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Alan,
I still prefer to draw my intermediate and long term trend lines the
Trader Vic way and then make my channels with a parallel line at the opposite
extreme since there is no ambiguity in drawing such channels. For short term
channels, I have been using Raff Regression Channels because they usually
result in fewer false breakouts. As you indicated, the problem with Raff
Regression Channels is to decide where to start and end them. For up
channels, I start them at the lowest low in the period I'm looking at which is
usually the low just before a down trend break out. I end them at a high and
then extend them to the right. If the current close is not a new high, I
don't change anything. If the current close is a new high, I stretch the end
of the channel to the new high. However, for the channel to be valid, I
require at least one higher low from the first low followed by a new high.
The problem is to subjectively decide if there was enough of a pull back for a
good higher low <G>. Downtrend channels are just the mirror image.
Jim
-----Original Message-----
From: Animal Mother
Sent: Wednesday, June 11, 1997 12:21 AM
To: metastock-list@xxxxxxxxxxxxx
Subject: Raff Regression Channels/Andrews Pitchfork
I've been using--and continuing to experiment with--the RRC, without having
ever read anything in any books about it. I've been using it pretty much as I
would a typical (which for me is drawn Trader Vic style) trend channel. For an
up trend, I begin the channel at a reaction low at some point in the past
(often at a major reversal point) and end it at the most recent reaction low.
I reverse this for down trends. I've experimented with starting at the low,
and ending at a recent high, with sort of blechy results. . . .
I'd like to know how others draw these channels.
Also, anyone use Andrews Pitchforks? All I know I read in a very superficial
TASC article a few months back. The only time I seem to get decent signals is
when prices make tidy minor reactions. Any experiences/hints here?
I like using trendlines to trade. In fact, I haven't found any of the
esoteric indicators (R-Squared, Slope) to give better signals (worse, in fact,
since I never got them to work for me) than a combination of MA's (I use 5,
13, 21, 55), trendlines, and a momentum indicator, either MFI, ROC, or RSI,
whichever has been giving the best signals most recently for any given stock.
I sometimes check one momentum indicator against the other--they aren't all
the same, regardless what the books say, especially when volume is in the
formula.
I look forward to reading some of your responses.
Alan M.
___________
"Better you than me."
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