Spydertrader's Jack Hershey Equities Journal

[nwbprop]

Quote from Spydertrader:

I use a 5% stop loss and a 10% target. Using pro-rata volume to enter into a trade improves the the overall performance of the system from a dollar standpoint without increasing the risk / reward ratio. This was the point I attempted to make. While admittedly, I do not have enough pro-rata trades to definitively express the use of pro-rata volume in absolute terms, under current market conditions (and current market conditions may just be the key to determine when and when not to use pro-rata volume) it appears to provide a superior method of entry. Once we enter a period of flat or falling markets, we should have a better grasp of when and when not to use pro-rata volume, as well as, which levels work the best.

- Spydertrader [/B]

I use the MACD and Stoch on a Daily INDU chart to get the overall market conditions. What are you guys using to deterimine the current market conditions?

 

[Spydertrader]

I apologize for the late post, but a blown transformer caused a local power outage here for the majority of the trading day. Fortunately, our system did not trigger a trading signal today. None of our Watch List Stocks experienced actual volume that exceeded calculated Dry Up Volume prior to 11:30 AM. As a result, we take no trades today.

After reviewing today's charts (when power finally returned to my home), I noticed ASKJ really took off in price. We have ASKJ listed as one of our "Dry Up Stocks with a G33M4K Score of Zero." If we use the same entry rules previously discussed for stocks of this type (Actual Volume exceeding Previous Day Volume), our system triggers a buy signal on ASKJ, at 1:07 PM. Price at that time held at $25.98. Both MACD (+.1021) and The Stochastic Indicator (+80.0017) fell within desired parameters. Although the lack of power to my home prevented me from seeing this trade develop, we do now have another example of a positive result from alternative entry criteria. While additional study is warranted, the results continue to appear promising.

Again, I made no trades today.

Quote from nwbprop:

I use the MACD and Stoch on a Daily INDU chart to get the overall market conditions. What are you guys using to deterimine the current market conditions?

I found this gem either on USENET or right here on ET for determining market bias. Sorry I cannot recall the exact location, but what follows is a direct quote:

Quote from either USENET or ET:

This is the best long/short indicator I know: The closer to the upper band we get the more likely that the bleeding will stop and bias changes from down to flat/up. The closer we get to the bottom band the more likely that euphoria has set in and the bias will soon change from up to flat/down. Go here:

http://finance.yahoo.com/q/ta?s=^VXO&t=3m&l=on&z=m&q=l&p=m10,b,p&a=&c=

I hope you find the above information useful.

- Spydertrader

 

[makosgu]

Quote from nwbprop:

Glad to see everyone had a safe and happy holiday. It is very cool that you have an EE background like Jack. For pace vs fractal, I have found that the MACD gives me the best clue as to what the dominant fractal at play is. If the lines are divergeing, than the faster fractal is dominant. If they are entwining, then the current fractal is dominant.

I also usually find that pace will slowly migrate down to no pace, and then jump to the fastest pace and then slowly migrate down again. All related to volume.

Dominant fractal... Interesting. Let me ask more specific Qs. I am currently oriented to understanding pace and volume as synonymous (ie. strong volume yields a fast pace, average volume yields normal pace, weak volume = slow pace, DU = no pace or drift). In dollars and cents, strong volume yields quicker pace (ie. greater price distance per unit of time). Now here's where I am in a quandry, what tools identify the precursors to pace changes. Volume surely is one, but what else can it be used with to confirm? Second, once a pace is established, what can I check to confirm that the pace is continuing (I presume stoch stays entwined outside of the 20/80 tape) but what is the state of MACD?

Thanks
G33M4K

 

[makosgu]

Quote from makosgu:

Dominant fractal... Interesting. Let me ask more specific Qs. I am currently oriented to understanding pace and volume as synonymous (ie. strong volume yields a fast pace, average volume yields normal pace, weak volume = slow pace, DU = no pace or drift). In dollars and cents, strong volume yields quicker pace (ie. greater price distance per unit of time). Now here's where I am in a quandry, what tools identify the precursors to pace changes. Volume surely is one, but what else can it be used with to confirm? Second, once a pace is established, what can I check to confirm that the pace is continuing (I presume stoch stays entwined outside of the 20/80 tape) but what is the state of MACD?

Thanks
G33M4K

On top of this, everything seams to point to pace being relative. Let me furthur expand. After several weeks of channeling, to acquire NLPs, in relentlessly drawing channels right down through 4 of the 7 fractals (EOD, 30M, 5M, 1M), it became clear that the channels of the faster fractals construct the channels of the successively slower fractals. This would indicate that pace is relative. So what is pace??? It seams like I've hit a wall here since the question does not make sense without a fractal context. What is the EOD/30M/5M/1M pace? Is that a better Q?

Nwbprop Q? How does a fast pace on the fastest possible fractal (1M) matriculate through to an EOD? Am I thinking about all of this from the wrong vantage point? Presumably, this is where the cyclic phase aspects of adjacent fractal pairs come into play. If this were so, could one just superimpose MACDs for each fractal on the 1M chart and observe for in/out phase aspects across the 4 MACDs? This would considerably smooth out the curves for the benefit of evaluating the trading fractal price velocity (first derivative).

I understand that JH assists by addressing Q's from the inquirers context, but to be able to answer Q's in such a way requires the person to have nearly an all encompassing paradigm. My apologies to those whom I thoroughly respond to your PM's. It is for this reason that I cannot respond thoroughly to your excellent Q's.

