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Strategies & Market Trends : Technical Analysis - Beginners -- Ignore unavailable to you. Want to Upgrade?

To: Smooth Drive who wrote (10974)	8/18/2000 9:39:38 AM
From: TechTrader42	Read Replies (1) \| Respond to of 12039

You could experiment with shorter time frames for MACD, which have their uses in this volatile market -- 5/14/6, for example. Lately, shorter periods have been testing better than 8/17/9 for me in intraday and daily intervals. But some prefer longer periods, such as 12/26/9. 13/34/89 can work in intraday intervals, too. The best trades are always when several MACD's are all lined up giving the same signal -- for example, when 5/14/6 and 13/34/89 are both reversing at the same time. 13/34/89 is based on Fib numbers, as you know, and I suspect there are many periods that are close that would work just as well. I'm not inclined to think there's anything necessarily magical about Fib numbers, but some swear by 'em. As for the Bollinger bands, I prefer the traditional period of 20. They seem to work well for buying and shorting when the price penetrates them (AMAT is a recent example, at the low around 8/03/00), but there are occasionally breakouts when price goes through them. (Reminds me of a comment on CNBC this morning about "The Brain" being able to hold two contradictory thoughts in his mind.) Oftentimes, the middle band, which is the 20 SMA, is a strong support or resistance line. Besides the 200 and 50-day simple moving averages, which I have in most charts, I like the 28-day SMA. Look for breakouts above and below it for buy and sell signals. As for prices going where they've been, that's simply the basic idea behind support and resistance. For example, look at HD's resistance near 58.5 on 7/11, 7/21 and 8/8. You can set targets based on the previous highs and lows. You can build systems on this -- simple ones such as Bollinger bands, or complex ones such as Murrey Math, based on the range and all points between.