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metastockuser
The code up to the first PREV is solely for picking the FIRST 4% change.
After that the 'X' variable toggles between +1 and -1 with each 4% reversing
change. If you check the MS User Manual you'll see that Lowest() and
Highest() check every bar under test so far. They can only be used for the
first change in this piece of code. The same thing could be achieved by
using more PREV's. My only contribution to the code was to cut it down from
9 PREV's to just 5 as you see it now.
Roy
----- Original Message -----
From: "metastockuser" <metastockuser@xxxxxxxxx>
To: <equismetastock@xxxxxxxxxxxxxxx>
Sent: Sunday, November 16, 2003 3:55 AM
Subject: [EquisMetaStock Group] Re: Here's an SPY trading System (question)
> I'm not a programer and I'm trying to figure out how this formula works.
>
> when you use the command >lowest(c)< I take that to mean the lowest
> close. But how many closes is it looking at? It appears to me that a
> value of 1 or -1 is being applied depending on if the close is 4%
> above the lowest close or 4% below the highest close, but I'm not sure
> how far back the system is looking.
>
> If somone wouldn't mind a very brief explananation of what that
> program is doing along with the Close issue I'd appreciate it.
>
>
> --- In equismetastock@xxxxxxxxxxxxxxx, manohohman <no_reply@xxxx> wrote:
> > Roy (code refinement) and I (theory and application) took Zweig's old
> > 4% indicator based on the Valueline Geometric Index, updated it,
> > added a twist to it and refined it for trading the SPY Daily.
> >
> > Here's how it works.
> >
> > 1. Instead of the Valueline Geometric Index, this system uses the
> > Valueline Arithmetic Index. (This is an important difference!) This
> > index is $VLE on Esignal. (I don't know what it is on whatever free
> > service you've found so don't ask me.)
> >
> > 2. Once you've opened that Index on a daily chart, color the price
> > line (not bars) red, create the following expert, and apply it.
> >
> > Highlight Code Green
> >
> > X:=If(Cum(Ref(C>Lowest(C)*1.04 OR C<Highest(C)*.96,-1))=0,
> > If(C>Lowest(C)*1.04,1,
> > If(C<Highest(C)*.96,-1,0)),
> > If(PREV=1,
> > If(C<HighestSince(1,PREV<1,C)*.96,-1,PREV),
> > If(C>LowestSince(1,PREV>-1,C)*1.04,1,PREV)));
> > I:=Cum(1)<=2;
> > State:=BarsSince(X=1 OR I)<BarsSince(X=-1 OR I)+(Cum(X=1)=1);
> > State;
> >
> > 3. Since March your price line should be green, except for two red
> > down turns.
> >
> > 4. To this chart apply a simple 20 ma.
> >
> > 5. Open another chart of the SPY daily. Create a new window on the
> > Valueline chart, copy the SPY daily and paste it into the new window
> > on the Valueline Chart. Close the SPY chart.
> >
> > 6. Here are the trading rules. You must follow them exactly. A buy
> > signal is created when either the price line turns green or crosses
> > the 20 dma. You take which ever signal comes first. It doesn't matter.
> >
> > A sell signal comes when the price line turns red or crosses below
> > the 20 dma. It doesn't matter which comes first. You take the first
> > signal from either indicator. You sell the long and take the short.
> > If you're trading in a retirement account, you can't short but you
> > can buy Rydex, Profunds or Potomac on the short side.
> >
> > 7. To avoid whipsaws, you can use a pyramiding technique of buying
> > one third of your buyin at a time. It will limit losses on the
> > whipsaws but reduces your overall return somewhat. It's all in your
> > risk profile. You decide.
> >
> > 7. Since you can't buy the Valueline Arithmetic Index you buy the SPY
> > on the Valueline entry and exit signals.
> >
> > 8. Don't apply this to any other security except the SPY.
> >
> > 9. How good does it work?
> >
> > Over the last 10 years, it's averaged 22% a year, with one small
> > losing year and 40% plus gains the last 3 years. Just take whichever
> > signal occurs first, either the green indicator signal or the 20 dma
> > crossover.
> >
> > This is as simple as TA gets. Use it to your advantage. I got this by
> > paying attention to some of my systems development books. It's about
> > twice as profitable as Zweig's original method, and is about 3 times
> > more profitable than buy and hold.
> >
> > Now isn't this why you bought MS in the first place. I know, don't
> > tell me, all of you arrogant wizard traders won't waste your time on
> > a measely 22% a year unless I can hang a 1 in front of the 22. No,
> > you killer TA masters are going to make buckets of money! Really,
> > well here's an article to put that theory to rest.
> >
> > www.investorhome.com/psych.htm
> >
> > Read this article on behavioral finance and see what arrogance gets
> > you......
> >
> > This system is free, my momma could make money with it, and now you
> > don't have any excuses for losing dough.
> >
> > JO
>
>
>
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>
>
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