Registered User
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As some may know I have changed my trading style to a longer term buy and hold strategy. I said that I would work on developing indicators that would help me to uncover good buying opportunities and the first of many (I hope) is here.
I call it THE FAN.
In my reading I stumbled across an article that was written by some expert-trading guru, he suggested that the only indicators he used to make his fortune were moving averages. Now I have heard over the years that most successful trader’s rely on three things, Volume, Price and Moving Averages, so why not give it a shot?
For the last four to five months I have been studying the relationship between price and their moving averages. This study along with the fact that my long-term holdings were quietly out performing the rest of my portfolio prompted my decision to pursue long term as the main drive of my investing.
The following chart is an example of my new Template. In the top window I have price with exponential moving averages 55, 84, 116, 150, and 200, 300, 400
In the bottom window I have a percent true indicator that will let me know on the first day these moving averages all lined up in ascending order. And the indicator will stay true as long as the moving averages are in line. I plan to sort with this indicator by actual value, a value of 100 will be true and a value of zero will be false. (The watchlist I sort will have filters for volume and quality).
In the middle window I have a Diceman type indicator that will let me know when the moving averages are close together, but unlike the HNC template I want to know when the indicator is actually past the decision point and the FAN is starting to form. I have added a 100-day moving average to the indicator that shows me this. In other words when the indicator crosses the 100-day moving average it is time to start looking for an entry point, given that the indicator in the bottom window is true.
Entry and Exit is up to you, I personally use candlesticks and Stochastics. Any way here is a couple of charts to show how I have set this up. The first chart is earlier in time than the second so that you may see how the FAN develops. They are of different securities but you will get the idea.
I welcome and would appreciate any and all feedback.
Apsll..
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Registered User
Joined: 4/18/2005
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I read somewhere that the most consistantly proffitable systems tend to be trend following systems... And moving averages tend to shine there.
I discussed this with martha and she has a view and teaches that moving averages aren't that reliable, particularily crossoverscan be late signals..... I disagree with this as a flat statement. Of course I could show you settings where a MA crossover would be late..
In general I think they are pretty good and help you see visually trend characteristics. I also think that trend quality type of indicators are important.
I see also that as a general rule that longer holds are more proffitable... I have touble there and also find it satisfying to sneak in and sneak out with a nice proffit for 1-3 day trade. I'm trying to force myself to hold longer now as a general rule but the fear factor inhibits me. So many times I've had a good trade go into loss from over holding. this is probably from aproaching a swign trade chart with a position trade point of view or mixing apropriate targets and stop losses. In beneral I think in terms of my longer holds I want to try to wait for gereral market corrections and bottoms of an intermediate term level or at the verry least catch "NEW" bottoms in individual securities... NOT picking the bottom but after confirmation of a bottom then it can be considered for a longer term hold.
My "system" is essentially a trend following system with an open mind to counter trend bounces based ont he three moving averages I have mentioned in previous threads. In looking att he HNC indicator I noticed that frequently when the longer MA's converged that they tended to mark bigger swings over larger periods of time. I found so many lines distracting so I felt like those three were a good cross section of allof them with the addition of 100 day ma. as a ultra base for the trend.
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Registered User
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Scott thanks for your response, I have a few bugs that I am working on with the indicator in the bottom window.
This indicator will not be as popular as the HNC/Diceman template because it involves longer term holding which is not popular on this forum. Most want quik results and fast profits. Hey I used to play that game too so I cannot blame them. But for those looking for larger profits over a longer time period then this could be it..
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Registered User
Joined: 12/21/2004
Posts: 902
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Hey Apsll that was my thought when I saw the lengths of your MAs - wow - this is for longer-term holdings.
