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Hi:
Pete, I am taking the liberty of sending you a couple of e-mails on
volume. This is one of my favorite technical indicators and thought
maybe we could compare notes? Do you know about Wyckoff's
theories on volume? Also,can you share the formula for calculating
your indicators? Also, I assume what you say in this e-mail is the
same formula and indicators you posted this past Thursday?
Thanks for any feedback you can provide.
Best wishes,
Chas
-----Original Message-----
From: Pete <plieber@xxxxxxxxxxxxx>
To: RealTraders <realtraders@xxxxxxxxxxx>
Date: Wednesday, October 25, 2000 10:35 PM
Subject: [RT] Market Indicator
>In response to your questions about my indicator, it's nothing more than a
>cumulative sum of the volume flowing in and out of the individual
components
>of each index (the NDX & OEX have a 100, the DJIA - 30). That's why I use
>my Windows on Wall Street program and not TradeStation. TradeStation only
>lets you follow no more than 50 securities (data1, data2, .etc).
>
>Indicators indicate. It's just as simple as that. Most of the time
they're
>in sync with the market/security/commodity. To me they only give signals
>when they are out of sync with the market. I don't care for Stochastics
or
>RSI or any other oscillator type indicator. If I would use them, I
wouldn't
>look for cross-overs or over-bought or over-sold levels (e.g. <30 or >70),
>but rather divergences in amplitude. For example if a security is at the
>same level it was two weeks ago but the amplitude of the
>Stochastic/RSI/MACD/etc is lower - I'd look to sell the sucker.
>
>The indicator I put up hit a new low in both the OEX and NDX. I would
think
>that these markets should follow and hit new lows also. It is guaranteed?
>Of course not. It is just indicated. Like most technicians I like to
sell
>double tops and buy double bottoms, especially when (insert your favorite
>indicator) fails the match its previous amplitude.
>
>Trading is gambling. I'm the idiot who will ante all night until he has a
>playable hand and then bet big. Will I win every one of those hands? Of
>course not! But over the years I've made more money playing poker with my
>buddies than I've lost. The same principle applies to the stock market.
If
>you play enough of the unconfirmed peaks or troughs, you will experience
>losing trades but on balance should make money.
>
>Having said all that I also like to buy breakouts - buy high and
(hopefully)
>sell higher. Of course, you can sell low also. Again breakouts must be
>confirmed by, yep, you guessed it, an indicator. For me it's a volume
>indicator. A couple of weeks ago an RT'er astutely observed that volume is
>less of a good indicator as it once was. He reasoned, correctly I believe,
>that institutional buying has distorted much of the predictive power of
>volume. I would agree to a point. Volume as an indicator seems to work
>better for NYSE stocks than NASDAQ and volume usually works better for low
>to mid-cap companies than it does for large cap or heavily traded
>securities.
>
>Forgive my rambling. For you literary types I call it my stream of
>unconsciousness. Oh yes, by the way, I do except to shortly see new lows
in
>the NDX and OEX. Because an indicator is indicating.
>
>
>
>
>To unsubscribe from this group, send an email to:
>realtraders-unsubscribe@xxxxxxxxxxx
>
>
>
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