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When the signal exceeds 25% for a single day, it is an indication that the present trend will
be continued.
Another interesting calculation is the sum of continuation signals the last3 days. Sometimes
it is above 50% . It is a strong confirmation for a continuation of the existing trend.
>From the trading point of view, when you receive a strong signal it is better to wait some more
days before the probable change of the trend.
For ^NDX group, the last 28 months, the strong signals were always correct.
Notice in the att. gif the last DOWNcontinuation signal.
On Apr 22 it is 29%, the highest since Jan 2000 [!!!]
and the last 3 days was 45% and on Apr 23 42%.
With this indication, I would not suggest any "Buy". It would be better to wait and watch the
continuation of the downtrend. Besides that, the Market direction and the Trending /Trading
indicators were mostly bearish.
>From Apr 22 to 23 [point X], the ~macdbear crossed the descending ~macdbull.
As a bearish indication, it was more than clear.
At least you could wait until the bears turn back to lower values !!
The next days verified all the above indications.
The Market broke a significant support and no apparent new support is predictable. Any new level
should be tested first, before premature action is taken .
The oscillating nature of Relative Slope makes me hope that the same will be repeated in the future.
Amibroker functions are so powerful and may help us to avoid crucial mistakes. After that, we can make
some sweet profits. [Tomasz will be more than happy with this last detail...]
References
http://groups.yahoo.com/group/amibroker/message/3588, Aug 2, 2001
http://groups.yahoo.com/group/amibroker/message/3936, Aug 15,2001
http://groups.yahoo.com/group/amibroker/message/3941, Aug 15, 2001
http://groups.yahoo.com/group/amibroker/message/11181, Feb 22 2002
http://www.amibroker.com/library/detail.php?id=176 The Market Direction Indicator
http://www.amibroker.com/library/detail.php?id=177 Trending or Trading Indicator
Dimitris Tsokakis
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<DIV><STRONG><FONT size=2>The Relative Slope
[http://www.amibroker.com/library/detail.php?id=43] oscillates around
0 </FONT></STRONG></DIV>
<DIV><STRONG><FONT size=2>in the [-10,10] region. Direction changes in the
narrow band [-0.5, 0.5] give reliable signals</FONT></STRONG></DIV>
<DIV><FONT size=2><STRONG>for trend continuation, especially if they are massive
in a group of stocks.</STRONG></FONT></DIV>
<DIV> <FONT size=2></DIV><STRONG>
<DIV>/*Continuation of a DOWNTREND*/</FONT><FONT size=2></FONT></STRONG></DIV>
<DIV><STRONG><FONT size=2>K=EMA((H+L+C)/3,10);</FONT></STRONG></DIV>
<DIV><STRONG><FONT
size=2>S1=200*(K-Ref(K,-1))/(K+Ref(K,-1));</FONT></STRONG></DIV>
<DIV><STRONG><FONT size=2>rs=EMA(EMA(S1,3),3);</FONT></STRONG></DIV>
<DIV><STRONG><FONT size=2>s3= Ref(RS,-1)==HHV(RS,5) AND abs(Ref(RS,-1))<=0.5
; </FONT></STRONG></DIV><FONT size=2><STRONG>
<DIV>values18 = s3>0;</DIV>
<DIV><STRONG>AddToComposite(Values18,"~continuationdown","V");</STRONG></FONT></STRONG></DIV><FONT
size=2></FONT>
<DIV><STRONG><FONT size=2>/*Continuation of an
UPTREND*/</FONT></STRONG></DIV><FONT size=2><STRONG>
<DIV>K=EMA((H+L+C)/3,10);</FONT></STRONG></DIV><FONT size=2><STRONG>
<DIV>S1=2*(K-Ref(K,-1))/(K+Ref(K,-1));</FONT></STRONG></DIV><FONT
size=2><STRONG>
<DIV>rrs=100*EMA(S1,3);</FONT></STRONG></DIV><FONT size=2><STRONG>
<DIV>rs=EMA(rrs,3);</FONT></STRONG></DIV><FONT size=2><STRONG>
<DIV>s3= Ref(RS,-1)==LLV(RS,5) </FONT></STRONG><STRONG><FONT size=2>AND
abs(Ref(RS,-1))<0.5 ; </FONT></STRONG></DIV><FONT size=2>
<DIV><STRONG>values19 = s3>0;</STRONG></DIV></FONT><FONT size=2><STRONG>
<DIV>AddToComposite(Values19,"~continuationup","V"</FONT><FONT
size=2>);</FONT></DIV><FONT size=2>
<DIV>/*Population of the group*/</STRONG></FONT></DIV>
<DIV><FONT size=2><STRONG>AddToComposite(1,"~count","V"<FONT
size=2>);</FONT></STRONG></FONT></DIV><FONT size=2>
<DIV><STRONG>Buy=0;</STRONG></DIV>
<DIV><STRONG>Plot(100*Foreign("~continuationup","V"<FONT
size=2>)/Foreign("~count","V"<FONT
size=2>),"Up",5,1);</FONT></FONT></STRONG></DIV>
