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Registered User
Joined: 1/24/2005
Posts: 107
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When plotting a 200 period MA on a daily chart, and a 40 period MA on a weekly chart. For example on symbol HUM fridays close I get 33.72 on the daily and 42.13 on the weekly this is way off can you explain? Both are simple MA. Thank You, Happy New Year
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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They are not using the exact same data.
A 200 bar simple moving average on a daily chart takes the last 200 daily closes and averages them together.
A 40-bar simple moving average on a weekly chart takes the last 40 closes on the 5-day bars and averages them together.
A weekly bar only displays the last close in the 5-day period.
The 200 on a daily averages every daily close
The 40 on a weekly averages every 5th close (there are 4 other closes that are not in the average which are in the 200/daily MA.)
Make sense?
- Craig
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Registered User
Joined: 1/24/2005
Posts: 107
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Power went out shortly after a submitted question.
Yes that does make sense.
What would be the best way if any to compensate for this,if any?
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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I am not sure what you want to compensate for...
Your charts are using different moving averages over different time periods. They are not going to show the same thing or give the same values.
- Craig
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Registered User
Joined: 1/24/2005
Posts: 107
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Craig what I what to know is when I'm watching the weekly charts and I get a signal that price is crossing the 40period ma. Which is the closest thing I can use to the 200period ma, its going to be a bad signal. So what is the way you would monitor weekly time frames for 200ma crosses on TC-2005?
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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You have a few options....
One, the PCFs and EasyScans are not tied to the time frame of the chart. You can scan for stocks crossing their 200 MA then look at the charts in a weekly format. Here is that PCF:
C>AVGC200 AND C1<AVGC200
Once you create the PCF you can put in the scan then look at the resulting charts in any time frame you like.
You can use this PCF to find weekly charts crossing their 40 bar MA.
C> ((C + C5+ C10+ C15+ C20+ C25+ C30+ C35+ C40+ C45+ C50+ C55+ C60+ C65+ C70+ C75+ C80+ C85+ C90+ C95+ C100+ C105+ C110+ C115+ C120+ C125+ C130+ C135+ C140+ C145+ C150+ C155+ C160+ C165+ C170+ C175+ C180+ C185+ C190+ C195)/40) AND C5< ((C5+ C10+ C15+ C20+ C25+ C30+ C35+ C40+ C45+ C50+ C55+ C60+ C65+ C70+ C75+ C80+ C85+ C90+ C95+ C100+ C105+ C110+ C115+ C120+ C125+ C130+ C135+ C140+ C145+ C150+ C155+ C160+ C165+ C170+ C175+ C180+ C185+ C190+ C195+ C200)/40)
- Craig
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Registered User
Joined: 1/24/2005
Posts: 107
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I apologize I'm very confused. My main concern is not to make a trade on false signals from what TC-2005 is telling me is happening but in reality is not. If I creat a PCF for the 40 bar ma cross and its reading the close on just the 5th day it is not going to give a correct signal so this is where I lose you . Looks like the only sure way to do this is like you said in the first part of the post. Find them on the daily and then switch to a weekly chart. Thanks
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Registered User
Joined: 1/1/2005
Posts: 2,645
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QUOTE (doji) When plotting a 200 period MA on a daily chart, and a 40 period MA on a weekly chart. For example on symbol HUM fridays close I get 33.72 on the daily and 42.13 on the weekly this is way off can you explain? Both are simple MA.
You should be skeptical of such a discrepancy.
As of 12/30/05, the readings I have for HUM are:
Daily SMA200 = 41.88
Weekly SMA40 = 42.09
The largest discrepancy from the Daily SMA200 to the Weekly SMA40 in the All Stocks List is AXJ at 3.67%. The discrepancy given by doji is 24.94%.
Please note that a "weekly" chart in TC2005 is not really a weekly chart, it is a 5-day chart. If you observe a crossing at some time in the past on a 5-day chart, it may disappear if you change the date at the right-edge.
Thanks,
Jim Murphy
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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If the weekly charts in TeleChart were based on calendar weeks it would not change that an MA would not be based on every close.
QUOTE (doji) I creat a PCF for the 40 bar ma cross and its reading the close on just the 5th day it is not going to give a correct signal
I am not sure I agree with this. A chart is a chart. When you are looking at a weekly chart you are only seeing and using:
Every 5th open and close.
The highest high and lowest low for each 5-day period.
You seem to think that there is something wrong with the 40-bar MA on the weekly because it is only using partial information. If you are LOOKING at a weekly (or 2-day or 3-day, etc) chart YOU are only using partial information. There are up to 4 highs, lows, opens and closes that you are not seeing.
It is the nature of the chart.
If you find stocks crossing their 200 bar MA on a daily, switching to a weekly chart does not change the fact that it crossed the MA on the daily.
Nothing strange about this, nothing to be skeptical of. A weekly chart is different than a three-day chart, a two-day, a monthly and a daily. It is how multi-day charts are constucted.
If TeleChart made its multi-day charts static and based on the calendar, it would not increase the amount of daily data that would be displayed.
Switching from daily to weekly should help you get a feel for the stock. One is a short-term chart and the other is a long-term chart. Don't be suprised or skeptical if the stock looks one way on the short term and another way on the long term.
Your readings on HUM do look strange (all this other stuff aside).
Check out that they are plotted correctly using this checklist:
Things to check if your moving averages don't "seem right" or "seem to match"
- Craig
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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... just checked HUM based on 12/30/05 data as well.
On a daily chart you should be getting these values:
200bar simple: 41.88
40bar simple: 47.55
On a weekly chart you should get these values:
200bar simple: 22.29
40bar simple: 42.09
Please be sure to check the link above. Something appears off in your average plots.
- Craig
Here to Help!
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Registered User
Joined: 1/24/2005
Posts: 107
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Craig...
On my daily 200bar is 41.88
On my daily 40bar is 47.55 both simple ma...
On my weekly
200bar simple 22.29
40bar simple 42.09
We both check out the same....Thank you Bustermu and Craig for looking into this I think I may have had my pointer bar not all the way to the right and got wrong data.
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Worden Trainer
Joined: 10/1/2004
Posts: 4,308
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We've all done that at one point! Glad you figured it out and that everything is working for you now.
- Doug
Teaching Online!
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Registered User
Joined: 1/24/2005
Posts: 107
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Craig is there anything that I have to do once I save my chart templates with my moving averages on them, they will automatically stay up to date correct. And how about when you download to your server any time you make changes you want to download again so you don't get the wrong stuff back if you needed to,is that correct. Thanks
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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You can do a back-up to the servers at any time you like.
The indicators on the chart are always calculated on the fly based on the most recent data in the program. All indicators on the chart are always updated with the program - there is nothing you need to do.
- Craig
Here to Help!
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Registered User
Joined: 1/24/2005
Posts: 107
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Thank you. If you don't mind a few days down the road I will just double check on the moving averages again just to comfort my own mind.
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Worden Trainer
Joined: 10/1/2004
Posts: 18,819
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Sounds like a plan. You know where to find me!
- Craig
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