Spydertrader's Jack Hershey Equities Journal

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On days like today when HANS absolutely destroys its lowerband DU, do you care that the MACD is under the desired value? Given that the Stoch's in an OK range and as far as I understand it, this is indisputably a break out in volume, are you going to enter the position anyway?

Just trying to get up to speed!

NewGuy
 
I think I can answer this. Nope. Because all the criteria must be in check or it wouldn't be a system. Todd-correct me if I am wrong.
 
I can definately appreciate that point of view, and for the most part, I agree with it. I've noticed tho, at times in the past the fundamental concepts behind the system override some of the specific parameters.

There was a post not too far back where Spyder failed to take a trade that was indicated properly only because it was signalled three minutes before 11:30. His reason was that it wasn't a very strong signal, given that it was so late in the morning. Conversly, HANS seems like a very strong signal, becuase my indication shows that it is over %1000 of the LBDU currently. Just a point to consider...

Also, has anyone considered the effect of the near-exponential growth of hedge funds in the last few years on this system? It seems like the "smart money" is getting a lot dumber, and logically that could be causing some FBO's, IMHO, anyway.

Thanks for your reply, Kevin.

NewGuy
 
Quote from KevinK:

I'm sure there's reason behind buying screeners...please explain.
More...

Here are two fantastc stock screeners that are absolutely free:

Reuters Powerscreener:
http://www.investor.reuters.com/ArticleEntry.aspx?target=/opinion

Look to the left where all the links are and select 'Powerscreener'. You'll have to sign up for a free account. You can use this to check the float on an entire list of stocks if you like and you can also build a screener to find growth stocks with +EPS, great EPS growth and with good price movement (RS). They don't have the same variables as Stocktables, but you can certainly find the same style of stocks.

MSNBC Deluxe Screener:
http://moneycentral.msn.com/investo...tral.msn.com/investor/finder/customstocks.asp

Again, you'll have to go through a sign up process and download the investing tools stuff, but this one is a great screener as well and its a little easier to use that the Reuter's one. Float isn't a variable on this screener though. Shares outstanding can be used instead to closely approximate it.

Somewhere in this journal I posted a screen for MSN's stockscreener which approximates the JH Stocktables screen pretty well. You can download it from here and then upload it to the MSN screener. You should get a list real close to Spyder's.

Using these two screeners won't give you an identical list as Spyder's, but it will be close and many of the stocks will be the same. As I've been watching this method progress on this thread, I've noticed that as long as the same style stocks are being picked, the screener doesn't really matter as much.

If you have a subscription to IBD you can also use their Screen of the Day and the IBD 100 downloadable files to get a good list of high quality growth stocks.

Hope that helps out those with limited budgets or the cheap people out there (me). Spyder, I'm still watching with interest - keep up the great work.
 
2005-07-18, Monday - Update

This morning, I monitored one list of stocks (11 total equities): Those equities from our daily Hot List and from our Final Universe List finding themselves "In Dry Up."

Dry Up Stocks

BCSI CKCM CMT ENER HANS IIG MCRI NGPS TASR UBET VDSI

Our system generated seven possible trade signals from the list of eleven Dry Up Stocks when actual volume exceeded calculated "Low Band" Dry Up Volume prior to 11:30 AM.

Dry Up Stocks Triggering Signal

BCSI CKCM CMT ENER HANS MCRI NGPS

Dry Up Stocks NOT Triggering Signal

IIG TASR UBET VDSI

HANS DID show price improvement ($102.74) at time of signal generation (9:40 AM). In addition, MACD Histogram showed a positive return (+.7281). Also, The Stochastic Indicator fell above desired levels (89.0115). However, price on HANS gapped up over 6% this morning. I avoid trading stocks which gap by such magnitudes. As a result, I took no action with respect to trading HANS.

ENER DID show price improvement ($23.09) at time of signal generation (10:16 AM). In addition, MACD Histogram showed a positive return (+.0298). Also, The Stochastic Indicator fell above desired levels (88.0011). As a result, I entered into a long position with 1000 shares of ENER receiving a fill of $23.10 USD.

