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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: j g cordes who wrote (16131)	5/20/1998 2:13:00 AM
From: Lachesis Atropos	Read Replies (1) \| Respond to of 68411

Data de Sade. My skepticism stems from inexperience. I haven't been looking at market data long enough to see patterns as you would. Like calculus the more one practices and applies it the better one can recognize such patterns as rational forms of integrals. I did not see a correlation between sectors on a former analysis so I was not expecting to see one; however, come to think of it I did not do through study. The approach I was taking was computationally intensive -a few weeks between runs on data. Now I have a different method that is computationally friendly to get me further along. Something similar to the sector rotation concept was my first project, before I started looking at other TA concepts. Now seems to be a good time to take it further. My assumption was that one should be able to "see" money flowing in the market between stocks, I just did not have a good way to expose it. I torture data until it speaks-Data de Sade. "A question I'm curious about is the absolute value of inflow and outflow of money relative to price." I am not sure but conventional stock data--open, close, high, low, volume--is insufficient to show inflows of money. If you have a way to measure inflows of money let know! I am preparing data for another analysis. I want roll up the stocks by rotation to show which one follows the other. Then look for patterns on sector rotations, sector and subsector rotations, and just at stock rotations. There are a few ways to slice and dice the data. The analysis will us how sectors arrange themselves overtime and how sector/subsectors arrange themselves overtime and how stocks within a sector arrange themselves overtime- slice n dice, slice n dice... Start at macro level and keep progressing down to a more micro level. Sound advice: "Last, I've found a site which posts 45 second updates of 15 minute volume/price accelerations. Interesting, though 15 minutes of activity does not a good trade make" Though some like Barbara J Payne do well in fast moving stocks. Lachesis

To: j g cordes who wrote (16131)	6/4/1998 6:36:00 PM
From: Lachesis Atropos	Read Replies (1) \| Respond to of 68411

Jim "Lachesis, I'd like to go back to something we previously discussed" "...Uncanny, but their seems to be a correlation of trends by sector; however, I am still skeptical." By this, did you think there wouldn't be? My comment was made when I was looking at the Internet Providers sector. When I looked at them they were very similar. However, the TA you directed me to on www.market.watch noted a divergence in sectors and stated that a market with such behavior is not healthily. They also made the observation of a head and shoulders formation in the Russell 2000. So, my inconclusive conclusion is that in a healthy market, stocks by sectors may have a strong correlation but that is a hard mathematical proof. What I did find is stronger correlation to price classes, than to sectors or indexes. This observation is loosely confirmed by comments on SI threads. For example, the momentum traders I follow prefer stocks in certain price ranges. Further more, Motley Fool, a currently widely read investment book, also confirms this observation when they encourage investing in 5-25 dollar stocks with a low capitalization--their reasoning is that these stocks are the most likely to be profitable on long term buy and hold. I believe trader's trades are influenced by the price of a stock rather that by what sector it is in. A further observation is that of the split phenomena which is when stocks drop into a different price class. Any thoughts?