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Registered User
Joined: 11/3/2004
Posts: 2
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I'm new to technical analysis and to TC2000, and I'm wondering how I can set up the program to find rolling or channeling stocks, without having to visually scan through lots of charts. Thanks very much.
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Worden Trainer
Joined: 10/1/2004
Posts: 4,308
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Thanks for your question. There's more than one way to skin this cat. Let me think on it and get back to you with a solution or two. Check back sometime before noon tomorrow and I should have some suggestions for you.
- Doug
Teaching Online!
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Worden Trainer
Joined: 10/1/2004
Posts: 4,308
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Most people who want to find "rolling" or "channeling" stocks are really looking for stocks that tend to stay within a channel, meeting support and resistance at the bottom and top channels, respectively. You can get quite picky about what you want to see, but it's often better to keep things simple.
Let's try this approach, at least for starters. You'll be finding stocks that have been consolidating (moving somewhat sideways) for the past 6 months.
Create the following PCF in TeleChart:
((MAXH125 - MINL125) / (AVGH125 - AVGL125)) * 100
Call this new PCF "6 Month Range as a % of Average Range". Make sure you update your PCF's after you create this new one. The 125 stands for 125 trading days…or six months. If you wanted, you could replace 125 with 250 to cover a year, or replace 125 with 42 for two months, etc..
Now, create an EasyScan. Your WatchList to scan should be set to All Stocks. The only condition you need in your scan is the one you just created as a PCF: "6 Month Range as % of Average Range". On the range selector, click the "Value" button, and drag the selector from the top down to very near the bottom (you are looking for low values for this condition). Keep an eye on the number of stocks the scan is finding, and drag down until you get a manageable number. Many of the stocks you find with this scan will have been in some sort of trading range for the past six months. I promise that you won't like every stock you see. However, I think you'll find a number that have the pattern you're looking for.
You can plot envelope channels on the price chart if you'd like. I used a period of 20 with a width of 10. See if that works for you. This will serve to show you how the price tends to stay within the channel.
You said you're new to TC2000. If you think a video demonstrating what I've just described would be helpful, let me know, and I'll put one together. In the meantime, here are some links to videos we already have that may help you in this process.
Here is the link to a video demonstrating how to create a PCF:
http://www.worden.com/training/default.aspx?g=posts&t=83
Here is a link to a video demonstrating how to create an EasyScan:
http://www.worden.com/training/default.aspx?g=posts&t=23
Finally, here is a link to a video demonstrating how to plot indicators on the chart.
http://www.worden.com/training/default.aspx?g=posts&t=24
Thanks again for your question. Let us know if we can be of further help.
- Doug
Teaching Online!
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Registered User
Joined: 11/3/2004
Posts: 2
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Doug-
Thanks for the quick and thorough response. Last night I spent 3 hours "eyeballing" over 800 charts, so this will be a huge improvement. I'm looking forward to trying this when I get home.
PS - I have found the videos in the forum extremely valuable. It would also be great if, in addition to explaining how to find something technical in a chart, such as dojis, there were also a brief explanation of their technical significance, or purpose. As a novice chart reader, that would be helpful to me.
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Worden Trainer
Joined: 10/1/2004
Posts: 4,308
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I'm glad you found the information helpful. I was finding some pretty good channeling stocks when I tested things out.
Yep...the rub is always understanding the technical significance of the indicators! Technical Analysis is as much an art as anything else, and different investors assign different significance to signals as they appear on the chart. If you get in the habit of reading the Worden Notes every night, Don and Peter Worden are very good about mentioning the significance they see in particular signals. Following their comments on a regular basis can really help you develop your own style of interpretation.
There is also lots of information out on the web...and quite a few books about technical analysis. Here are two resources for you. Click on this link to go to a popular investment related website that is chock full of helpful information:
http://www.investopedia.com
Also, you can email our support staff and request that they send you Don Worden's recommended reading list. Lots of great reading material there. The address is: support@worden.com
- Doug
Teaching Online!
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Registered User
Joined: 12/21/2004
Posts: 11
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The other day I found a video on here explaining how to set up charts for recognizing rolling stocks I cant seem to find it again. . .does anyone know where it is??
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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Not sure the exact video you are talking about. All of these contain techniques for finding stocks in a channel or breaking out:
http://www.worden.com/training/default.aspx?g=posts&t=631
http://www.worden.com/training/default.aspx?g=posts&t=37
- Craig
Here to Help!
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Registered User
Joined: 12/21/2004
Posts: 11
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Craig thanks for the help . . . .as always there seems to be a wealth of information here and people willing to help you. . .I'm glad I was introduced to TC2000
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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It is really MY pleasure! I plan on making a video featuring a few techniques on how to find stocks caught in a channel. I should have it ready in the next few weeks.
- Craig
Here to Help!
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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I made a video on finding stocks bouncing within a lateral channel. I thought reader's of this thread may find in interesting:
http://www.worden.com/training/default.aspx?g=posts&t=1352
- Craig
Here to Help!
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