CMT DID show price improvement ($10.55) at time of signal generation (10:44 AM). In addition, MACD Histogram showed a positive return (+.0394). Also, The Stochastic Indicator fell above desired levels (94.7487). However, price on HANS gapped up over 6% this morning. I avoid trading stocks which gap by such magnitudes. As a result, I entered into a long position with 2000 shares of CMT receiving a fill of $10.55 USD.

BCSI did NOT show price improvement ($29.95) at time of signal generation (10:50 AM). In addition, MACD Histogram showed a positive return (+.0367). Also, The Stochastic Indicator fell below desired levels (41.4963). As a result, I took no action with respect trading BCSI.

MCRI did NOT show price improvement ($24.46) at time of signal generation (10:58 AM). In addition, MACD Histogram showed a negative return (-.0228). Also, The Stochastic Indicator fell below desired levels (53.33). As a result, I took no action with respect to trading MCRI.

NGPS did NOT show price improvement ($30.55) at time of signal generation (11:03 AM). In addition, MACD Histogram showed a positive return (+.2786). Also, The Stochastic Indicator fell below desired levels (75.13). As a result, I took no action with respect to trading NGPS.

CKCM DID show price improvement ($23.06) at time of signal generation (11:16 AM). In addition, MACD Histogram showed a positive return (+.0734). Also, The Stochastic Indicator fell above desired levels (98.0635). However, while making my decision with respect to position size, I noticed The Stochastic Indicator began to fall below our desired parameters to 78.8965. Because the parameters required for entry into a long position had changed, I failed to enter into a long position with respect to CKCM.

You may recall my use of Ross's Rule on the first trading day when entering into a trade. Ross's Rule states we must exit a trade anytime on the first day when price heads into negative territory with respect to the previous day close. According to QCharts, ENER closed Friday at the $22.996 price point. As a result, when price for ENER hit the $22.99 price point, Ross's Rule required I exit. The resulting exit yielded a loss of .11 or -$110 USD on 1000 shares.

- Spydertrader
 
I apologize for not answering sooner, but the market kept me quite busy this morning.

Quote from thenewguy:

On days like today when HANS absolutely destroys its lowerband DU, do you care that the MACD is under the desired value? Given that the Stoch's in an OK range and as far as I understand it, this is indisputably a break out in volume, are you going to enter the position anyway?
More...

Clearly a volume breakout has occurred with HANS. However, price also gapped up significantly from Friday's Close. Due to price exceeding a 6% gap up, I ignored HANS.

Quote from KevinK:

I think I can answer this. Nope. Because all the criteria must be in check or it wouldn't be a system.
More...

KevenK correctly answers how I trade the system. I require the all the planets to line up accordingly. Failure to do so keeps me out of a trade. However, I encourage everyone to test various theories in an effort to improve upon the system as a whole.

Quote from thenewguy:

There was a post not too far back where Spyder failed to take a trade that was indicated properly only because it was signaled three minutes before 11:30.
More...

When using Dry Up Volume Range, we need to keep in mind the earlier a signal triggers in the morning, the more likely that equity reaches FRV by EOD. The closer to 11:30 AM the system triggers a signal, the greater the probability an FBO will occur.

Quote from thenewguy:

Also, has anyone considered the effect of the near-exponential growth of hedge funds in the last few years on this system? It seems like the "smart money" is getting a lot dumber, and logically that could be causing some FBO's, IMHO, anyway.
More...

This very well could be the case.

- Spydertrader
 
2005-07-18, Monday - FRV Update

Dry Up Stocks Reaching FRV by EOD

HANS

Dry Up Stocks NOT reaching FRV by EOD

BCSI CKCM CMT ENER IIG MCRI NGPS TASR UBET VDSI

- Spydertrader
 
Quote from Spydertrader:

HANS DID show price improvement ($102.74) at time of signal generation (9:40 AM). In addition, MACD Histogram showed a positive return (+.7281). Also, The Stochastic Indicator fell above desired levels (89.0115). However, price on HANS gapped up over 6% this morning. I avoid trading stocks which gap by such magnitudes. As a result, I took no action with respect to trading HANS.
More...

Hi Spyder,

My data showed that HANS closed on Fri. at 97.80 and opened this morning at 100, which is a gap of +2.25%, not nearly close to the 6% gap you mentioned. Just out of curiosity, what prices do you have for Fri. close and today's open?

Thanks

TJ
 
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