Set the Controls For The Heart of the SUN Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Set the Controls For The Heart of the SUN

IQ 1.925

+0.8%

3:59 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Claud B who wrote (540)	7/18/1997 7:14:00 PM
From: Mr.Creosote	of 1156

Claud, Doug, ST and Co., I finally have a working version of the sequential with most of its "qualifiers" and was able to carry some tests. It is beginning to become clear to me that the so called "low-risk" and "high-risk" zones that the sequential identifies do not carry as much weight in a strongly trending market (one that has been trending for years). I tried it on the S&P500 (as well as MSFT, DELL, and other strongly trending stocks) and from its last 5 signals all of which were sells only the last one was right on ("13" on 2/18/97). It is of course difficult to test the sequential system for performance without entry and exit components. I know DeMark has presented some ideas along these lines in his book but so far I find them not as effective as I would like. That's not to say that the sequential has no merit. I think it does but it needs additional work beyond Tom's writings (in first book only, can't wait to see the second). The area I find most wanting to improve is the ENTRY once a "13" is detected. The entry mechanism will need to be modified/redesigned to further eliminate false signals. This may sound a little funny since a qualified "13" does not occur often as it is and a more complex entry will result in even fewer trades per unit time but I believe it must be done to increase profitable trades. In my opinion the "13" should have a well defined distance of influence beyond which the entry is unwarranted (i.e., if entry does not occur within 13 days from the occurance of the "13" the sequential is disqualified). The idea of entering after observing an open-close pair in the direction of the trade didn't work out well in the limited tests that I did. One could theorize that the specific mechanism for entry should be based on another indicator but what would that be and how is it justified? More later ... JS

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next