Replies to post #2768 on Strategy Central

[GLENO34]

WS, all you have to do on Stockcharts is change the setting to 15,5 and it will be the same as Askresearch...I think..

[Vestor_2000]

Thank you so much for the informative response, WS; most appreciated. Anything you can share would be greatly appreciated, but please don't go crazy, either. I have you marked down as a "Favorite," so I will be sure to review all of your posts to understand your thought process and methodology.

Very interesting comment re the Stochastics and the differences between your service and Stockcharts; that really surprises me and I wonder how that can be.

You also made some additional comments that caught my attention, namely your trading within retirement accounts. Coincidently, on Monday I will be rolling over my 401(k) from my former employer to TD Ameritrade, just so I have more flexibility and trading options. Of course, I will have to exercise more judgment than ever before, as I don't want to be caught dead trying some speculative trade like 100,000 shares of Lucent or Nortel!

Thanks again for your interest and your help. Take care.

Rich

[Vestor_2000]

Full Stochastics

Hello again, WS. I would appreciate your assessment of my comments below, based on the 15-5-5 daily stochastics setting, if you wouldn't mind, using this chart:

http://stockcharts.com/h-sc/ui?s=$SPX&p=D&yr=1&mn=0&dy=0&id=p55672163311

If I understand correctly, you trade the crossovers on the FS. If this is the case, and assuming you were trading the S&P 500 (which you may not), you would sell based on Friday's close right? More importantly, we are seeing some negative-divergence between the price action and the Stochastics, which would further reinforce the sell signal.

Also, the signals do look quick, based on your comments and a casual eyeballing. What's more, the signal seems so quick that it seems to overcome the fact that the Stochastics, which usually fail in a trending market, still give good signals. Would this be an accurate statement? Or, what other things do you look at when the market is trending strongly, which may in turn minimize the effectiveness of the Stochastics?

To continue, it looks like good buy signals are given when the S&P 500 is below its 50-day EMA and the Stochastics tags about 15. Likewise, good buy signals are given when the index is above its moving average and the Stochastics touch 20. In both cases, good sell signals appear to be given either when both lines cross above 80-85 or the aforementioned crossover takes place.

I'm sure I will have a few more comments/questions as I look at this setting more, but thanks for offering it for my consideration.

Rich