<DIV><STRONG><STRONG>Plot(100*Foreign("~continuationdown","V"<FONT
size=2>)/Foreign("~count","V"<FONT
size=2>),"Down",4,1);</FONT></FONT></STRONG></STRONG></DIV>
<DIV><STRONG>Title="
UP="+WriteVal(100*Foreign("~continuationup","V")/Foreign("~count","V"),1.2)+<BR>",
UP THE LAST 3
DAYS="+<BR>WriteVal(Sum(100*Foreign("~continuationup","V")/Foreign("~count","V"),3),1.2)+<BR>",
DOWN="+WriteVal(100*Foreign("~continuationdown","V")/Foreign("~count","V"),1.2)+<BR>",DOWN
THE LAST 3
DAYS="+<BR>WriteVal(Sum(100*Foreign("~continuationdown","V")/Foreign("~count","V"),3),1.2);</STRONG></DIV>
<DIV> </DIV>
<DIV><STRONG>When the signal exceeds 25% for a single day, it is an indication
that the present trend will </STRONG></DIV>
<DIV><STRONG>be continued.</STRONG></DIV>
<DIV><STRONG>Another interesting calculation is the sum of continuation
signals the last 3 days. Sometimes </STRONG></DIV>
<DIV><STRONG>it is above 50% . It is a strong confirmation for a
continuation of the existing trend.</STRONG></DIV>
<DIV><STRONG>From the trading point of view, when you receive a strong signal it
is better to wait some more</STRONG></DIV>
<DIV><STRONG>days before the probable change of the trend.</STRONG></DIV>
<DIV><STRONG>For ^NDX group, the last 28 months, the strong signals were always
correct.</STRONG></DIV>
<DIV><STRONG>Notice in the att. gif the last DOWNcontinuation signal.
</STRONG></DIV>
<DIV><STRONG>On Apr 22 it is 29%, <FONT color=#ff0000><U>the highest since Jan
2000 [!!!]</U></FONT></STRONG></DIV>
<DIV><STRONG>and the last 3 days </STRONG><STRONG>was 45% and on Apr 23 42%.
</STRONG></DIV>
<DIV><STRONG>With this indication, I would not suggest any "Buy". It would
be better to wait and watch the</STRONG></DIV>
<DIV><STRONG>continuation of the downtrend. Besides that, the Market
direction </STRONG><STRONG>and the Trending /Trading</STRONG></DIV>
<DIV><STRONG>indicators were mostly bearish. </STRONG></DIV>
<DIV><STRONG>From Apr 22 to 23 [point X], the ~macdbear crossed the descending
~macdbull. </STRONG></DIV>
<DIV><STRONG>As a bearish</STRONG><STRONG> indication, it was more than clear.
</STRONG></DIV>
<DIV><STRONG>At least you could wait until the bears turn back to lower values
!!</STRONG></DIV>
<DIV><STRONG>The next days verified all the above indications.</STRONG></DIV>
<DIV><STRONG>The Market broke a significant support and no apparent new support
is predictable. Any new level</STRONG></DIV>
<DIV><STRONG>should be tested first, before premature action is
taken</STRONG> <STRONG>.</STRONG></DIV>
<DIV><STRONG>The oscillating nature of Relative Slope makes me hope that the
same will be repeated in the future.</STRONG></DIV>
<DIV><STRONG>Amibroker functions are so powerful and may help us to avoid
crucial mistakes. After that, we can make</STRONG></DIV>
<DIV><STRONG>some sweet profits. [Tomasz will be more than happy with this last
detail...]</STRONG></DIV>
<DIV><STRONG><U><EM>References</EM></U></STRONG></DIV>
<DIV><A
href="http://groups.yahoo.com/group/amibroker/message/3588";><STRONG>http://groups.yahoo.com/group/amibroker/message/3588</STRONG></A><STRONG>,
Aug 2, 2001<BR></STRONG><A
href="http://groups.yahoo.com/group/amibroker/message/3936";><STRONG>http://groups.yahoo.com/group/amibroker/message/3936</STRONG></A><STRONG>,
Aug 15,2001<BR></STRONG><A
href="http://groups.yahoo.com/group/amibroker/message/3941";><STRONG>http://groups.yahoo.com/group/amibroker/message/3941</STRONG></A><STRONG>,
Aug 15, 2001<BR></STRONG><A
href="http://groups.yahoo.com/group/amibroker/message/11181";><STRONG>http://groups.yahoo.com/group/amibroker/message/11181</STRONG></A><STRONG>,
Feb 22 2002</STRONG></DIV>
<DIV><A
href="http://www.amibroker.com/library/detail.php?id=176";><STRONG>http://www.amibroker.com/library/detail.php?id=176</STRONG></A><FONT
face=Arial> </FONT><STRONG><FONT face="Times New Roman">The Market
Direction Indicator</FONT></STRONG></DIV>
<DIV><A
href="http://www.amibroker.com/library/detail.php?id=177";><STRONG>http://www.amibroker.com/library/detail.php?id=177</STRONG></A>
<STRONG>Trending or Trading Indicator</STRONG></DIV>
<DIV><STRONG>Dimitris Tsokakis</STRONG></DIV></FONT>
<DIV> </DIV></BODY></HTML>
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