The ACD Method

[SteveM]

something interesting I found in manual backtesting is that buying breakouts of the high or low for the first X days in a calendar month has about a 65 percent win rate if held to close of the month.

One might be able to layer intraday acd with this 65 percent bias and only take A trades in the direction of the daily bias to enhance returns....im sure many have already looked at this but figured I would throw it out there.

 

[Robert Yanks]

I basically use only ACD and a lot of stuff from this thread, so better learn from original man - Maverick (btw I saw his 20001 post in some thread a while ago). I also coded reversal indicators from Fisher's book and found that they very often signal reversal but needs some other confirmation (have this signal on FXI now (china) and knowing that it is a big bubble and fundamentals are not that good over there and almost 50% of that etf is chinese financials it could be a good fundamental confirmation so maybe its a good moment to try timing this bubble). I use automated NLs which are nice but not that terribly effective alone. For levels, I like to have some "story" or theory and then, I might fade weekly or monthly if it fits my theory, but if A later confirms then my idea is probably wrong. If A is confirmed I usually wait for pullback to that A level but that sometimes misses good trades. Also I have coded my application which shows prices in columns like Livermore described in his book. It is useful to quickly see where the price is - bullish trend, bearish trend, natural reaction, natural rally etc. That helps when watching a lot of products, but I will probably need to scale down on that - too much is not good either as you loose focus... My master plan is machine learning trading so currently working on that

Hello Ignl,

Great stuff man and thank you! And here I thought I was the only one looking at the Fisher Reversal pattern. What are you using to generate your auto number lines? It would be terrific if you posted one of your Livermore type charts. I have a few other questions I'll ask later.

Thanks again.

 

[Robert Yanks]

Here’s a couple examples of the “Fisher Reversal” pattern. In a nutshell, the two I'm showing required two consecutive A Downs (though they don't have to be in order ..... "What"?) and then an A Up that is higher than the two A Downs. Fisher says "You're trying to capture market failures." You know, catch short shorts with their pants down.

Darden Restaurants (DRI)

Obvious:
Sitting on a swing low. Large volatility increase in the last couple of months. Possible range between 61 and 70. Broke a 4 touch descending trend line today.

Not so Obvious:
Fisher Reversal bar today. Monthly A Up at 66 (approximately close to descending trend line).


Motorola Solution (MSI):

Obvious:
Sitting on the October low support line. Declining Exp 50 DMA waiting around 62.65 Unbroken 9 touch declining resistance trendline in play. Bottom dwelling Stoch with lots of upside potential. Range bound between 58 and 70. Resistance in the usual places.

Not so Obvious:
Fisher Reversal bar today. Sitting right smack on the Yearly A Down at 58.74, and the Yearly A up is at 71.81 (imagine that …. top of the range). Wait …. the Quarterly A Dow is at 58.68 (I can’t make this stuff up!). A hungry Stoch just waiting to do some steep rock climbing.


We’ll see

 

[ignl]

Here’s a couple examples of the “Fisher Reversal” pattern. In a nutshell, the two I'm showing required two consecutive A Downs (though they don't have to be in order ..... "What"?) and then an A Up that is higher than the two A Downs. Fisher says "You're trying to capture market failures." You know, catch short shorts with their pants down.

Darden Restaurants (DRI)

Obvious:
Sitting on a swing low. Large volatility increase in the last couple of months. Possible range between 61 and 70. Broke a 4 touch descending trend line today.

Not so Obvious:
Fisher Reversal bar today. Monthly A Up at 66 (approximately close to descending trend line).


Motorola Solution (MSI):

Obvious:
Sitting on the October low support line. Declining Exp 50 DMA waiting around 62.65 Unbroken 9 touch declining resistance trendline in play. Bottom dwelling Stoch with lots of upside potential. Range bound between 58 and 70. Resistance in the usual places.

Not so Obvious:
Fisher Reversal bar today. Sitting right smack on the Yearly A Down at 58.74, and the Yearly A up is at 71.81 (imagine that …. top of the range). Wait …. the Quarterly A Dow is at 58.68 (I can’t make this stuff up!). A hungry Stoch just waiting to do some steep rock climbing.


