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Strategies & Market Trends : Bonds, Currencies, Commodities and Index Futures

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To: Patrick Slevin who wrote (12225)	5/21/2013 9:17:52 AM
From: Chip McVickar	1 Recommendation Read Replies (1) of 12410

Hello Patrick... AAPL is an interesting chart... 442 is a primary Fib pivot point on the daily chart I put a 34 EXP moving average overlay on balance volume and its in neutral right now. btw... my work says the indexs are now in a window for a modest pull back... 1.618 fib extensions have been established too yesterdays daily SnP cash chart produced what I call a "Cherry Bomb" candle stick... farely reliable sell signal... 1672.84 may well be a high for a while... Chandelier is a stop-loss tool also good as a trend following tool Chandelier Exit The Chandelier Exit sets a trailing stop-loss based on the Average True Range (ATR). The indicator is designed to keep traders in a trend and prevent an early exit as long as the trend extends. Typically, the Chandelier Exit will be above prices during a downtrend and below prices during an uptrend. Calculation The Chandelier Exit formula consists of three parts: a period high or period low, the Average True Range (ATR) and a multiplier. Using the default setting of 22-periods on a daily chart, the Chandelier exit will look for the highest high or lowest low of the last 22 days. Note that there are 22 trading days in a month. This parameter (22) will also be used to calculate the Average True Range. Chandelier Exit (long) = 22-day High - ATR(22) x 3 Chandelier Exit (short) = 22-day Low + ATR(22) x 3 As shown with the formulas above, there is a Chandelier exit for long positions and one for short positions. Interpretation The Chandelier Exit is basically a volatility-based system that identifies outsized price movements. Le Beau defined volatility by using the Average True Range, which was developed by Welles Wilder, creator of RSI and the Average Directional Index. ATR uses the prior close, current high and current low to determine the "True Range" for a given period. After some smoothing, the daily True Range values evolve into the Average True Range for a given period of time. stockcharts.com

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