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Strategies & Market Trends : Stochastics -- Ignore unavailable to you. Want to Upgrade?

To: Playin my Cards who wrote (456)	4/4/1998 11:38:00 AM
From: Wayners	Respond to of 927

There's nothing wrong with using longer term stochastics. It depends a lot on the individual's timeframe and the behavior of the stock as well. The lower the stock's volatility and uptrending characteristics, I believe the longer term stochastics are superior. I just look for bigger hooks in stochastics to get a sell signal for those types of stocks, but sometimes that isn't even good enough. The INTC run from $50 to $200 comes to mind. If chart mutual funds, a longer term stochastic is needed for example. I have difficulty using intraday stochastics because I lack the software and data service to support it. I can do a cut and past from quote.com into excel do some edits and import it into WoW manually on an issue by issue basis. I think its of really good value to do it and watch it intraday-but its a pain and I only do it for positions I am about to enter or exit. You can get signals before waiting for the closing data. What I'd do is use the intraday chart as a blow up of the daily charts. I'd still be using the 5 day stochastic and 12 day moving average, only I'd be using say the 60 minute tick charts and the 12 day moving average on that chart would be 78 60 minute ticks and the 5 day stochastic would be something like 30 60 minute ticks. When you do this, it doesn't look as smooth anymore, but the same buy/sell rules apply. You can see crossovers sooner than you would by waiting for the daily close data. I really need better software and data service. If I ever get to the point where I can quit engineering and do this full time I will be investing more in my system. I still look at support and resistance levels like daily highs and lows. When I get close to a sell signal on stochastics and I see price at a resistance level, I don't wait for the sell signal on stochastics--I go ahead and sell it. Same thing on support levels and stochastic buy signals. On IQC, it doesn't move a lot price wise in a single day. Doesn't meet my requirements in that regard. Its doing the countrertrend rally on high volatility (relative to its own historical norm). I think its going to go higher here short term. Its not peaked out on stochastics and I'd expect the volatility to drop a lot further at the top. On LU, its been on a real good tear upwards. Splendid uptrend that is really nice to buy into on dips and lulls. Most recent signal I got was a buy signal on 1 Apr--no fooling. While not topped out short term I think its pretty close. I don't think its going to drop or anything right away, I just don't think the upward potential over the next few days to a week is all that high. After than I'm looking for a short term top for the next buying opportunity. When it does top, the volatility will be high enough to get some countertrend drop. I don't think it will be real drastic though. On UTX, its also in a nice uptrend. Last signal I got was a buy signal on 1 Apr. I think its too close to a short term top to buy in right now, but the next buy signal should be another good one. Volatility is actually quite low on this one, so I don't expect any price drops on the next sell signal.