Thursday, June 19, 2014 7:40:46 AM
I have gone back to a number the Ocroft Posts and the responses it created.
My conclusion is that after a number of discussions then, I had a rather good general understanding of what Ocroft was doing. . .again slight variations on the theme not really being relevant.
For example, I understood that Ocroft would sell all at a 20% overall profit, or higher. . .the exact details also are not relevant, the important thing being is to be satisfied with the profit that is realized. It appeared that on one occasion he stated that he would sell all equity as the uptrend reversed. . .This is the same thing as is done under TA.
On the Buying Side he started with the AIM 50/50 CER. . .or 70/30 if that would have been advised via other indicator. His AIM Buy Point would be determined by looking back at the price behavior and identifying a Price Reversal relative to the previous prices, or a stop in the price Price Decline. A very sensible Buy Point Method that I also generally advocated in my book The Vortex Method. It is not so that Ocroft would decide to invest in a stock and THEN wait for a Price Decline and a Reversal to step in.
Here are some of the relevant posts on the topic:
*******************************************************
Post 31574 Ocroft himself:
When the mkt order(1/2 added to PC) stops the PC from changing or rising, i will enter an actual buy order at that price at that point.
…
…
Conclusion: This is all that i am trying to convey to the AIM users; go ahead and use the by the book method, however, enter your buy orders on the PC (stop changing or rising) side of the stock.
This indicates the Price Reversal Indicator Ocroft is using. The fact that this could be an 8 % price rise or a 12 % rise is not very relevant.
Post 31595. . . Ocroft himself:
I just plot the stock by hand and BTB. I use those figures to make a buy entry point. I will give you a short example of the way I use AIM.
I just actually purchased FNLC at $14.74.
Now, in my equity warehouse, I only purchase and include A+ rated Standard & Poor's stocks.
Before I made a buy entry in FNLC,I went back to its high price of $21.70. Hand plotted its monthly closing price BTB from that point and got in at $14.74 when its PC stopped rising.
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Post# 31602
Monday, March 29, 2010 4:38:31 AM
To: lostcowboy
My Response to Post # 31601
Howdie Cowby!
Your explanation is exactly as I understand it as to what Ocroft is doing. Thank you! So now I know I am not going senile yet!
Now the puzzling thing is this. When the price has bottomed out and reversed a bit even from 4 to 5 then the FIRST thing that is obvious is the FACT that this has happened. . .one knows this because one is looking at the prices and this fact is obvious BEFORE the price is fed into the AIM Machine and from that the investor can see plainly that a price reversal has taken place of 25% from $4 to $5. That signal is strong enough to decide to buy the amount of shares that has been calculated already for the price of $4. . .(Accumualated Buy Amount). There is no need to look at the PC because at the price of $5 (25% rise) there is no Buy Signal. .and with a holding zone of 10% one would probably get a Sell signal as the AIM system has assumed that the Buy at $4 was executed.
The fact that Ocroft then jumps in at $5 is not relevant. He could as well decide to wait for the price to go to $ 6 to make sure the $5 price is not an incidental jitter, with the price dropping to $3 thereafter.
My point is that he does not have to look at what the PC will do at $5 in order to decide to start buying. The fact that the price is at $5 is the primary indicator and if the stock stays at 5 for a while then it is an even better indicator that bottoming-out has taken place.
Why look at the PC then????
***************************************************
The point of my question tat the time: "Why loop at the PC" simply meant that if a price stopped dropping then it was obvious that the price had become level or had started to rise again.
The fact that Ocroft actually used the PC as a Reversal Indicator is perfectly fine. . .I simply argued at the time that one could simply track the price reversal in any other way and make a Buy Decision on it. That Ocroft looked at the PC in AIM is simply another way of "spotting" a Price Reversal that could be used for triggering the actual buys.
There is no need to get into all this again on small points of differences. Its the general idea of finding an effective Buy Delay Method that would generally prevent one from burning the money on a deep diver that does not come back.