We’ll see

I kinda get plenty of reversal signals so need to be picky as some simply doesn't tell anything and doesn't work, some are good only for one-two days and only some predicts real longer term reversal. So better combine it with something. In MSI case I would be extremely extremely cautious. That huge drop on high volume - its big red flag for me. Also negative numberlines. Also it isn't reversal for me - I think I coded some more filters, like it must close above previous A up or something like that. Also it kinda entered downtrend for me (see attached picture). Unfortunately I don't follow DRI.

 

[Robert Yanks]

I kinda get plenty of reversal signals so need to be picky as some simply doesn't tell anything and doesn't work, some are good only for one-two days and only some predicts real longer term reversal. So better combine it with something. In MSI case I would be extremely extremely cautious. That huge drop on high volume - its big red flag for me. Also negative numberlines. Also it isn't reversal for me - I think I coded some more filters, like it must close above previous A up or something like that. Also it kinda entered downtrend for me (see attached picture). Unfortunately I don't follow DRI.

Good input Ingl.

 

[Robert Yanks]

There were 10, Fisher 5 day reversal up day signals in the S&P500 on Friday. Basic pattern requires the most recent 5 days to have a low that’s lower than the prior 5 days and today’s close higher than the prior 9 days. Randomly picked two for illustration.

Johnson & Johnson (JNJ)

Obvious chart correlations:
· Rising support trendline (higher lows) and descending resistance trendline (lower highs) since October.

· Friday’s close clearly broke the descending resistance line.

· Stoch is less than 50.

· 50 and 200 day MA’s somewhat flat and not of much consequence.

Not so Obvious:
· Fisher 5 day reversal up.

· The 2/12/15 wick pierced the Yearly A Down and it has held with ease.

· Our leader Mav has pointed out many times that it is not unusual for a failed Yearly A Down to climb to the Yearly A Up.

· Monthly A up at 102.10 and Quarterly A up at 103.60.


Public Storage (PSA)

Obvious chart correlations:

· A couple of obvious ranges since early December.

· A mini mini double bottom at an obvious horizontal support line.

· Most importantly: it stopped dead on a rising 200 DEMA.

· Friday broke a 7 touch descending trendline and closed above a descending 50 DMA.

Not so Obvious:

· Fisher 5 day reversal up.

· Failed Quarterly A Down at 198.10

· Quarterly A Up at 205.63

· Friday’s high hit the Monthly A Up at 196.45

 

[hoop121]

Win Loss ratio and taxes, small trading including ACD

So you feel the ACD method keeps you out of trades and into good one's cutting losses short and keeping winners? Who is making money using this "method" ?

Take a look at taxes and risk reward I.E. you make some money great, get ready to pay taxes, lose, you get a small write down about all- and what did it take to "earn" your "money" , so what is the real return risk adjusted, in the big picture when you think about trading small is it worth it?

lol, is your post suggesting that Mav is no longer active because he blew up?

Mav is doing well, guys. He's focused on taking ACD to whole new levels. Pun intended.

 

[wow12]

lol, is your post suggesting that Mav is no longer active because he blew up?
Mav is doing well, guys. He's focused on taking ACD to whole new levels. Pun intended.

hoop121, give him my regards. I think trilogic was trying to bait Mav back.

 

[trilogic]

no not at all, trading small worth it ? most "names" in the industry used big money, let talk about pikers that had 100k and now throwing size ?

They must exist right ? And I mean trade OWN money

 

[Robert Yanks]

Three stocks that made weekly A Ups today with patterns that I don’t mind taking a look at.

Boeing (BA): The obvious is a sorta double bottom near a rising 200 day EMA with a nice low Stoch. Today’s close took out the previous three day closes and there are a number of potential resistance areas. The not so obvious is today’s weekly A Up, today's high that’s already at the monthly A Up and a Quarterly A Up at 156.80

Expediters International of Washington (EXPD): The obvious is the recent range bound action with an almost touching triple bottom. Good low Stoch and not a great deal of difficult resistance. The not so obvious is the weekly A Up and the Quarterly A Up at 49.88

Priceline Group (PCLN): An obvious big ass bullish engulfing today sitting in the area of old resistance and recent support. It has low Stoch and may be seriously considering a run at filling the month old gap. Again, the not so obvious is today’s weekly A Up, today’s high an inch from hitting the monthly A Up, and the Quarterly A Up at 1254.82