Sunday, January 24, 2010

Charts of Charts with some explanations

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For aggressive traders, the Chart of Charts called this downturn last Friday.   For conservative traders, the 20DMA is still at 2, a neutral range...signaling don't go bear quite yet.  There could be a bounce next week, that would be expected, which is why we should also expect the opposite...a continued plunge.  Sunday futures may indicate whether the Pres and his "advisers" still want to pump taxpayer money into the future to ramp them up.

New feature in the Chart of Charts

Green Arrows Mark the 20DMA Crossover.  Trading the 20 DMA is "Safe"--Any drawdowns are minimal and good percentage of trends are captured.  I have seen annual returns between 20% and 30% following the 20DMA. 

Existing Features of Chart of Charts

Heat Map--A custom indicator that adds "feel" to the root data of number of bearish charts and number of bullish charts.   It uses some back-tested weighting factors that change based on various breakpoints.   These were all back-tested to produce highest returns.  Red is bear, Blue is bull, Amber is neutral.

Scatter Chart -- Shows the total number of broken out chart counts.  Extremely low numbers portend an upcoming big change, similar to low movements in the NYSE McClellan Oscillator.   This chart looks cool, but is not a "Prime Indicator".  Perhaps next week I add a moving average to the scatter chart.   Maybe an oscillation period will be noticed, and perhaps coordinate with other timing based cycle approaches to stocks.

5, 10, and 20 Day Moving Average DMA.  The 5 and 20 DMA are charted.  The 20 DMA is near the top, and the 5 DMA is at the bottom.   The custom "Toggle Chart" which is at the middle, and composed of thick Blue, Orange and Purple lines depicts CROSSOVERS of the 5,10,20 DMA from bullish to bearish and vice-versa

Link to prior Chart of Charts -- I will say this though, although I was giving EWI a hard time about getting gamed, and they did get gamed and get their stops blown out....they came back resolutely on the 21st, Thursday, with another call to be highly leveraged short....they got gamed on Monday, but they didn't get scared off.

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