Replies to post #3619 on MDA - Market Direction Analysis (MDA)

[pstuartb]

Very interesting chart. Thanks for sharing it. This weekend I want to think about the relationship between it and the chart HM uses on the S&P. Similar, but I want to think about the differences. #msg-589799

[LG]

augieboo: Hey you're getting to be dangerous...gg

Try plotting your newly constructed oscillator using a zero line and points above and below that zero line to help you identify potential predictive turning levels. The place the osc chart directly over the Naz Comp chart aligned of course.

Regards,
LG

[Namiar]

Great work Augie,

A couple observation gives me some ideas. Maybe you too.

1) I notice that achieving a low level (of the Volume thing) usually gets you a COMPQ bounce, but sometimes not. I notice also that when the "volume thing" drops precipitously, you also get a bounce regardless of where on the chart it happens to be. I will try to work this into the spreadsheet model somehow.

2) Try plotting the volume indicator against SOX instead of COMPQ, I suspect that the bounces will be larger.

3) If you could codify a trading strategy from this indicator, would it be ST (1 day to say 5 days) or IT (2 weeks - 8 weeks)??



Warp

[Namiar]

Augie, MM

I prepared a model from the Eureka strategy (21DMA of %Adv / (%Dec-%Unch)):

- 2 Years of data
- Assume the user goes 100% long QQQ whenever the 21DMA achieves -25%. He/she stays long until 21DMA crosses above 0%
-Assume user goes short 100% whenever the 21DMA achieves +25%. Stays short until 21DMA crosses under 0%.

Results:

22% net gain over the 2 year period
Only 4 plays on the long side - 3 were successful
Only 1 short play, which was successful
Portfolio value went -30% at one point before rebounding - not good

Can someone let me know how to post the spreadsheet as a graphic imbedded within this message? And I will do so.




Warp