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The Omega Man wrote:
>
> Bert,
>
> It would appear that, because you are using a 9 day standard deviation of
> closes, your need is to estimate where today's close is going to be before
> the end of today's trading. Is that correct?
Yes and No.
I thought the bands were influenced by the trading range for the day
and not only the close.
Am I mistaken?
I'm trying to determine, to a high degree of probability, if the
market moved outside the bands today. The band spec.'s are not the
issue. What I'm trying to do is say, "If the market closed NOW (at
any time during the trading day) would there have been a band cross
over.
>
> If it is, then do we need to bother at all with the range up to noon, the
> open, etc?
No, other than a way to create some alerts. I would use the open to
calculate initial targets for the day. If price hit one of those
targets I'd then recalculate to see if the movement stayed outside
the revised bands. Obviously you would be able to revise the bands
any time during the trading day. If you waited to calculate just
before the close you could miss a good part of the stabilizing move.
That is why I didn't want to wait until EOD in the first place.
>
> All the best,
>
> The Omega Man
>
> ----- Original Message -----
> From: Bert <mbcsne@xxxxxxx>
> To: <omega-list@xxxxxxxxxx>
> Sent: Wednesday, June 09, 1999 10:55 PM
> Subject: Re: Bollinger Bands
>
> > I have tested a trading method I call "Snap Back" that seems to show
> > some promise.
> > My tests have been visual since I am not very proficient at writing
> > systems in TS.
> > The indicators (Show ME) are simple enough. Sell if close is above
> > the high Bollinger Band and Buy if the close is below the lower
> > Band. These are very short term positions, 1 to 3 days.
> >
> > The problem is estimating what the band value will be before the end
> > of the trading day.
> >
> > Using Trade Station, can some give me a formula that would allow me
> > to
> > estimate or interpolate what the daily high and low band might be
> > based on the open, the range open to noon, and finally, the range up
> >
> > to 1/2 hour before closing???
> >
> > It occurs to me that if I could could get some indication of where
> > the bands might be today (before the market closes) it would improve
> >
> > the chances of capturing the incremental stabilizing moves of an
> > equity to stay within the standard deviation expressed by the
> > Bollinger Bands.
> >
> > I may be all wet but it appears that this approach might produce
> > some real gains.
> >
> > Thanks for any insight you can provide.
> > Bert.
> >
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