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Re: CerealBox post# 2017

Tuesday, 07/07/2009 2:27:31 PM

Tuesday, July 07, 2009 2:27:31 PM

Post# of 16651
I dont use bollinger. They are sitting pretty in my chart, but i forget to check em :)

Volume, moving averages 20 50 100 200, macd, adx, rsi, stochastics

Understand that oscilators are NOT usefull in trending situations.
When ADX is below 30 you can use range indicators (macd histogram, stochastics, rsi oversold condition
When adx moves up higher it means stock is trending, that will give all kinds of wierd signals when you use range indicators.

READ http://rapidshare.com/files/163396934/Technical_Analysis_of_Stock_Trends-8th__20Edition_By_Edwards_AND_Magee.rar

That book is god

really learn all the formulas for the indicators such as stochastics, macd etc. I dont mean that you should understand how to use em, I mean that you know letter per letter the formulas.
Think about what kind of price action has which effect on what part of which indicator.

And really really really do some reading into Pump and Dump. Check the patterns ESPECIALLY the patterns in the moving averages and how the distance between those MA's affects volatility.

It will seem as if when the MA's are spread out alot that the price will jump up and down to gather the moving averages. Once they are gathered it will wait for support (for instance 200ma rising from below). When the resistance comes falling down (for instance 200 ma) price will be pushed below some important support, that will scare people out and volume is created. At some point the price will crawl above quicker moving averages and those averages will push it over the 200 for a nice run.

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