Hello Les,
Thank you.
Les, (and thread) for a bit of Sunday group think<g> I would appreciate thoughts on how to bastardize Doug Fabian's two basic indicators (trend based) on being in or out of the market.
Fabian was interviewed in this months TA&SC. His two primary indicators are 1) "Propritary, but there's no complicated black box behind it. It's a composite of five widely held stock funds that gives us a picture of the trend of the overall stock market; and 2) "We use the Dow Jones Composite Index as a confirming Indicator. When both of these indicators are above their 39 week moving average, we have a buy signal en effect, and you should be fully invested. When they are below there 30-week averages, we move to 100% money market funds. We don't ask why, discuss it, or wait for tomorrow's market action. We follow our plan". He's goes on to describe some recent entries, exits and return.
So, for fun and education. What would be five indexes that would "Give us a picture of the trend of the overall stock market"? Perhaps the S&P 500, Value Line, NDX, ??? And, what would be a logical way to crate a composite of these five indexes using a 200 day MA?
You go first Les.<VBG>.
Take care,
Eric |
