Using OmniTrader
I've only had the program for a few weeks myself, so I'm hardly an expert, but I can say it has already changed my trading behavior.
One of the wisest things my broker ever told me when I started investing seriously is The opportunity stream is infinite. Cash is not. Like most profound statements, it took me a long time to really understand it.
OT's major benefit, and the reason I'm sold on it, is that it helps you see the opportunity stream.
Here's how I use it. I have a profile named Master which contains every stock I might ever conceivably want to trade. It currently consists of over 700 issues ranging from the bluest of blue chips to off-the-wall story penny stocks. Every week I probably run across a half dozen or so stock ideas (I admit it, I'm a stock junkie) and never knew what to do with them. Now I just toss them onto the list and wait for them to come to me.
Every night I download my end of day data and then let OT grind away sifting through my master list (I'm using the STOCKS, Medium Term Aggressive default trading model, mainly because I haven't really figured out the nuances of OT's trading models or how I might want to tweak them). After a couple of hours (which should be at least halved once I get the 32-bit version working) I typically find it has culled 10 or fewer buy signal candidates. There are typically at least as many short signals flagged, but at this point I'm not shorting anything.
For each buy signal I look at the focus list to get a quick assessment of the strength of the signal. My focus list displays the Backtest hit rate, Advisor rating, Backtest APR, and Closing price. I find the closing price helpful in letting me decide immediately if this stock is in a price range where I'm comfortable trading it (e.g., based on my current positions, I may be looking for a $20 trading opportunity). I then use OT to plot the charts and examine the signals that led to the recommendation in more detail. This is one of the things I really like about OT. It is not a black box that just hands out take-it-or-leave-it signals from some mysterious source. Each indicator is visible along with its track record for that security. I also cross-check the chart with SuperCharts to give me a few different perspectives. As I stated previously, OT's strength is not charting and I have confidence in many of the indicators that I've used in SuperCharts for some time, but by themselves these indicators are useless if you're looking at the wrong chart! OT tells me which charts I should be looking at today.
Assuming the OT signals look reasonable and I like what I see in SuperCharts, I then check the recent news on the stock (via Yahoo) as well as its threads here on SI. If it's a company I'm already very familiar with I'll probably trade it the next day. If it's one I'm not familiar with (one of those off-the-wall stories that may be ripe for a pop) then I'll do some more digging. For example, one of the off-the-wall stocks that popped up last night is NETZ. And one of the reasons I added to my QGLY position yesterday was that OT was flashing "buy" on it a few days ago.
For those signals I pass on, I still enjoy learning why OT generated a signal for them or even what they say about the sectors they are in. Though for sector analysis I'm using a different profile (named, originally, Sectors) into which I've placed the 120-odd sector indices that my Dial/Data subscription gives me but which heretofore I hadn't any way to analyze. They get looked at every Saturday and help spot market-wide sector rotations. For example, last Saturday I noticed that the computer storage sector appears to be (finally)turning up, so I'll be especially inclined to pay extra heed to any signals those stocks generate over the next few weeks.
As to when I'll close out a trade, I'll do so when I get a reversing signal or if a better opportunity comes along.
Anyway, that's how I'm using OT so far. Hope that helps. |
