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Tan,
It was the Trend Strength Indicator not the True Strength. They are
similar but are set up differently. Trend Strength indexes the close
above different moving averages. True Strength indexes double
smoothed ROC's.
If the Trend Strength is oscillating that much try reseting your
periods and steps to larger numbers. The default of 10 is good but
you may find that 25 is more to your liking.
You can't expect to capture 100% of a trend without some drawdown.
You should also keep in mind that the markets do not trend all of the
time. You will hear a lot of numbers thrown around for the amount of
trend time...20% is usually accepted. That means that the other 80%
will be in ranges or consolidation.
Capturing 100% of a trend may mean that you will have to step aside
for a bit and then reenter the trade in order to avoid the drawdown.
That's called money management. It is one of a traders biggest
problems.
Weekly values are set on Friday's data. Daily data will always be
more sensitive to changes and reflect more oscillation. If the longer
term weekly is bullish you would only trade bullish on the daily.
Hope this helps,
Preston
--- In equismetastock@xxxxxxxxxxxxxxx, "tan ming"
<reminiscenostalgia@xxxx> wrote:
> Hi,
>
> Personally I found the True Strength Indicator presented by Preston
was
> useful. The indicator works great in identifying trend which are
persistent.
> However when theres a upcoming moderate swing trading range, the
indicator
> oscillate between 100 to -100 instead of persist in upper or lower
range.
> The TSI seeks to quantify the trend degree. Perhaps, a indicator
quantifying
> the trading range degree, taking into account of the ampltitude of
swings
> will complement the TSI greatly.
>
> Preston, with regard to your mentioned abt time frame in
determining of
> strength, I fully agree abt it. I use weekly and daily data to
determine the
> trend. Basically I plot MA on weekly data and if the price is
highly the MA,
> I will look for long in the daily. However I found this has a flaw.
Very
> often I encounter large down swing in the daily despite the weekly
is up and
> vice versa. N in the end I got stop out. Anyone ppl wish to
contribute how
> to utilize different timeframe to determine trend?
>
> MG I found your idea on the use of slope extremely useful. Actually
I did
> monitor the slope of MA but didn't quantify it. U mentioned abt
this idea
> didn't perform as well in the market. What is the main set back of
the lack
> of performing? Personally I think there r more ideas on how to
maximise the
> idea od using slope to determine the maturity of trend such as ROC
(which u
> mentioned previously) on the slope.
>
> Many indicators had devised to determining the trend degree. How
abt
> developing indicator to determining the degree of trading range?
>
> Regards.
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