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Thanks Richard,
I finally had time to look at your suggestions.
The Stoch(13) appears to yield a picture close to a Weekly Stoch(5). The
weekly Stoch view is smoother though.
Steven Buss
Walnut Creek, CA
sbuss@xxxxxxxxxxx
-----Original Message-----
From: Richard Estes <restes@xxxxxxxxx>
To: Steven Buss <sbuss@xxxxxxxxxxx>; Harvey Pearce <hpearce@xxxxxxx>
Cc: Metastock-list <metastock-list@xxxxxxxxxxxxx>
Date: Sunday, November 23, 1997 6:34 AM
Subject: Re: Oscillator and Trend Following Indicator Integration?
>I suggest MACD(13,34,89) or 89 time series MA for long term trend. The
>oscillator aspect usually gives a 5-10 day trade with say CCI(13) with 200
>and -150 triggers. for longer terms, CCI(40) may stretch it out.
>A StochRSI(13) is used by many to go in and out up the right side of the
>mountain.
>
> What you failed to say is what type trader or investor you are. Say a
stock
>goes from 15 to 55 in a year, would you set tru the corrections to get
>there? Or do you picture 6-8 trades? Your individual mindset decides how
you
>would use the indicators. IMO we have the best under $500 system building
>software out there. Play with it, build YOUR system, so you trust it. When
>opinions say the market will crash or soar, you can turn a deaf ear because
>your system will provide exit/entry points on your stock. It is inline with
>your view of reality.
>
>For those that don't know who they are, they face a hardship of finding out
>with real money. For those without a plan, get one. Even the guy that puts
x
>dollars in a dinosaur every year can come out ahead but he has to have that
>mindset and plan.
>Richard Estes
>-----Original Message-----
>From: Steven Buss <sbuss@xxxxxxxxxxx>
>To: Harvey Pearce <hpearce@xxxxxxx>
>Cc: Metastock-list <metastock-list@xxxxxxxxxxxxx>
>Date: Saturday, November 22, 1997 10:30 PM
>Subject: Re: Oscillator and Trend Following Indicator Integration?
>
>
>>Thanks to Harvey and to all who have replied to my question.
>>
>>The "received wisdom" does seem to be that oscillators work best in
trading
>>range markets and that trend following indicators (by definition) work
best
>>in trending markets. And this makes sense.
>>
>>But I wonder about one thing...
>>
>>Don't oscillators also work well in trending markets when the market is in
>>an extreme position (as defined by an oscillator) AGAINST the trend?
>i.e.,
>>in an up-trending market, when the stochastic is oversold, then, the
>>stochastic indicator does provide information of significant value?
>>
>>So, the restated "received wisdom" principles might go something like
this.
>>
>>- Trend following indicators work well in trending markets.
>>- Trend following indicators don't work well in trading range markets.
>>- Oscillators work well in trading range markets.
>>- Oscillators also work well in trending markets when they have extreme
>>values that run AGAINST the trend.
>>- Oscillators don't work well in trending markets when their value is
>>consistent with the trend.
>>
>>Thoughts?
>>
>>P.S. The Elder insight on this is that the trend is best found by
>examining
>>a trend following indicator at a higher level timeframe than one wants to
>>trade. (e.g., trend established by weekly bars for trade timing
determined
>>by daily bars)
>>
>>Thoughts?
>>
>>Steven Buss
>>Walnut Creek, CA
>>sbuss@xxxxxxxxxxx
>>
>>-----Original Message-----
>>From: Harvey Pearce <hpearce@xxxxxxx>
>>To: Steven Buss <sbuss@xxxxxxxxxxx>
>>Cc: Metastock-list <metastock-list@xxxxxxxxxxxxx>
>>Date: Saturday, November 22, 1997 10:25 PM
>>Subject: Re: Oscillator and Trend Following Indicator Integration?
>>
>>
>>>Steven/
>>>
>>>You bring up a point that I've been toying with. I was hoping that one
>>>of the more experienced members would reply, but since they haven't I'll
>>>make my own low grade input. I'm a beginner with a greater investment
>>>in books than securities, so evaluate this accordingly.
>>>
>>>The received wisdom is that oscillators work with trading ranges but not
>>>with trends. If this is true then it is more a case of switching
>>>between oscillators and trend-following indicators than of combining
>>>them.
>>>
>>>There is a commercial system called Catscan. The developer, Randy
>>>Stuckey, claims that it is two systems in one: one for choppy markets
>>>and one for trends, with a choppiness indicator to switch between them.
>>>
>>>Perhaps Stochastics, which tells us where we are now relative to where
>>>we've been, could be used in this way. Once it pegs at one end you're
>>>in a trend. Elder points out that it is easier to distinguish between
>>>trends and trading ranges when you're looking back at a completed chart
>>>than at the "hard right edge" as you try to get a glimpse of the future.
>>>
>>>I've tried to make an indicator of my own to show what percentage of the
>>>lookback period has had highs greater than the current high, but ran
>>>into limitations of the MS Indicator Builder. (We need a Visual Basic
>>>add-on). I'll post an accompanying message to see if anyone can help.
>>>
>>>For references I'd recommend the following.
>>>
>>>Trading for a Living, by Alexander Elder.
>>>Technical Analysis of the Futures Markets, by John Murphy.
>>>Schwager on Futures: Technical Analysis, by Jack Schwager.
>>>
>>>Harvey Pearce, Victoria, B.C., Canada
>>>
>>>=====================================
>>>
>>>Steven Buss wrote:
>>>>
>>>> My frustration the last few days led me to try to get a handle on the
>>>> Oscillator (e.g., Stochastic) vs. Trend Following (e.g., moving
average)
>>>> indicator issue.
>>>>
>>>> Maybe I've seen someone lay out a general strategy for understanding
how
>>>> these two indicator types can be used together and just don't
>>remember...I'm
>>>> sure there are multiple approaches.
>>>>
>>>> But I did come across Alexander Elder's "Double-checking beats
>>optimizing"
>>>> article in a little booklet he sells ("Trader's Guide to Day-Trading")
>at
>>>> his site for $10. If I had read (and understood <g>) this article just
>a
>>>> few weeks ago I would have saved myself some tension as well as a few
>>>> dollars...His site is www.elder.com.
>>>>
>>>> Anyone know of anyone else who has specified a clear view of HOW
>>Oscillator
>>>> vs. Trend Following Indicators can be used together?
>>>>
>>>> Steven Buss
>>>> Walnut Creek, CA
>>>> sbuss@xxxxxxxxxxx
>>>
>>
>
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