Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Classic TA Workplace -- Ignore unavailable to you. Want to Upgrade?

To: bcrafty who wrote (53289)	9/14/2002 6:52:10 PM
From: AllansAlias	Read Replies (1) \| Respond to of 209892

Can either of you tell what good MACD is here? My experience tells me it's only useful in a trend.

To: bcrafty who wrote (53289)	9/15/2002 11:36:41 AM
From: John Madarasz	Read Replies (2) \| Respond to of 209892

sometimes the 8-17-9... and a lot of experimentation still...but i really don't rely on it much, which I elaborated on in my latest message to Al. More just trying to raise a little more awareness, and introduce some challenging thought. $ Info here: There was a significant development in the status of the December U.S. Dollar Index (DX2Z) in Friday's trading session. The dollar was in a longer-term downtrend, and needed to "close" above 108.37, in order to neutralize that negativity. The dollar closed at 108.60 on Friday, so it's now in a neutral zone. The next level of resistance for the dollar is the 8/22 high of 109.04, followed by major resistance at its 8/06 high of 109.80. The dollar will switch from neutral to bullish for the longer-term now if it can "close" above 109.80. Near-term support can be found at 107.45, followed by major support at 106.05. If the dollar continues to move higher on Monday morning, especially if it gets above 109.04, it will likely give a boost to the stock market. The synchronicity between the dollar and the stock market is well documented, and they've been tracking each other quite closely recently USD trading at 109.75 as of now quotes.ino.com Older chart showing the Inv H/S back in play boomspeed.com

To: bcrafty who wrote (53289)	9/16/2002 2:22:40 AM
From: augieboo	Read Replies (1) \| Respond to of 209892

bcrafty, just a few thoughts on the MACD issue: Alan Farley, (author of The Master Swing Trader), recommends a variety of combinations -- both of MACD as well as of other indicators -- depending on the holding period of the trade, (which also determines the periodicity of the charts to use). Here's a thumbnail, in case anybody is interested. 1. Daily, weekly, and monthly charts: 8-17-9 MACD for buy signals 12-26-9 MACD for sell signals 20 day Bollinger Bands 14 day smoothed RSI (or, if smoothed RSI not available, 14-7-3 full stochastic) Volume w/60 day MA On Balance Volume 2. 60 minute charts 8-17-9 MACD for buy signals 12-26-9 MACD for sell signals (both with histogram) 13-2 bollinger bands 8 & 5 simple moving averages 5-3-3 stochastic 3. 5 minute charts (I KNOW -- WIGGLES!) 8-13-8 MACD histogram (I think histogram only) 13-2 bar BB 8&5 SMA 5-3-3 Stochastic 4. For day trades of 1-3 hours 6-17-9 MACD on 60 min chart 5-3-3 Stochastic on five minute chart 8-2 BB on one minute chart A couple tips passed on to me by Eddieww, (another SI poster). 1. For day trades, he uses 5 bar Exponential and 8 bar Simple Moving Averages together -- swears they give they best crossover signal. (This was discovered on an old SI thread the name of which I cannot recall at the moment.) 2. He also likes the ULT, (ultimate oscillator), in place of the more commonly used RSi. Says it often leads price by multiple bars on intraday charts. (He uses the standard 7-14-28 settings.) A couple things I have played with. 1. I've started using the PPO, (percentage price oscillator), in place of the MACD. They both do much the same thing, and look very much alike, as this chart shows: stockcharts.com The difference lies in how they are calculated. The MACD is calculated by subtracting the longer EMA from the shorter, and then using a third EMA as a trigger line. (For the standard 12-26-9, you would subtract the 26 EMA from the 12 EMA, then use the 9 EMA as the trigger.) The point is that the main line of the MACD plots the absolute difference between the two EMAs. stockcharts.com The PPO, on the other hand, is calculated "by subtracting the longer moving average from the shorter moving average and then dividing the result by the shorter moving average." Thus, the main line of the PPO plots "the difference between the two moving averages as a percentage of the shorter moving average." stockcharts.com So what, you ask? So, it means that you can compare changes in PPO levels from one issue to another, which you cannot do with the MACD. For example, you could look at the 12-26-9 PPO of BKX and compare its movement to the 12-26-9 PPO of the SPX, to see if one is leading the other, are they diverging, etc. In addition, you can look at the PPO on a given issue from one time period, (for example, the top of the bubble), and compare it to the PPO from another time period, (for example Friday's close), and they will be comparable, even if the issue has lost 95% of its value. By way of contrast, comparing the MACD of, say, QCOM at the height of the bubble vs the MACD of QCOM today would be meaningless. HTH, augie