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Strategies & Market Trends : Tom Demark Indicators

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To: Joel Brussell who wrote (81)4/16/1997 9:57:00 PM
From: Tom Trader   of 110
 
Joel, thanks for suggesting ways to use the sequential in combination with other indicators.

All of the methods and indicators that you suggested seem very logical and well thought-out. I particularly like the approach of waiting for the ADX to turn and also to look for some level of compression in prices before one takes a position. In a sense it does what Demark suggests in terms of looking ofr the intersection and some level of price stability before taking a position. Have you looked at using the weekly sequential as a filter and then the daily charts for determining entry based on some of the very same indicators that you mentioned.

As you know, I favor the use of mechanical systems--the lazy person's approach. It has the enormous advantage that it takes away the subjective/emotional component in trading. I use a completely mechanical system for trading futures. However, I have not been able to develop a really good system for trading stocks--but I never stop trying:)

The sequential approach has the promise of a good filter for trading opportunities. I now need to find an effective "trigger" mechanism for entering the trade and back test it with some historical data. I'll share with you thoughts that I develop in this regard after I get going on this. Now that I have filed my return, it should be possible for me to put some time into this:)

Take care and thanks again for your input.
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