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Strategies & Market Trends : TA-Quotes Plus -- Ignore unavailable to you. Want to Upgrade?

To: Craig DeHaan who wrote (2967)	1/11/1998 1:05:00 PM
From: Jeff Grover	Read Replies (1) \| Respond to of 11149

Craig, You asked "...am I correct in assuming that we're looking for a break in the trading bands for two consecutive days before buy and sell signals or is one day all that's needed?" Chande's book offers many ways to calculate and trade on his VIDYA indicator. The scan I posted is somewhat of a variation on his theme. The Buy (Sell) messages are triggered if three consecutive closes are above (below) the VIDYA as calculated for that day. I do not believe I posted any variant that used bands (although I have do have one). Were I to follow Chande's trading suggestions explicitly I would use my original scan posting and modify the if-print statements as follows: if close(0) >= vidya and close(-1) >= vidya and then // just guessing at the price vs tick ratios here if close(0) > 25.0 then tick := .125; else if close(0) > 10.0 then tick := .0625; else if close(0) > 5.0 then tick := .03125; else tick := .0015625; endif; endif; endif; println Symbol:-6,"BUY , at: ":-5,High(0)+tick:7:3," VIDYA: ":-5,vidya:7:3; endif; My inspiration for the initial two scans and this explicit (I believe) interpretation come form Chapter 8 of the Chande book. Specifically the section on "A CMO-Driven VIDYA Trading System" that states: 1. The rule to open long positions. If the closes of today and yesterday are both above the VIDYA of today, then buy tomorrow on a buy stop order. Place the order 1 tick above today's high. 2. The rule to short positions. If the close of today and the close of yesterday are both below the VIDYA of today, ll tomorrow on a sell stop order. Place the order 1 tick below today's low. ---- As there are many ways to interpret, code, and trade this indicator I'm not sure that any one scan will satisfy everyone's needs. And as has been stated over and over again by those on this threat much wiser then I "you need to develop a system that fits YOUR mindset". I am open to producing a series of VIDYA scans covering many of these variations but do not have the time to do so all in one fell swoop. I'll try to do them a little at a time, post them on my web site, and maybe sweet talk Brooke into adding a pointer over to it. Anyone whom is interested should e-mail me specific thoughts on how you'd like to use VIDYA and I'll try to incorporate them. Also, anyone in interested in these matters should also look at the Jan'98 TAS&C article on page 93, "Breaking out of Channels" by Gerald Marisch.

To: Craig DeHaan who wrote (2967)	1/11/1998 2:20:00 PM
From: TechTrader42	Read Replies (1) \| Respond to of 11149

Richard Estes could do a much better job explaining Vidya to you. I've endeavored to plot it in WOW, with the use of Excel, but I haven't explored using it in trading systems. Jeff translates the system into: if close(0) >= vidya and close(-1) >= vidyay and close(-2) < vidyab then That would appear to be: Buy if the most recent close is greater than or equal to the most recent Vidya. and the previous close is greater than or equal to the previous Vidya, and the close before that (-2) is less than Vidya (-2) before that. Close(0) is yesterday, if you downloaded your data yesterday, so Close(-2) would be three days ago. Same for Vidya (Vidyab is essentially Vidya(-2), but Vidya is recursive, so you need to use Jeff's formula for Vidyab). To get the bands in Metastock, you can use a formula that multiplies Vidya times 1.01 for the upper band and .99 for the lower band. You could try a trading system with the bands, too. Chande's system, in "The New Technical Trader," is to buy tomorrow "if the close of today and yesterday are both above the Vidya of today." Sell "if the close of yesterday and today are both below the Vidya of today." The article in TASC suggested a system with the bands, though. Try it like this: Buy if the close of today and yesterday are both above the upper band. Sell if they're both below the lower band. But as I say, I haven't tested any of these. Richard probably has some better ideas, on systems and the width of the bands (and the usefulness of the bands). I've got to get Metastock -- no doubt about it. Brooke