Kind Regards,
G33M4K Beginner

 

[Spydertrader]

Quote from makosgu:

Now here's where I am in a quandry, what tools identify the precursors to pace changes. Volume surely is one, but what else can it be used with to confirm? Second, once a pace is established, what can I check to confirm that the pace is continuing (I presume stoch stays entwined outside of the 20/80 tape) but what is the state of MACD?

While I cannot speak for Jack, I can tell you what has worked for me. I watch volume first and foremost. When the pace of volume begins to slow, I start to look closely at The Stochastic Indicator. MACD is usually positive at this point, but may reside in a negative state. Also, as srvz pointed out in another post, The Stochastic Indicator may be undergoing a temporary digression, and one needs to check back with volume again before decision making can continue.

Basically, the whole thing comes down to Jack's Jokari Window. An online version of Jack's Jokari Window is located at the following URL under the "Tomorrow's Paper" link:

http://sputnick5.www8.50megs.com/

I hope you find the above information helpful.

- Spydertrader

 

[Spydertrader]

Sevens - Ones - Zeros
RATE - BKS - CCJ
AMX - ESI - CMTL
CEDC - LEND - TKC
RIO - MRVL - ENWV
SFNT - URBN - ANTP
STZ - ULBI - DVA
FARO - HLEX - LSCP
PMTI - DRL - DHI
NTES - EEFT - FINL
DRIV - MTEX - NTAP

Hotlist

ANTP
RATE
ULBI
PMTI

Watch List

GOAM - DU Cycle - Du5
PACT - DU Cycle - Du5
IDSA - DU Cycle - Du5 - DU10
BCSI - DU Cycle - Du5
EBKR - DU Cycle
ESMC - DU Cycle - Du5 - DU10
CALM - DU Cycle - Du5
ULBI - DU Cycle
GDP - DU Cycle
PETD - DU Cycle - Du5 - DU10
SINA - DU Cycle - Du5 - DU10
VSEC - DU Cycle - Du5 - DU10 - DU20
ANIK - DU Cycle - Du5

SRVZ Wealth Lab Equations - Dry Up

ANIK
EBKR
INTN
PACT

G33M4K Score for the above Stocks

ANIK - 0
EBKR - 3
INTN - 7
PACT - 5

Gallas2 "Keep an Eye on These" Stocks

ENWV (Attached)

Dry Up Stocks with G33M4K Master List Score of Zero

ANIK

(GOAM, ANTP, IDSA, NGPS, LWAY, HRT, VSEC & NVEC have float outside normal parameters)

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=666467>

 

[Spydertrader]

EBKR

Our system generated a signal this morning around 9:40 AM when actual volume for EBKR exceeded calculated Dry Up Volume.
Unfortunately, we do not see price improvement (previous day close $11.88), nor do we have a postive MACD (-.0005), but The Stochastic Indicator (99.9987) remains strong. In addition, the average daily volume for EBKR falls under our desired parameters.
As a result of EBKR failing to meet our trading criteria, we do not take this trade.

- Spydertrader

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=666633>

 

[nwbprop]

Quote from makosgu:

Dominant fractal... Interesting. Let me ask more specific Qs. I am currently oriented to understanding pace and volume as synonymous (ie. strong volume yields a fast pace, average volume yields normal pace, weak volume = slow pace, DU = no pace or drift). In dollars and cents, strong volume yields quicker pace (ie. greater price distance per unit of time). Now here's where I am in a quandry, what tools identify the precursors to pace changes. Volume surely is one, but what else can it be used with to confirm? Second, once a pace is established, what can I check to confirm that the pace is continuing (I presume stoch stays entwined outside of the 20/80 tape) but what is the state of MACD?

Thanks
G33M4K

I am not sure I have things totally correct but this is what I understand from experience. When I see congestion on one fractal which means a decreasing volume and oscillations falling on that fractal, I go to a fractal higher where taping will occur or congestion. I will then use the slower fractal to time my entries and exits using price and volume. The best example is when you come out of centering during midday on the ES. You start out at no pace, then get a BO into extreme fast pace. The 30 sec chart will make oscillations, then when the 30sec fails, the 2 min chart will make oscillations for fast pace, then fail......5 min oscillations........etc. Ripples on down.

jc

 

[Spydertrader]

ANIK

Out of our entire Watch List of stocks, ANIK remains as the only equity experiencing Dry Up Volume and possessing a G33M4K Master List Score of Zero. At 10:40 AM, ANIK triggered a signal when actual volume exceeded calculated Dry Up Volume. However, it is important to note, ANIK failed to exceed its previous day volume (PDV). In addition, we did not see price improvement over the previous day (currently down .07 at $8.53). Both MACD (-.0136) and The Stochastic Indicator (64.9998) fail to achieve minimum values. As a result, we take no action in regards to ANIK, but monitor waiting for actual volume to exceed previous day volume in order to evaluate further.

- Spydertrader

<img src=http://www.elitetrader.com/vb/attachment.php?s=&postid=666673>

 

[svrz]

Quote from nwbprop:

I use the MACD and Stoch on a Daily INDU chart to get the overall market conditions. What are you guys using to deterimine the current market conditions?

In all of my research, I have not found a better indicator than MACD(5,13,6) to determine the direction of the trend and even turning points. Of course during sideways markets, the whipshaw effect will be fully present and other filters need to be applied.