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Attached are two probability cone charts that reference first the 01/05
swing date on Clydes chart and then Friday's close. The percent numbers are
the area within each cone. They are also referred to as probability of
occurrance that price will fall within that cone. Note that as volatility
picked up going into 01/09 the cones opened up more to include a wider
price range per day. On ConeA prices had been tracking within a one
standard deviation cone until Friday when price dropped to -2 std dev
referenced to 01/05 cone. A 2 std dev move is typically an exhaustion
move. Basically Cone A is confirming the Swing Machine Low from a
probability standpoint.
BobR
At 05:07 PM 1/10/98 -0600, Clyde Lee wrote:
>Folks,
>
>BobR suggested that maybe the VOLATILITY bugaboo
>should be included in SwingMachine calculations. Before
>I killed myself trying to add that to an already overcoded
>program I decided to look at a full data set from 1900-1998
>(thanks to Gitanshu Bush) and a shorter set covering only
>1990-1998.
>
>The attached .gif indicates that it is highly likely that
>volatility should be included in the calculation. Both
>pictures show roughly the same maximum low but
>the other lows and ultimate highs in next leg change
>quite a bit.
>
>I hope this helps in evaluating your analyses.
>
>There were 365 swings in the long term data set
>and only 65 in the short set.
>
>Clyde
>
>
>
>--
>- - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
>Clyde Lee Chairman/CEO (Home of SwingMacine)
>SYTECH Corporation email: <clydelee@xxxxxxx>
>7910 Westglen, Suite 105 Work: (713) 783-9540
>Houston, TX 77063 Fax: (713) 783-1092
>- - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
>
>
>Attachment Converted: "c:\eudora\attach\djda0098.gif"
>
Attachment Converted: "c:\eudora\attach\DJIA2.gif"
Attachment Converted: "c:\eudora\attach\Djia1.gif"
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