Channel Trading

Discussion in 'Technical Analysis' started by ByLoSellHi, Apr 4, 2007.

  1. Serious question:

    Does anyone here trade channel patterns?

    I've noticed that many, many stocks, especially seasonal ones, have a definitive pattern whereby they touch the same approximate lows and same approximate highs at the same times of the year, for the last several years.

    Thank you for edifying me.
  2. jem


    Apparently spyders got quite a few hershey traders channeling 5 minute charts to riches.

    I would think the same method might actually be proftiable on longer term charts.
  3. Well, that's the basic concept, but I was hoping to get some feedback from individuals here, rather than firms, on whether there's any merit to the methodology.
  4. Bring up the daily on NTRI.

    Some people traded it last year (2006) for 4 cycles of 30% each. The hold was about 3 days each time.

    that used up about 12 days of the year.

    You can fill in with other stocks for the rest of the year.

    40 to 60 cycles is common and the cycle yeild is what you are looking at on your charts.

    compounding a normal return 40 to 60 times a year adds up.

    10,000 x (1 +0.3)^4 would be the results for 10,000 dollars of NTRI traded four times. It is over 15,000 dollars total.
  5. The 15,000 is humor.
  6. Okay, I can definitely see NTRI fitting into the category of stocks that intuitively seem to lend themselves to 'channel' type trading (I would assume it's a New Year's resolution type play).

    The oil stocks have fit this pattern this past year, too, and I can see natural gas in the realm.
  7. You will see in the journals the sorting techniques

    The different sorts bring up the channels and the rest is just anticipatory timing.

    Channels seem so cool and I feel that that are a result of the human psychology associated with reading the markets.

    Representing channels using software coding has a short cut; we may bring it up later this year in journal III.

    Right now we are putting effort into getting a terrific platform built first.