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USE OF THE ADX: INTERMEDIATE STOCK MARKET TREND?


  • To: "OMEGA LIST" <omega-list@xxxxxxxxxx>
  • Subject: USE OF THE ADX: INTERMEDIATE STOCK MARKET TREND?
  • From: "charles meyer" <chmeyer@xxxxxxxx>
  • Date: Mon, 14 Dec 1998 16:13:30 -0500 (EST)

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Group:

I was told that the following shows good results using the ADX.
Perhaps I can kill two birds with one stone and we can all benefit?
I have been struggling with the code but gave up due to frustration
and other projects.  Maybe this would be a good time to submit
this idea to more experienced ela programmers.  First I'll submit
the idea in plain language, share what code I was given by the EL
department.  Hopefully someone can finish the code and backtest the
idea?  Here are the 'rules' of the system.  It uses a seven (7)
week lookback period to determine trends in the Nasdaq Composite
Index (or perhaps the trend in other indexes).  Restated, it uses
WEEKLY data.  Here are the rules.  


1.  Using a seven (7) week lookback period, a buy signal occurs
after the +DI crosses above the -DI AND there is an uptick in the
ADX.

2.  A sell signal occurs after the ADX drops by more than four (4) points. 

Here is what the EL Department gave me for Inputs:

Price       Close
Len          7
ValPoint   4
AdVal       ADX[7]

Here is what the EL Department gave me for Formula:

AdVal-AdVal[1]>=ValPoint points
_____________________________________________________________

Something about this is probably not correct or I would have been able to
go further with the idea.  For some reason, I could not get this to work
correctly.  Perhaps I did not clearly explain the rules or did something
else wrong.  Truthfully, I haven't been able to really use my SC's due to
ignorance and frustration.  Hope this note is not off topic or not of
interest.
If this is not clear; I'll keep explaining until I accurately communicate
the
idea.

Charles