[ CKR: Updated with System Chart ]
Glen,
I plotted a simple, short-term trading system on CKR that's based on Momentum Theory, and filtered it with Lane's Stochastic to make the entries take place at truly overbought/oversold regions. The entries were timed and based on the theory that a stock price will reverse once a peak or trough in the stock's momentum has been reached.
Given the volatile nature of the company's chart, I plotted such a trading system on CKR, and found rather impressive results. While it had an uncanny ability to pick many a price peak and trough, the system was met with most success when a long position was opened while the intermediate term UPTREND remained intact. Once the uptrend was broken, however, the reliablity and profitability of the system became immediately less effective.
Even though the concepts of the system appear sound, even it can't continually win in the face of a declining trend (assuming a long position is desired). This little exercise only adds to the notion that one should trade with the trend.
By the way, that system I mentioned just opened a long position at the close of yesterday's trading. But remember, it has opened such a position in the face of a declining market, so I will place less reliability on the recent signals being generated.
Here's a look at the trading signals generated by my system (in the meantime, keep an eye on the System Equity--that's the system's profitability. Within two years, you would have had a return of over 700%):
members.aol.com
Good luck.
Rainier |
