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Strategies & Market Trends : Technical Analysis- Indicators & Systems

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To: Paul Beattie who wrote (1480)6/12/1997 10:37:00 PM
From: Bill Sandusky   of 3325
 
Paul,

Think of the stddev line as the "target" price for any point in time. Now look at Plot1. When Plot1 is "above" the sd line things are bullish. When Plot1 is "below" the sd line price action is likely to be bearish. Doesn't work 100% of the time but is pretty close. Another way to look at the relationship between these two plots is to think of Plot1 as a 5-day ma and the sd a 13-day ma (slower of the two). When the 5-dma (Plot1) is greater than the 13-dma (sd) things are generally bullish. The opposite is true when the 5-dma is below the 13-dma. Hope this helps. Will talk about this as time permits in Jersey.

Bill
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