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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: Thomas C (Hijacked) who wrote (33628)	11/13/1998 12:34:00 AM
From: Moominoid	Read Replies (1) \| Respond to of 94695

I believe TA can be quite useful over longer time frames as well. If for example one followed the MACD in the monthly time frame, it would have signalled you out at the peak of 1929 and forced you to get back in right at the BOTTOM in 1933! This might indicate a four year cycle that might still be current. If you look at the spectrum of the first difference of the log of a stock price index (daily data) you'll see plenty of cycles in shorter timeframes. I personally haven't looked at these longer time frames. In other words, large segments of the stock price index are a simple random walk but the shocks aren't pure white noise - they do have cycles in them. So that's why I'm skeptical of large scale "patterns" but can see that there might be cycles. On shorter time scales the series doesn't necessarily look like a random walk. But perhaps there is some fractal like behavior where weekly or monthly data has similar properties to daily data. I've only recently started to look at that and rather haphazardly so I'm just starting to learn. David