A.I.M. Users Bulletin Board

[Adam]

Hi Jack and Toof, I've been trying to pick out the exact signal for buying again. In the spreadsheet there are three values:

Raw Action = PC- stock value
Suggested Action = Raw action with Safe subtracted
Recommended Action = Suggested action with min trade size imposed

I gather from Ocroft's post 35795 that he's using Suggested Action.

As the stock recovers the Recommended Action will first go to zero, then Suggested Action, and lastly Raw Action.

That makes sense to me as well as waiting for Raw Action to return to zero may be waiting too late, and losing out on profitable trades. These are all buy filters that have a double edge sword. Make the filter too strong and you lose good trades. Make it too weak and you make a buy on a small up fluctuation that continues on the way down.

Compared to moving average crossover, the Ocroft method I find more appealing, because it uses our algorithm to generate the filter. With moving average crossovers you have to decide what those two numbers are and you're wondering if you chose those properly. Though I agree the principle is the same.

Adam