I'll tell you one reason why I go for the shorter holdings (although I do have several holdings that have lasted years) - it's TC2007! I get so excited over some of the stocks I find and want to get in so badly, that I regularly agonize how to cull my portfolio to provide the room. It's not nearly as much fun playing on paper - and TC2007 wouldn't be nearly as fun if all my holdings were longer term LOL
I'm looking forward to spending some quality time with your new system over the long weekend
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Registered User
Joined: 3/21/2006
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Thanks Hohandy, Bruce L. was kind enough to help me refine the indicator in the bottom window. Try this formula for a percent true indicator that will tell you when the FAN is starting to develope.-
XAVGC55 > XAVGC84 AND XAVGC84 > XAVGC116 AND XAVGC116 > XAVGC150 AND XAVGC150 > XAVGC200 AND XAVGC200 > XAVGC300 AND XAVGC300 > XAVGC400 AND NOT(XAVGC55.1 > XAVGC84.1 AND XAVGC84.1 > XAVGC116.1 AND XAVGC116.1 > XAVGC150.1 AND XAVGC150.1 > XAVGC200.1 AND XAVGC200.1 > XAVGC300.1 AND XAVGC300.1 > XAVGC400.1)
But still wait for the other indicator in the middle window to cross over the 100-day moving average. Here is the other indicator for the middle window -
((ABS(XAVGC55-XAVGC200)+ABS(XAVGC116-XAVGC200)+ABS(XAVGC300-XAVGC200)+ABS(XAVGC150-XAVGC200)+ABS(XAVGC400-XAVGC200))/XAVGC200)*100
You can still trade some short term with this set-up. There is no rule that says you cannot take profits early. Belive me I know the thrill of the short term game. I have just decided that I want to retire as soon as possible, and (IMO) HNC, Diceman, and Memorableproducts are right when they promote good quality, trending, institutionaly driven stocks. And that short term trading should be a very small portion of ones portfolio..
Any way this is my first contribution. I hope that some will find value in it..
Apsll...
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Registered User
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((ABS(XAVGC55-XAVGC200)+ABS(XAVGC116-XAVGC200)+ABS(XAVGC300-XAVGC200)+ABS(XAVGC150-XAVGC200)+ABS(XAVGC400-XAVGC200))/XAVGC200)*100
Gives me a formula error. is this % ture also or cumulative just indicator?
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Registered User
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Scott,Just indicator. Use it like you would use the Diceman indicator. (It basicaly is the Diceman indicator with different values pluged in)
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Registered User
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I get formula error not enough data to calculate?
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Worden Trainer
Joined: 10/7/2004
Posts: 65,138
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scottnlena,
Please try changing your Test Symbol to something with more data (like IBM). You may wish to review the following:
How to create a Personal Criteria Forumula (PCF)
-Bruce
Personal Criteria Formulas
TC2000 Support Articles
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Registered User
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I think I got it working..... Neither indicator shows up verry often.. and it could be the segment of the watchlist I'm on.
RYI the top indicator spiked on 1/17/07 and then dropped imediately. the lower indicator crossed up on 1/24.
but then what are your indicators telling me on TLM in febuary?
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Registered User
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out of curiosity have you played with price crossing its 50 ma in terms of a % ture indicator?
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Registered User
Joined: 4/18/2005
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fo on IBM would you consider Feb's price action a sell or early aprils action a sell based on:
((ABS(XAVGC55-XAVGC200)+ABS(XAVGC116-XAVGC200)+ABS(XAVGC300-XAVGC200)+ABS(XAVGC150-XAVGC200)+ABS(XAVGC400-XAVGC200))/XAVGC200)*100
activity with it's moving average?
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Registered User
Joined: 3/21/2006
Posts: 4,308
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Scott the bottom indicator only tells you when the moving averages lined up on that day but the previous day they did not. It will be the nature of the indicator and the watch list you are scanning that will determine the amount of hits you get.
TLM in February did get a hit in the bottom window indicator but the middle window indicator is the more important of the two indicators, and in february the middle indicator did not cross the zero line. However in April it did and (IMO) this stock is still in a prime buying area..
A good example for this set-up right now is PDLI -
also look at SAPE..
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Registered User
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This template is only designed to show good entry areas, not sell. You do not sell if the middle window indicator drops below zero. I still think that IBM is a good buy right here on this pullback.
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Registered User
Joined: 1/28/2005
Posts: 6,049
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I like this type of idea a lot.
(I have always wondered if the inverse of this would
be a good way to select long-term shorts, never
got around to looking, long is so much more fun)
Longer-term holdings tend to beat out short-term
trading in strong bull markets.
One thing to consider is some type of exit strategy
for a bear market.
It would have been a shame to be holding tech with this
system in 2000. Then watch it all disappear and then some.
Also check out the Worden reports of: July 15 2005 and
March 8 2006.
Thanks
diceman
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Registered User
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Think of the bottom window indicator as a scout or reconnaissance tool. Then the middle window indicator crossing zero is when you bring the troops in..