Over and Out
My conclusion is that after a number of discussions then, I had a rather good general understanding of what Ocroft was doing. . .again slight variations on the theme not really being relevant.
For example, I understood that Ocroft would sell all at a 20% overall profit, or higher. . .the exact details also are not relevant, the important thing being is to be satisfied with the profit that is realized. It appeared that on one occasion he stated that he would sell all equity as the uptrend reversed. . .This is the same thing as is done under TA.
On the Buying Side he started with the AIM 50/50 CER. . .or 70/30 if that would have been advised via other indicator. His AIM Buy Point would be determined by looking back at the price behavior and identifying a Price Reversal relative to the previous prices, or a stop in the price Price Decline. A very sensible Buy Point Method that I also generally advocated in my book The Vortex Method. It is not so that Ocroft would decide to invest in a stock and THEN wait for a Price Decline and a Reversal to step in.
Here are some of the relevant posts on the topic:
*******************************************************
Post 31574 Ocroft himself:
When the mkt order(1/2 added to PC) stops the PC from changing or rising, i will enter an actual buy order at that price at that point.
…
…
Conclusion: This is all that i am trying to convey to the AIM users; go ahead and use the by the book method, however, enter your buy orders on the PC (stop changing or rising) side of the stock.
This indicates the Price Reversal Indicator Ocroft is using. The fact that this could be an 8 % price rise or a 12 % rise is not very relevant.
Post 31595. . . Ocroft himself:
I just plot the stock by hand and BTB. I use those figures to make a buy entry point. I will give you a short example of the way I use AIM.
I just actually purchased FNLC at $14.74.
Now, in my equity warehouse, I only purchase and include A+ rated Standard & Poor's stocks.
Before I made a buy entry in FNLC,I went back to its high price of $21.70. Hand plotted its monthly closing price BTB from that point and got in at $14.74 when its PC stopped rising.
***************************************************
Post# 31602
Monday, March 29, 2010 4:38:31 AM
To: lostcowboy
My Response to Post # 31601
Howdie Cowby!
Your explanation is exactly as I understand it as to what Ocroft is doing. Thank you! So now I know I am not going senile yet!
Now the puzzling thing is this. When the price has bottomed out and reversed a bit even from 4 to 5 then the FIRST thing that is obvious is the FACT that this has happened. . .one knows this because one is looking at the prices and this fact is obvious BEFORE the price is fed into the AIM Machine and from that the investor can see plainly that a price reversal has taken place of 25% from $4 to $5. That signal is strong enough to decide to buy the amount of shares that has been calculated already for the price of $4. . .(Accumualated Buy Amount). There is no need to look at the PC because at the price of $5 (25% rise) there is no Buy Signal. .and with a holding zone of 10% one would probably get a Sell signal as the AIM system has assumed that the Buy at $4 was executed.
The fact that Ocroft then jumps in at $5 is not relevant. He could as well decide to wait for the price to go to $ 6 to make sure the $5 price is not an incidental jitter, with the price dropping to $3 thereafter.
My point is that he does not have to look at what the PC will do at $5 in order to decide to start buying. The fact that the price is at $5 is the primary indicator and if the stock stays at 5 for a while then it is an even better indicator that bottoming-out has taken place.
Why look at the PC then????
***************************************************
The point of my question tat the time: "Why loop at the PC" simply meant that if a price stopped dropping then it was obvious that the price had become level or had started to rise again.
The fact that Ocroft actually used the PC as a Reversal Indicator is perfectly fine. . .I simply argued at the time that one could simply track the price reversal in any other way and make a Buy Decision on it. That Ocroft looked at the PC in AIM is simply another way of "spotting" a Price Reversal that could be used for triggering the actual buys.
There is no need to get into all this again on small points of differences. Its the general idea of finding an effective Buy Delay Method that would generally prevent one from burning the money on a deep diver that does not come back.
Over and Out
Conrad Winkelman
What is Vortex AIMing? Look for my Vortex Discussion Forum:
http://investorshub.advfn.com/boards/board.asp?board_id=1341
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