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Re: AIMAGIC post# 8564

Tuesday, 11/16/2021 6:27:06 PM

Tuesday, November 16, 2021 6:27:06 PM

Post# of 8728
Aimagic,

I want to toss the following idea past you.

Here's my thinking. As I stated before, you want to start with more cash or all your cash if the play is at or very near a major low in it's trend, and you only want to start with no cash or very little cash if price is at or near it's high in it's trend. Obviously you want the available cash when the play drops to average in at lower prices. Vice versa when the play is at it's lows already you want to buy a bigger position to sell in partial amounts as the price rises.

So then the problem becomes how do you know where price is in it's "trend". The easiest way I know of is to measure the price against a reasonably long moving average. In the example below I've plotted a 48 day simple moving average and then plotted lines 14% and 28% away from it on either side. Using this method I've created "zones" to use for determining what the proper starting cash % should be. Granted these are more or less guidelines then exact figures but I think they should serve as a decent metric for calculating.

Now the only problem is coding the zone % into the spreadsheet without the use of several columns. Damn thing is too big already...lol.

I'd be interested in your thoughts.

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