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Bob,
>> What is the proper time duration to label a daily bar chart as in
consolidation for the purposes of coding an indicator to identify when a
breakout occurs?
There is no rule that I am aware of that says a market
must consolidate prior to a breakout. I have seen markets perform
trendline, triangle, flag, pennant and other breakouts without any preceding
consolidation period many times. Case in point would be a V bottom or top
which we see quite often in the Futures markets. No consolidation just a
firm and decisive change of trend. Personally I measure the validity of
breakouts by the closing price and the markets ability to move in the breakout
direction for no less than 2 days after the potential breakout
signal.
>> Specifically do you look at price range, averages,
stochastics, or some combination?
I judge the validity and strength
of breakouts by the closing price relative to current market price
patterns, momentum, velocity, acceleration and several other predictive
measures. I do not use the standard lagging indicators such as
Stochastics, Moving Averages or MACD at all.
>> Do you look at something that I haven't mentioned.
See my response to the previous question.
Hope this information is of some help to
you.
God Bless and best wishes in all your future
endeavors,Tom
<BLOCKQUOTE
style="PADDING-RIGHT: 0px; PADDING-LEFT: 5px; MARGIN-LEFT: 5px; BORDER-LEFT: #000000 2px solid; MARGIN-RIGHT: 0px">
----- Original Message -----
<DIV
style="BACKGROUND: #e4e4e4; FONT: 10pt arial; font-color: black">From:
Robert
Baker
To: <A title=realtraders@xxxxxxxxxxxxxxx
href="mailto:realtraders@xxxxxxxxxxxxxxx";>realtraders@xxxxxxxxxxxxxxx
Sent: Friday, March 29, 2002 1:09
PM
Subject: [RT] TECH: CONSOLIDATION
I have been a lurker for many years and have seen topics oscillate around
the relevant but I have a specific question which requires your opinion.
What is the proper time duration to label a daily bar chart as in
consolidation for the purposes of coding an indicator to identify when a
breakout occurs? Specifically do you look at price range, averages,
stochastics, or some combination? Do you look at something that I
haven't mentioned. I am purely a technical trader but I am always
looking for better ideas.
bobTo
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