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How do I open up the attached file? I use Eudora Pro.
Lionel
At 09:37 AM 6/24/98 -0700, John Sellers wrote:
>If possible could you include an attachment in your e-mail showing an
example of a graph which you feel shows a good representation of this
indicator providing a good signal for a move on the upside.
>
>Your mail was written well and easy to comprehend, thanks.
>
>I use bollinger bands about the last price of the stock with two and half
deviations plus an indicator "Money flow" with similar bollinger bands
wrapped about that indicator. I look for cross overs for possible buys.
Also touching or penetrations of the lower bollinger band of the indicator
which show a divergence with the price movement indicate a good entry. For
instance a second bottom of the indicator not as low as the previous one
but coupled with two price lows where the latest one is the lower one would
present an attractive entry point. Both ideas appear to function well when
the market is in an up move but not in a corrective mode.
>John Sellers
>Torrance, CA
>USA
>
>-----Original Message-----
>From: A.J. Maas [SMTP:anthmaas@xxxxxx]
>Sent: Tuesday, June 23, 1998 5:23 PM
>To: Metastock List
>Subject: Histograms - "MACDHis1-MV" + "MACDHis2-AE" - the making of + its
confusion explained
>
>Below is a copy of the original web-page!
>D:\Equis\Z-Divers\faq-MetaStock\TASC\errata.htm
>
>Regards,
>Ton Maas
>Ms-IRB@xxxxxxxxx
>
>
>----------------------------------- From TASC mag - its Errata page
---------------------------------------------
>APRIL 1997
>
>
>The following correction was sent in by Mark Vakkur, author of the April
1997 article "The moving average
>convergence/divergence histogram."
>
>While producing the April issue, we noticed too late the discrepancies in
Figures 1 and 4 between the author's original
>hard-copy charts and the files he created for the article, because the two
indicators (the MACD and the MACD histogram)
>are so similar. We apologize for any inconvenience caused by the error. --
Editor
>
>
>Mark Vakkur writes:
>
>Contrary to how it was named in the article, the indicator I presented in
my April 1997 article, "The moving average
>convergence/divergence histogram," was actually a variant of the MACD
indicator itself, not of the MACD histogram, which
>is an indicator described by Alexander Elder in Trading for a Living.
>
>In my article, I used SuperCharts to create a user function, MACDHis,
defined as follows:
>
> MACDHis = MACD(close, shortma, longma)/
> MaxList(close,1)*100
>
>In plain language, this is simply the difference between two moving
averages (that is, the MACD indicator) of lengths
>shortma and longma, divided by the close (I used the MaxList function to
ensure against divide-by-zero errors). I
>multiplied this result by 100 to create a more readable number, then
plotted the result as a histogram.
>
>However, to clarify matters, this is not the MACD histogram as described
by Elder in Trading for a Living, which would
>be defined as the MACD minus its signal line, plotted as a histogram. The
SuperCharts formula for that indicator would
>be:
>
>MACDHis2 = MACD(close, shortma, longma)-xaverage
>(MACD(close, shortma, longma), thirdma)
>where thirdma is the length of the signal line (for example, 6 in a
12/26/6 bar system). This could then be divided by
>the close and multiplied by a large constant to normalize the result. At
any rate, as discussed in the article, the
>value of the indicator is unimportant; what matters is its trend.
>
>The rest of the article, including the systems presented and their
results, is essentially correct once you substitute
>"MACD indicator" for "MACD histogram" throughout. Figures 1 and 4 shown
here have also been modified to reflect this
>correction.
>
>The system I used is as follows:
>
>Long entry:
>
> Buy stop high[1] if
> MACDHis(SHORTMA,LONGMA)MACDHis(SHORTMA,
> LONGMA)[1]
>
>Long exit:
>
> Sell stop low[0] if
> MACDHis(SHORTMA,LONGMA)<MACDHis(SHORTMA,
> LONGMA)[1]
>
>
>For testing purposes, I disabled any short selling and used no stops.
>
>I apologize for this error and hope it did not cause too much frustration
for readers. I appreciate the feedback from
>readers and from the editorial staff of STOCKS & COMMODITIES, which led to
my discovery of the error (mainly through
>their failure to replicate my trading system results). Moreover, the
comments I received from readers demonstrate that
>readers are taking to heart the magazine's frequent advice to accept
nothing at face value but to test everything before
>risking a dime. Thanks for the feedback.
>
>Mark Vakkur, M.D.
>vakkur.mark@xxxxxxxxxxxxxxxxxx
>
>-----------------------------------------end of
page--------------------------------------------
>
>
>
>
>
>
>
Lionel Issen
lissen@xxxxxxxxxxxxxxxx
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