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I feel like I am in one of those twilight-zone episodes. How strange. I know that my ideas are not completely original (others of coarse have used Moving averages in this way) but the name (FAN) I did think that all mine. I do not recall reading those particular notes, but there they are..
At least I am in good company, if these Sir Nights like the FAN then I feel more confidence in the success of this Template.
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Registered User
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Diceman, Thanks for pointing those Worden notes out to me, makes me realize that what ever idea you can think of, there is a good chance that it has been done before.
You have said many times that you let the stock tell you when to exit, so now that are trading styles are a little more alike, what is it that you see in the charts that tells you it is time to sell. A moving average being breached, an indicator acting negative, or perhaps a fundimental break-down.
I have always exited on candlestick patterns but long term is more complicated then that I think. HLTH is a stock that I have held since 2001 and I am sure that there were times that I should have sold it, but because my sister works for that company I just held in confidence. I have been rewarded for my patience many times over and I am still holding.
"One thing to consider is some type of exit strategy
for a bear market".
Do you have any ideas for this yet?
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Registered User
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OOPs I have them reversed... so for my coments above consider biddle as bottom and veceversa.
ON PDLI I don't get the spike in your white indicator?
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Registered User
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Scott, it actualy came up for yesterdays scan. I did not update for today when I ran the scan. It should still show up for yesterday though...
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Registered User
Joined: 4/18/2005
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neither have I...
Price top window.
middle window. should be:
((ABS(XAVGC55-XAVGC200)+ABS(XAVGC116-XAVGC200)+ABS(XAVGC300-XAVGC200)+ABS(XAVGC150-XAVGC200)+ABS(XAVGC400-XAVGC200))/XAVGC200)*100
Exponential with a 100 EXP MA. this is basically the diceman indicator, so low values will reflect the moving averages compressed togeather? plotted just as "indicator"
bottom window:
XAVGC55 > XAVGC84 AND XAVGC84 > XAVGC116 AND XAVGC116 > XAVGC150 AND XAVGC150 > XAVGC200 AND XAVGC200 > XAVGC300 AND XAVGC300 > XAVGC400 AND NOT(XAVGC55.1 > XAVGC84.1 AND XAVGC84.1 > XAVGC116.1 AND XAVGC116.1 > XAVGC150.1 AND XAVGC150.1 > XAVGC200.1 AND XAVGC200.1 > XAVGC300.1 AND XAVGC300.1 > XAVGC400.1)
Plotted as percent true? Dosent show up on PDLI?
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Registered User
Joined: 1/28/2005
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"One thing to consider is some type of exit strategy
for a bear market".
Do you have any ideas for this yet?"
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A lot of this would be based on what you consider "long-term
holds".
For example lets say UGI was purchased in early 03 as
a LTH (longtermhold)
Would the trader want to sit thru the flat period from mid
03 to mid 04? Or the correction from late 05 to early 06?
Some think this is a good practice in a LTH (part of the game).
and some would rather switch horses.
Your style would have to dictate ways to exit or hold on.
For example if you wanted to exit something like
MINL63 would be a good stop level.
My guess would be from what I've seen. A 125 to 150
day mav would make a good filter.
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I tend to prefer weekly charts for LTH stuff. For example
12,26,9 MACD-H is a measure of momentum on a daily
chart. It is a much longer-term measure on a weekly.
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I tend to like the 28 week zone for moving averages. I
also like that I have some "early warning".
I will sell a position if the low goes thru the moving
average. (even if it rebounds during the week and
goes to a new high. I have found this works better
than waiting for an actual close below the average.)
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Also general measures of the market. Is the SP-500
above its 45 week mav? (and so on)
I also like long-term measure of market momentum.
(are we in nose bleed territory?)
Most of mine are my own but they are in the style of
Prings LT KST for example.
You need to determine ways to tell the market is
a screaming buy or dangerous.
(on a long-term basis)
Mainly because this type of strategy would be
highly effective from 2003 to now but gets more
risky as the party continues.
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Remember that part of the process is the MAV filters
and the LT diceman indicator. Hopefully they will
do most of the heavy lifting in the screening dept.
Thanks
diceman
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Registered User
Joined: 9/21/2005
Posts: 566
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Apsll, I give you a lot of credit for designing the approach and all the thought and consideration that went along with it.
