Mark---off topic---
I use KST as a long term directional indicator not
just as a momentum gauge as described by Pring.
A zero line crossover is usually too late to be of much value. However, in general upward markets tend to stay above the
zero line and downward markets the opposite. In extremely
oversold or overbought markets one can often tell
by the distance above or below the zero line whether a rally or
decline will continue. I have found is extremely valuable. Look at
the Lt KST for the Dow, Amex,Transports,Nasdaq,etc-- everyone
now is screaming bear market, but even in their present oversold
condition, most of these indexes are still in positive
territory, implying higher prices to come. Each time in the
last three years a selloff occurred, the same pattern and
results. In the opposite direction, the KST would tell the
gold bugs to hold off and the Japanese that the NIKKEI rally, though
impressive will fail.
Since KST is such a lagging indicator at market turns, I
utilize intermediate and shorter term oscillators
with varying time frames to hone in on critical turns
or to anticipate market tops or bottoms.
From a momentum standpoint, significantly lower highs
or higher lows tend to anticipate significant directional
changes way in advance so that preparations can
be made. Most rapid price appreciation or decline tends to be
reflected in rapid changes in KST's slope.
Everytime I second guess what is being shown by the
LT KST, even in thinly traded stocks, it is right,
and I am wrong.
With all the esoteric TA popularized on SI, where
funny squiggles, squares, crossovers (real and imagined)
are supposed to carry great weight, I still can not
understand why KST remains so undiscovered! I can't
evaluate any tradable entity without it.
CT |
