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Strategies & Market Trends : TA Science Projects & Experimental Indicators -- Ignore unavailable to you. Want to Upgrade?

To: Sal D who wrote (214)	6/29/1998 2:57:00 PM
From: ftth	Read Replies (2) \| Respond to of 237

Hi Joe, thanks for the thoughts on stochastics. I didn't mean to imply they are of no use to anyone; in fact I've toyed with some derivatives of stochastics because I do see the basic concept of what it's measuring to have potential value. I'm sure there's probably a way to incorporate most any indicator into some well-matched system where it gives good results.But, not every indicator can be made to work effectively in every conceivable method or system. Some stocks just don't correlate well with certain types of measurements and/or fixed, arbitrary indicator periods. In other words, within a given indicator-based system, how much of the system performance can be attributed to indicator X, and what happens to system performance if indicator X is removed. For stochastics, I just found they didn't really hurt or help performance, but I never tried the specific settings you mentioned. I guess you could say I've given up on the basic form of stochastics as being compatible with the way I trade, and believe me, I did spend a fair amount of time on it. You have to cut it loose at some point though, and move on, because the possibilities and variations are almost limitless. I'm happy to hear you're able to use stochastics successfully, but there are MANY other pieces to your system no doubt, and some are probably based on your experience and judgement, which no one can duplicate exactly (unless it's 100% mechanical). For example, the scan you run probably produces far more hits than you can commit capital to. Any variation in WHICH subset you commit capital to, and in what proportion, as well as the exit criteria, will give different results. That variation alone can turn a system that's immensely profitable for one person into a system that's immensely painful for another person. I welcome your comments though; perhaps you could discuss the confirming indicators you use, typical holding time, as well as what indicators you ruled out. dh