I must confess my bias is still on the short-term side of things but that is probably true for most other Telechart users as well.
Jesse Livermore had a saying that the really big money in stocks comes from sitting not from trading. I have pondered that a lot and tried to see if it would work for me but to date it hasn't. Maybe you need Livermore's ability to spot tops and bottoms effectively.
One approah that does make sense to me (this is super long-term) is to ID a new technology or trend with some longevity and buy all the leading companies that are engaged in it. If you are right about the technology, you should be right on at least one of the companies being a good long-term pick. Computer networking and cisco systems is a good example of this, when the technology first began to grow. But along its ride to the top, Cisco had several instances of a 50% retracement in value. I don't think I could have sat through those no matter how much I believed in the technology.
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Registered User
Joined: 3/21/2006
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Thanks Jcfla7, I have recently found out that my idea is not totally original. Just as Darrel Guppy was the original designer of the HNC indicator, the FAN too has been done before.
Any way short term vs long term. It really is based on ones own preference. The only pertinent point is ones ability to make profits as quickly and efficiently as possible, because who knows how long we will have the oppertunity to do so...
Most on this forum already know that I have been a huge advocate of short term trading for some time. There are a few very colorful threads that you can search for where I have debated this very topic.
But recent events have forced me to re-evaluate my position on this. I guess the best way to demonstrate what I am trying to say is to show you one of a few examples.
LBY was a stock that I was trading short term fairly successfully for a few months leading up to late September 2006. I lost interest in the stock as it fell into a semi long consolidation from October 2006 to January 2007 (Most short term traders would have lost interest in LBY during this time also in search for other opertunities) But knowing from experience that these consolidation patterns will eventualy lead to a resolution to the upside or down, I vowed to be there when it did.(I had a gut feeling that this stock was going to be a good momentum runner). It was HNC's thread back in January that planted a seed in my subconscious about swing trading momentum stocks. I had been doing this already in my own (short term) way. But it made me think that these momentum stocks always seem to recover from the minor pullbacks and head for higher ground, why not just ride them out instead of selling.
So in mid Feruary I bought LBY and decided that I would hold for the long term (I was tested pretty hard with a down trend in late February and early March)but I held on. I was taking a chance because I bought 3,000 shares so I could not be reckless.
The results I think speaks for itself the stock is up 75% from the $12 price I bought at. I had similar results with a few other securities in this same way.
AOI
HLTH
TMX
Just to name a few. I tell you now that I have never seen these types of profits in the same time frame as I did with my short term approach. Thus my re-evaluation, and change of heart. Here is a couple of charts so you can have a visual...
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Registered User
Joined: 3/21/2006
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In my opinion LBY is still in a buy zone. The moving averages are not completely lined up yet. (wait for a pullback). The next chart is AOI.
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Registered User
Joined: 10/7/2004
Posts: 1,178
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Hello to THE FAN participants,
In following your very interesting discussion of diceman's idea for longer-term trading, I have replicated the chart this morning, with the exception of the bottom window.
QUOTE (scottnlena) neither have I...
bottom window:
XAVGC55 > XAVGC84 AND XAVGC84 > XAVGC116 AND XAVGC116 > XAVGC150 AND XAVGC150 > XAVGC200 AND XAVGC200 > XAVGC300 AND XAVGC300 > XAVGC400 AND NOT(XAVGC55.1 > XAVGC84.1 AND XAVGC84.1 > XAVGC116.1 AND XAVGC116.1 > XAVGC150.1 AND XAVGC150.1 > XAVGC200.1 AND XAVGC200.1 > XAVGC300.1 AND XAVGC300.1 > XAVGC400.1)
Plotted as percent true? Dosent show up on PDLI?
In entering the above as a Custom Indicator, the result was an error message upon testing: "The formula must not return a boolean value for a formula indicator."
Can anyone help me with the correct formula, although I am not terribly familiar with custom indicators or sophisticated boolean logic.
Wishing all participants a happy Memorial Weekend.
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Registered User
Joined: 1/28/2005
Posts: 6,049
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You must use it as a
percent true indicator.
(it is a true/false condition.)
Notice the bottom of the UGI chart.
(the green line shots up when the
condition is true)
Thanks
diceman
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Registered User
Joined: 10/7/2004
Posts: 1,178
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Diceman, hanks for answering so quickly.
