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John,
Dusant has made some valid points in this discussion. The ZZ's are
just not reliable. There have been numerous discussions about this
very same problem in the past. Even Metastock will warn you to use
caution when using this indicator. That being said, if you have a
system that works and that you are comfortable with, then by all
means enjoy it!
Preston
--- In equismetastock@xxxxxxxxxxxxxxx, "Dusant" <cooldush@xxxx> wrote:
> John,
> The point I was trying to make was not that ZZ is a faulty
indicator.
> The point was, a "perfect" system CAN be made using the ZZ, when
the
> buy/sell criterion will show up on an expert, after the fact.
> I appreciate your using ZZ to explore for tops or bottoms, as long
as
> you keep a tight % range, and can be confirmed with other technical
> tools, like divergences.
> And when JM asked about testing an expert, I only suggested that a
> certain portion of the data can be deleted, and then tested for the
> efficacy of the math.
> If not for anything else, to satisfy YOURSELF about the comfort
zones
> of using the indicator/expert/system.
> Spyros has used ZZ in a system, where he has FIXED and pinpointed
the
> % change of ZZ to identify turning points.
> It makes no sense when a signal is generated on a certain date
which
> disappears later. Or, a signal which is NOT generated on a
particular
> date, which appears after three or four trading sessions.
> That was the only point which I was trying to make.
> In all humility, I hope others also take this point.
> Best to all in trading.
> Dusant
>
> --- In equismetastock@xxxxxxxxxxxxxxx, "John Doe" <ms001122@xxxx>
> wrote:
> > Dusant,
> > I think your criticism of the zigzag indicator is too harsh.
> Initially, I
> > also had problems with it as its a tricky indicator to understand
> but after
> > months of use and research, I have finally figured it out how to
use
> it
> > correctly. I am not prepared to reveal my code but suffice it to
say
> that
> > the info in Metastock's help is grossly inadequate. I use
> explorations based
> > on the ZZ every day and the signal is triggered the very same
day,
> NOT
> > "after-the-fact". Of course, as with any trade, some are
profitable
> and some
> > are not. This, of course, is not the fault of the indicator - it
> just did
> > its job; what happens next and how you manage the trade are
beyond
> the
> > indicator's control!
> >
> > I use the ZZ, as an example, to identify DoubleTops (over a short
> time
> > frame) and use various %ages. e.g. On 8/8/03, the 4%ZZ indicated
a
> > short-term Double-Top in Intel (symbol INTC) when it traded and
> closed below
> > the Trough low of 23.73 (made on 7/25/03) and the prior swing
> closing low of
> > 23.97 (made on 7/24/03). [Note: No recommendation is being made
to
> Buy or
> > Sell; what you do with this information is up to you. I am not
> responsible
> > for your trading losses, if any.]
> >
> > If you so wish, over the next couple days I will post some more
> DoubleTops
> > the same day as they occur (I run my explorations EOD) so you can
> satisfy
> > yourself that ZZ can indeed trigger events the same day as they
> happen, not
> > after-the-fact.
> >
> > ==========================================================
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