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Onno,
The calc's mainly involve computing the tops and bottoms of the up and down
channels. The direction changes when the close strays out of the channel.
At that pivot point you start looking for each of the patterns which are
based on high/low cycles. The target day is an extension of the cycle.
You are always in an up or down channel, and the width of the channel
depends on the parameter you choose. You take a trade if the target day is
still in the channel, either SAR or new trade.
The most difficult part is computing the support/resistance levels and
strengths, which determine the patterns you're looking for. I'm starting
to play with an automated method of support/resistance from the May 1998
issue of TASC. The rest is basic logic programming. If you chart the
targets by hand it's a fairly simple method, after you understand it. I
just can't bring myself to test it with real money.
The method is too long to explain in detail, and the book is copyrighted. I
ordered it from Amazon.com for under $40 US. I like the idea of a system based
on traditional support/resistance and pattern matching, with only one parameter.
I'd like to use MetaStock to chart the channel. That would simplify printing a
chart to validate my Excel calculations. I haven't been able to get around the
recursive nature of the channel. I end up with two indicators dependent on each
other, which doesn't work. Any help along these lines will be appreciated.
Gary Randall - Brunswick, Maine
______________________________ Reply Separator _________________________________
Subject: Re: PAMA trading method
Author: metastock@xxxxxxxxxxxxx at Internet
Date: 8/31/98 9:29 PM
Gary,
Interesting mail!
Can you give us more details about the PAMA formulas and calculations?
Thanks!
Onno
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