Here's where I am now:
1) When I ran this same formula as a PCF using All Stocks in an Easy Scan with no other criteria,the scan eliminated all but 12 stocks. The list began with GW and ended with WTM (alphebetical). So all was well there, I think.
2) However, when I scrolled backwards trying to locate any spike in the bottom window (even using UGI as my stock symbol), there were no spikes.
3) And, in addition, on the top line of the bottom window remains the error message: "FORMULA ERROR".
I am asking myself: perhaps there is something I did not check in the Custom Indicator? I have tried checking various boxes such as "Center Zero Line", "Plot using price scale", "Simple" and "Expoential"? Yet, none of these change the error message.
Perhaps it is normal for the chart to show an error messag? Except for on the EXACT DAY that the formula would would trigger causing it a spike to appear on in the bottom chart.
At this time, I remain puzzled... 
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Registered User
Joined: 1/28/2005
Posts: 6,049
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This is in the middle window:
((ABS(XAVGC55-XAVGC200)+ABS(XAVGC116-XAVGC200)+ABS(XAVGC300-XAVGC200)+ABS(XAVGC150-XAVGC200)+ABS(XAVGC400-XAVGC200))/XAVGC200)*100
As this goes higher the averages are spreading apart.
Down the are getting closer together.
Plotted as a custom indicator. Click on the
indicator and select add indictor to add the
100 day moving average.
-----------------------------------------------------------------------------
I believe this is the white spike indictor.
Plotted as a percent true at the bottom:
XAVGC55 > XAVGC84 AND XAVGC84 > XAVGC116 AND XAVGC116 > XAVGC150 AND XAVGC150 > XAVGC200 AND XAVGC200 > XAVGC300 AND XAVGC300 > XAVGC400 AND NOT(XAVGC55.1 > XAVGC84.1 AND XAVGC84.1 > XAVGC116.1 AND XAVGC116.1 > XAVGC150.1 AND XAVGC150.1 > XAVGC200.1 AND XAVGC200.1 > XAVGC300.1 AND XAVGC300.1 > XAVGC400.1)
The spike tells you the first day the averages are all above
each other. (and only the first day)
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Unless I've have missed something the green indicator at
the bottom was not supplied.
I believe it is this. Plotted as a percent true:
XAVGC55 > XAVGC84 AND XAVGC84 > XAVGC116 AND XAVGC116 > XAVGC150 AND XAVGC150 > XAVGC200 AND XAVGC200 > XAVGC300 AND XAVGC300 > XAVGC400
This shows the whole time the averages are above each other.
Thanks
diceman
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Registered User
Joined: 10/7/2004
Posts: 1,178
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Diceman,
Thanks for your help in pointing out the two colors (I missed the green) and offering all the formulas for FAN.
On my screen, I am unable to read the tiny print of the custom formulas posted at the top of the bottom windows and saw the two colors, but didn't realize there were two different formulas.
I did double-check the formulas you kindly offered with the ones I had. I entered both the white and the green as regular PCFs and as Custom Indicators.
 Regarding the green spike formula, it shows some True statements in the tab (working correctly), but gives an error message in custom indicator.
Regarding the white spike formula, it but gives me errors in both the custom indicator and I see all blanks (no True/False statements) in the tab.
So, I still have a challenge with these bottom window formulas. Perhaps, others have figured this out.
When the weekend is over  and rain  returns to Seattle, I will continue to playfully play with these wonderful new tools.
One more thing... this is the PCF I have for the top window, and I am wondering if it is completely accurate. Should it be extended to AvgC400?
(C > AVGC10 AND AVGC10 > AVGC20 AND AVGC20 > AVGC50 AND AVGC50 > AVGC100 AND AVGC100 > AVGC200)
Thanks to apsll and all the others who have so generously contributed to the invention and discussion of the FAN strategy.
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Registered User
Joined: 1/28/2005
Posts: 6,049
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Re-read my post.
It is stated if the indicators should be a custom
indicator.
(a value that changes)
Or if they should be a percent true
indicator.
( a true/false type statement)
I would concentrate on trying to make the charts look
like apsll's and seeing if you can get them to agree.
The scan tool would be the white spike indicator.
(the first day all the averages are above each other)
Realize that there probably won't be many per day
because this is a unique condition.
