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Strategies & Market Trends : Dr Alexander Elder's Triple Screen trading methodology -- Ignore unavailable to you. Want to Upgrade?

To: Bob Jagow who wrote (5)	2/4/1999 8:57:00 AM
From: unixgeek	Respond to of 6

Someone else mentioned "the trailing stop buy-in point moving down with the stockuntil it hits or expires". I assumed it dies if the next day's low isn't higher [and still negative]; could you clarify the logic, especially 'expires'? I'll talk to the long side, though the short side is the same, albeit reversed. I'm no Elder scholar (no pun intended), but my take on his _philosophy_ of the scans is this; the first scan is to narrow down the universe of stocks into a set that looks ready to turn up. The second scan is simply bottom feeding, since the first scan usually generates quite a large number of signals. Scan 2 is to just to narrow it down even more. Scan 1 - "these are the ones" scan 2 - "of those, these are the highest percentage hits" Scan 3 isn't really a scan, it's an entry point, and that being a trailing buy stop. Scan 2 got us a list of maybe 1 or 2 stocks to try and get into, BUT, the MACD of scan one really is charting where deceleration of price has decreased, so it still could be going down, so we want to buy on the high, on the assumption that if it hits that, its downward trend is over. I trail the buy stop for the remainder of the week since if it DOESN'T hit, it's probably still going down (or has flattened). In either case though, it's still in my universe of things to look at. More simply put, it's just a turtle-ish/donchian entry point. I expire it at the end of the week if not hit since I will now re-generate the scan 1 candidates. Chances are this week's continued lowering of the buy (and thus its price) has taken it out of contention based on the weekly MACD. But if not, it goes back into the pot the next week. (I do need to see the oscillator signal hit again though; that may be inconsistent with the theory, but due to the batch nature of my nightly routine, I just reset on Sunday. There are so many trades out there that I don't feel at all bad if I miss one or two due to that.)