Hershey's Equity thread

Jack,

What could the 30 minute chart potentially "tell" you? What are the things that you're thinking about when you're monitoring the stocks on the 30 minute?

Do you receive the most benefit from the 30 minute, before you open the position or after you open the position?


Thanks,
gotta_trade

 

Jack,

How does the MACD fit into this process?

Thanks,
gotta_trade

 

Don't use the absolute float as a criterion. Divide it by a 10-day volume average to get the percentage of float that is being traded. I look for an acceleration in this "float percentage" number to identify stocks that are appropriate for momentum trading systems. Set a minimum threshold to distinguish between the mo and what I call the no-mo, as in no mo trading. By tracking this number, you'll be able to trade some of the very high-volume large caps effectively. If one uses TradeStation, then just set up a RadarScreen window with this indicator (use ROC to detect acceleration) and sort in descending order. The high percentages are the ones to trade.

 

I have attached a chart summarizing Jack's binary scoring for those with interest. When Jack speaks to the relationship of P, V and A/D he determines the binary score (0 or 1) for price, volume and accumulation / distribution. Using the following formula:

(P x 2²) + (V x 2¹) + (A/D x 2°) = Score

or, simplified:

(P x 4) + (V x 2) + (A/D x 1) = Score

The scores represent locations on the following price chart:

sell >> 4 /\ 3
/ \
5 / \ 2
/ \
1 \ 6 / \ 1
\ /
0 \ 7/ <<< buy
\/

Further insight into Jack's methods (and a far superior chart than above) can be found at the following web site:

http://sputnick5.www8.50megs.com/

The chart located at the above site graphically defines Dry Up and First Rising Volume.

I recommend "Tomorrow's Paper," "The Big Post" and "System Glossary" to begin with. Additional web sites containing archives of Jack's teachings are located here:

http://mycoolstars.hypermart.net/

http://groups.msn.com/ShortTermStockTrading/home

I have repeatedly searched the Google archives to locate the "maths" Jack describes as boolean algorithmic equations for version three of his software. I have yet to locate these. If anyone has located these equations, I would greatly appreciate a copy and would pay for shipping if required.

I hope the above helps clarify rather than confuse.

- Spydertrader

 

The above chart didn't post as hoped. Attached is a screen shot of Jack's chart.

 

Watching the volume for the hot list selections, I note that they all, with the exception of LAVA, typically print daily volumes exceeding their respective DU levels (as calculated by Jack. LAVA exceeds it usually.). This raises another question: How does one apply DU during the monitoring? One goes on a DU watch? If so, the DU watch is valid as is until the next update to the 100 stock database and retabulation? This is the same question izeickl came up with, and I did read your reply to his question, but your reply didn't satisfy, as you told him to make a 'best guess' 'cause things change.

izeickl, did you get what you were looking for in the way of answer? If so, mind sharing it with me?