Thanks
diceman
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Registered User
Joined: 10/7/2004
Posts: 1,178
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Diceman,
My chart does look like apsll's with one exception: the bottom window.
When I use apsll's example (MEDX or UGI) in charts, everything is the same as apsll's -- except the absence of any spike's on my charts.
I DO realize that the spike will be a rare condition. What I am wondering though is WHY I get an error message in the bottom chart ("FORMULA ERROR!!! Must not be a boolean formula").
I AM using the exact formulas you so considerately provided. Even when I scan all the way back on MEDX and UGI, there are no spikes anywhere.
I am asking myself if this a glitch in my TC software as I had an earlier problem on Friday before the end of the trading day while working, with Bruce, the trainer, unable to get the same numbers he got.
Thanks for your input. All opinions are welcome and appreciated. 
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Registered User
Joined: 1/28/2005
Posts: 6,049
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Using this as a percent true:
(the second formula in my post above):
XAVGC55 > XAVGC84 AND XAVGC84 > XAVGC116 AND XAVGC116 > XAVGC150 AND XAVGC150 > XAVGC200 AND XAVGC200 > XAVGC300 AND XAVGC300 > XAVGC400 AND NOT(XAVGC55.1 > XAVGC84.1 AND XAVGC84.1 > XAVGC116.1 AND XAVGC116.1 > XAVGC150.1 AND XAVGC150.1 > XAVGC200.1 AND XAVGC200.1 > XAVGC300.1 AND XAVGC300.1 > XAVGC400.1)
I get a spike on 4-3-07 using UGI
Make sure it is a percent true and that you have
"visible" (also that it is a color you can see) checked.
I don't have the averages on my chart but my guess
is 4/3/07 was the first day they were all
above each other.
Thanks
diceman
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Registered User
Joined: 12/21/2004
Posts: 902
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Apsll - regarding short-term vs long-term and your experience with LBY (good on ya!) - I find myself wavering back and forth the same way - I've made some outstanding returns on some longer term holdings - and I find a certain great psychological pleasure from it - like planting some seeds and watching them bloom into a beautiful garden a few months down the road.
But then the economist part of me takes over and starts thinking about the optimal marginal utility of every dollar I have working for me (I can be quite the merciless taskmaster). Taking, for example LBY (which, I may add, was a successful HNC/Diceman/MACDH100 candidate that moved off the decision point this week for a nice 10.4% gain in the last 5 sessions....) - there have been a number of periods since mid-February where LBY went flat. That economist guy in me says that I should have bailed on LBY whenever the Diceman indicator crossed over it's ma at the top, put that money to work somewhere else, and then re-enetered LBY again once the Diceman indicator crossed again on the bottom. Or something along that line...
Additionally, if you're playing the long-term, then you have to tolerate some much looser stops than if playing short-term. When the stock does finally reach the end of it's run, you're automatically given up a relatively bigger chunk than you otherwise would have because you're playing to preserve the long-term postion that then failed. Say you have your 75% now, and LBY fails - how much of the 75% is going to be lost before you decide that the failure isn't just a minor pullback to be ridden out but, in fact you have to bail?
Using good entry and exit indicators and tighter stops, wouldn't one have a better return over the long run by playing a long-term play but playing it as a series of short-term entries and exits and working the money elsewhere during those periods while the long-term play is slacking? You keep your positions large enough that the transaction costs aren't a factor and part of me really wants to make the argument that short-term really is the best.
Not criticizing your approach or your success - just these are the types of things that I think of when this long-term vs. short-term tension is playing out in my own head.
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Registered User
Joined: 1/28/2005
Posts: 6,049
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"Using good entry and exit indicators and tighter stops, wouldn't one have a better return over the long run by playing a long-term play but playing it as a series of short-term entries and exits and working the money elsewhere during those periods while the long-term play is slacking? You keep your positions large enough that the transaction costs aren't a factor and part of me really wants to make the argument that short-term really is the best."
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hohandy
You would think so but it is not that simple. Efficiency
is lost waiting for trade signals and slippage. Also you
need basket of strong candidates ready to fill the void
of the stock you are trying to avoid as a long-term
holding. (interesting that psychology causes us to
look for what we already have just to say we are not
"long-term")
See my analysis here of MS TSV to show how difficult
it is to "beat" buy and hold in a strong bull:
http://www.worden.com/training/default.aspx?g=posts&t=22203
Most times when you backtest and try to optimize
profits. You will see that indicators head towards
longer-term parameters.
