help you with the regression line, but what was your reasoning
s> for avoiding indicators like ADX or Aroon for trending?
Adx measures strength of trend, not direction, of course. With that
caveat, it sure could be used.
I would chip in here with a loose paraphrase of a comment that I read
in a book by Dave Landry some time back. Don't make this very
complicated at all. Look at the chart, and make a pretty quick
decision. Basically as I remember it, Dave wrote, "If in any doubt
[about trend], ask the first 6-year-old child that you see, and go
with that child's opinion."
That's basically it, silly as it sounds. Choose some simple criteria
and plug them in. The only thing you have to basically do is to
decide how far back you want to look. In my opinion, if it survives
a retracement or consolidation, then resumes and makes a new
intermediate high or new intermediate low, it's a trend. This is a
variation of the old "if it walks like a duck, and quacks like a
duck, it might very well have a darn good chance of actually being a
duck" theory. ^^_^^
You could waste eons of time on this and make yourself just short of
crazy, or even worse. I doubt if it would be worth it. In the end,
your unasked question is probably, "How long does a trend have to
persist before it's a *safe trend* that I can get onboard and ride?"
There is no answer to this question, of course. There is only trade
management and money management. Any "proven" trend may "un-prove"
itself immediately after its "proof" has been declared. It's part of
the business.
Proof? Sorry, this is raw emotion seasoned with random noise, and a
dose of manipulation thrown in to keep everyone *really* on their
toes. This is not geometry class.
Best,
Yuki
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