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Strategies & Market Trends : The 56 Point TA; Charts With an Attitude -- Ignore unavailable to you. Want to Upgrade?

To: bdog who wrote (33823)	2/6/2000 2:11:00 PM
From: Warthog	Read Replies (1) \| Respond to of 79230

bdog, I have been working on some modifications to the CrossHopper Scan (not complete yet), I have noticed that if one constructs the following: Curve 1:= LinearReg(rsi(3),8); Curve 2:= mov(Curve1,13,e); when curve1 is above curve2 then a bullish situation is occuring. For CAIR nov 15th to dec 27th, a Bearish situation was in place. On dec 30th, jan 6th and Jan 13th; crossHopper type hits occurred. To a novice, it looks like the 13th might have also been a TC point. feedback welcomed here also. wart

To: bdog who wrote (33823)	2/6/2000 6:19:00 PM
From: Michael Watkins	Read Replies (2) \| Respond to of 79230

bdog - thanks for the background info - I was just trying to get a sense for how you were managing the trade. I stopped system trading and only use QP scans now to identify retracements and tests of tops/bottoms -- all for further stalking -- but it sounds like some of what we would do is similar. Assuming that I was stalking CAIR prior to the big white candle, its possible I would have been faked out twice before -- 11/16 and 11/19, losing on one and b/e on the other. I say possible because its unlikely I would have taken the first trade (I would have been stopped in much like you do - with a buy stop limit 1/4 above the inside bar the day before.) No, I'm reasonably confident I'd have drawn my 1-2-3 lines ana trend line through the lows of 11/1 and 11/9 - and seen the move back up to that trendline as a normal occurance and not to be traded EOD. I use a 20 day EMA and would have been looking for price to move down to it and near that point I'd be trailing down bars with a buy stop limit above. So the entry is pretty mechanical, the exit unfortunately is not. Ideally my stop loss os going to be the low of the bar that takes me into the trade - 1/4 or 1/4. Certainly intraday trading this is a mandatory for me. But I find with position trades it makes sense to seek nearby support as well, and also to use judgement based on the character of the subsequent couple of days. I'm always looking to be in the money within 1 or 2 bars so I think I'd have closed the trade based on lack of movement if nothing else. The next day 11/22 would not have stopped me out but come very close. I think I'd have just used judgement the next day and not seeing anything remarkably bullish there, exited. If for some reason I stayed in and endured the next few days including that gap down and reversal -- but still no follow through the subsequent days... well for sure its time to bail in my opinion. Going back to that trend line we drew up above, 11/12 low is my reference point and I draw a line there immediately as the first swing low after a high/trendline break. Anything that dances around the swing low line too long is dangerous in my opinion. Same thing with tests of tops too for that matter... I don't think that I'd have revisited it after it died. Maybe, just maybe if I was paying attention and noted 1/06 dip I'd have followed it and tried entering on a retracement as long as it didn't violate that low. I only will go long with a buy stop above a down bar (not refering to closing price - a lower high, lower low than the previous bar, regardless of closing price being up or down) -- so I think entries are safer because to some degree the market is proving us by taking us in the trade, and if we are wrong we aren't buying falling knives. Thats also the rationale behind the stop placement - as if we are bagging a retracement, it should not go to that low. If it does, the retracement is faulty and not to be trusted... yet. I'm a terrible one for patience (you guys are amazing at that!) so I know in my heart I'd have missed the great move unless someone pointed it out to me again. My long scans are more or less limited now to detecting retracements and 1/06 would not have showed up due to its position under several key MA's. I've been rambling so long and with a couple of hour long interuptions I can't recall if I got my point across so I'll just press Submit now and take me out of my misery! Thanks for sharing! Mike