Thanks
diceman
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Registered User
Joined: 12/21/2004
Posts: 902
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Apsll and Diceman - formula question. In the Diceman indicator formula, which is adapted here for the middle window - what should be used for the value of the "middle" indicator? I got the impression in the HNC/Diceman setup that the "middle" indicator was an average of the MAs used - or was maybe the midpoint between the highest and lowest average. (Maybe I'm putting too much emphasis on the name "middle"). I'm not sure how Apsll got the value of 200 for the middle indicator - (maybe the average of 0 and 400?) - but if it shold be the average of the 7 MAs, wouldn't it be 186? Or if the difference between the high and the low, wouldn't it be 172? Or does it matter?
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Registered User
Joined: 1/28/2005
Posts: 6,049
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With the original HNC post my intent was to use the
middle average. (based on logic rather than the idea
it was somehow superior)
With the values:
3
5
8
10
12
15
You could choose either 8 or 10.
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I suspect with the values:
55
116
150
200
300
400
You could choose either 150 or 200.
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I notice that the "proper order" filter:
XAVGC55 > XAVGC84 AND XAVGC84 > XAVGC116 AND XAVGC116 > XAVGC150 AND XAVGC150 > XAVGC200 AND XAVGC200 > XAVGC300 AND XAVGC300 > XAVGC400 AND NOT(XAVGC55.1 > XAVGC84.1 AND XAVGC84.1 > XAVGC116.1 AND XAVGC116.1 > XAVGC150.1 AND XAVGC150.1 > XAVGC200.1 AND XAVGC200.1 > XAVGC300.1 AND XAVGC300.1 > XAVGC400.1)
also has an 84 mav.
Which means that the values:
55
84
116
150
200
300
400
could be used with 150 as the "middle" average.
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I don't know if it was missed or left out on purpose.
Thanks
diceman
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Registered User
Joined: 4/18/2005
Posts: 4,090
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Hohandy:
"Additionally, if you're playing the long-term, then you have to tolerate some much looser stops than if playing short-term. When the stock does finally reach the end of it's run, you're automatically given up a relatively bigger chunk than you otherwise would have because you're playing to preserve the long-term postion that then failed. Say you have your 75% now, and LBY fails - how much of the 75% is going to be lost before you decide that the failure isn't just a minor pullback to be ridden out but, in fact you have to bail?"
this sounds right... but the fact is it is harder done than said. In my case I either miss the re-entry signal or have othere more attractive options at the time it comes. Consequently I never, or am late,getting back in. I believe that if you make a decision to hold long term than that is the plan and you need to stick to it. If you are dealing with "Long Term" then you probably arent going to fuss over a one day candle pattern. I also think it is not necessarily a good idea to buy and forget in MOST cases. We have all seen how one bad stocks can ruin a whole portfolio. So a plan is still needed ... including an exit plan. For the long term I think longer term settings on the favorite indicators a person uses are a good idea. Maybee monitor only on weekly or monthly charts. A target exit price... and put a GTC limit there.
Longer term will require analysis of Intermediate trend time periods. One engulfing black candle dosent mean anything, except that a "sale" may be coming in which to increase you position but an intermediate rounding top, tripple top, or head and shoulders pattern is significant.
Long term holding also requires IMO more fundamental leg work and is more fundamentaly based so charts will help point out the beginning of fundamental breakdowns that would need to be investigated and a judgement call made as to wether or not to continue to hold.
I'm with you ...it is hard to hold throguht sidewasye and retracements.... but you are probably better off seeing tham as a place to add to the holding. allot of my past swing trades where I made out well on a few swings would have been wildy proffitable if I had just held them ... through all the boring action. If you get your focus wrapped up in the day to day then it becomes scary also. Probably the most proffitable thing is to identify your comfort zone and trade with in that.
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Registered User
Joined: 4/18/2005
Posts: 4,090
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Trader lady:
We are having the same problems. I wondered if there wasn't an error in the formula or some problem with my settigns or scaling that prevents me from seeign all the indicators the way they should be shown as in the examples above.
I copied and pasted the formulas from here (there is no way i could type all that and get it right the first time) so .. ? ?
Might be a good question for technical suport but I have other projects that are on the front burner right now.
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