Yup, nice price action in AAPL. Closed the week on the highs and above the monthly A up but I void out monthly A ups after the 15th of the month. But the stock is still acting well regardless. GOOG on the other hand....not so much.
The ACD Method
- Thread starter sbrowne126
- Start date
Yup, nice price action in AAPL. Closed the week on the highs and above the monthly A up but I void out monthly A ups after the 15th of the month. But the stock is still acting well regardless. GOOG on the other hand....not so much.
NFLX is getting interesting to me, the intraday A down level was a level it bounced off of only to retest it later in the day, which is close to the monthly C level. I noticed yesterday the 30 day number line got weak on it. Do you also void out Cs? Meaning if Monday a stock that had a monthly A up level makes a C down, are you back to neutral on the stock, still have a bullish bias or just won't touch it until the following month?
Not sure I'm reading this right. It's pretty rare for a stock to make a monthly C down in the same week. That would be really bearish. LOL. I void out late cycle trades. Intra-day confirms after about 11:00, weekly confirms after Wednesday, monthly confirms after the 15th and QTR confirms on the 3rd month. Goes back to the cycle thing.
Ahhh that makes sense thanks!
Can you elaborate on this further? I'm about 800 pages into this thread so if you have addressed this recently I just haven't seen it yet. I read that you start a new 30 day line each month, but you roll your 5 day line. When you say you match your number line to your A values, do you mean if you have a monthly A up level, you will then check your 30 day number line, and if you have a weekly A up level you will check with your 5 day line?
Maverick, If you have time would you give an update on the levels for the NQ including Friday intraday? Thanks
Sure. All my number lines serve a specific purpose. One of the things one needs to become good at when analyzing statistics is making sure the data you want to analyze matches up with another correlated data set. For example, if I wanted to measure obesity rates in the US I would not collect data or mix that data with all of North America. Statisticians often refer to this as "polluting" the data.
So the monthly number line I use is a static number line that attaches itself to a specific data set, in this case, the monthly A values. Again, we would be "polluting" the data if I used a 5 or 30 day to measure monthly A levels as the data would include specific data not from that monthly data set. So because of this, the monthly HAS to re-set. It can only contain data from "that" month. This data is NOT used to measure strength or weakness on a "cumulative" basis. Rather it is used only at a "specific" point in time. In this case, at A levels. Since both data sets should be telegraphing the same information, the conclusions from both should be consistent.
Now the 5 day and 30 day have completely different data sets. Since the 5 day is measuring momentum, the data you want in that set should be short term term data. It does not matter if that data crosses over from a previous week or month or quarter. Because what you are measuring is consistent in both sets.
Same with the 30 day. The 30 is measuring long term trend. Again, this data has to be consistent with that which you are seeking to measure. It does not matter if this data crosses over from week to month to quarter. You are measuring long term trend and therefore use a "rolling" number line as you do with the 5 day.
Most of this will be common sense to you as you let it sink in. You just need to be careful anytime you are making quantitative decisions that you are using the proper data to make that decision. For example, why would I use a 200 day moving average to daytrade shares of AAPL? Why would I use a 5 min breakout pattern to enter a long term trend?
Again, I want to stress, none of what I do is gospel. I created a way of collecting, organizing and analyzing data that fits MY style of trading. This is why I hate giving out specific values and formulas as "the way" to trade. You have to create your own values and formulas and they should make sense to YOU. I cannot stress this enough. And no, I'm not trying to throw you off my trail.
I once had an office full of traders who I taught this method to. I gave them my code, my levels, every detail of this. Not a single one of them made money. Again, a large part of this is because they didn't "understand" what it was, they simply accepted it as some kind of truth. That's not going to work. Trading is not about following someone else's system or ideas but finding your own and executing it flawlessly. I cannot stress that enough either. At the end of the day, you have to execute your strategy flawlessly. And more often then not, using someone else's work prohibits that.
I often get asked why I share this information on here. I share it because it's meaningless to others who just want to duplicate it. Just as I couldn't earn a single penny singing Billy Joel songs. This is going to requires years of absolute dedication and understanding. Upon hearing this, most traders move on to the next thing. I applaud your dedication so far to getting through the first 800 pages.
Wow thank you very much this is very helpful
Sorry, missed this post. The A up on Friday was 2791 for the NQ. The Nazzy has been the weaker of all the indices recently so I honestly would not have been trying to get long this product. But specifically relating to the NQ, it basically crept up all day. Didn't really stop at the A level. Pulled back in the middle of the day back below the A up before closing the day on the highs. There was really nothing about this action I would have liked. All the number lines were relatively flat coming in. Nothing really obvious here.
I hope Mav doesn't mind me reposting this, I found it burried in this thread and I think its a great nugget..
"If you have a longer term number line at plus 18 and the 5 day at minus 3, I would not want to be long because what the 5 day is telling me is price is going lower, not higher. I would much rather wait for the 5 day to go to plus 5 when the 30 day is at plus 18. What I have noticed is actually quite the opposite. For example, say you have a stock at plus 18 on a 30 day number line. Say you also have a 5 day at plus 5. Many times price has actually pulled back while "maintaining" a strong number line. This is actually the type of pullback I want to buy. Guys, this happens a lot." -MAV
"If you have a longer term number line at plus 18 and the 5 day at minus 3, I would not want to be long because what the 5 day is telling me is price is going lower, not higher. I would much rather wait for the 5 day to go to plus 5 when the 30 day is at plus 18. What I have noticed is actually quite the opposite. For example, say you have a stock at plus 18 on a 30 day number line. Say you also have a 5 day at plus 5. Many times price has actually pulled back while "maintaining" a strong number line. This is actually the type of pullback I want to buy. Guys, this happens a lot." -MAV