How do yo upredetermine if a market will be choppy?

Discussion in 'Technical Analysis' started by chiefraven, May 11, 2007.

  1. Hi,

    does anyone know of any tools or indicators that helps determine the choppiness and volatility of the market other than by using the volatility index? since the volatility index is pretty much the opposite of the index chart like dow jones and spy.

    I really wanna find something i can use to gauge the market so i know whether the market is too volatile (going up and down and up and down) and whether or not i should ease the throttle a little. For example, during thursday's market, i just did horrible, i would short, and then the market will bounce up a tiny bit and i would get hurt, and if i take stocks long, the stocks just sits there and the market continues to drop and i would get hurt....

    i have been doing really well in more stable market, like when the market is gradually going up or down, as well as when the market just goes completely sideway... but i need something to help me determine when i should be more careful of the market.

    if anyone has any advice, i would love to hear them :D
  2. Choppiness indicator. QuoteTracker has it but I've never seen it anywhere else.

    edit - obviously it's a lagging indicator so it doesn't tell you how choppy the market is going to be.
  3. If you set up a number of different length MACD indicators and volatility bands it will help you to see when prices are accelerating or losing steam or approaching support and resistance.

    I use this setup to scalp Crude. It helps me to assess when not to fade a move.