northchuck1, I think you're on to something. i'm going to review what you wrote and look at some charts and get back to you. Attached is my drill for today.
nc1, I believe a change in sentiment refers to an A to D or D to A conversion only, as outlined in the original description of the stochastic indicator. This discussion (see attachment) might prove useful. lj
northchuck1, there's an example from today boxed in white that I think fits your description. This scenario is problematic for me all the time. Thanks to some advice recently, I think looking at the context can help as Tums suggested. Following Spyder's teachings about the 20 sma (which acts as a trend line when volume is at normal levels) might provide a clue. In the highlighted example we see the 20 sma meeting our RTL as the non-dom approaches. We then see the dominant red volume return with a close below the RTL and the 20 SMA (also there's an FBO of both the RTL and the 20 SMA). Watching for areas where the RTL meets the 20 SMA with price advancing in the dominant direction on dominant volume could be one sequence we use to get back on the right side of things. I'm sure there's more info we could get from other tools. Like you, I'm eager to learn more about the MACD in these situations. If it's unclear, I've taped MACD at the values of +/- .4 and +/- 1.
By the way, as far as timing goes I do not know exactly when to reverse. It looks like 50 crosses back to back will require washes a lot of the time. Can someone explain "the shadow" of the STOCH a little more? Another area of difficulty for me is seeing the fast STOCH flapping back and forth on both sides of the 50 line on some bars. How do we deal with that? Thanks!
Here are the formulae for the Fast, Slow and Full stochs courtesy of stockcharts.com. The "shadow" is the H -L thingy. Again, stochs are, for some, an adjunct to JHT. If you don't completely understand PV/Jokari, you will get slaughtered just using stochs. lj
Thanks! And absolutely. The goal is to integrate it all into KISS. This is something to take along with me tonight as reading material because things can get dull. lol
I guess the 20 sma, FBO of the RTL, and increasing red volume give you a clue it's time to reverse. The stochs just help with the anticipation. I've also been going through the older Hershey stoch thread. Pretty informative. With the MACD at .4, you're obviously in a low volatility situation. And I think I've finally got the iceberg idea down. Got example of that between the 9:30 and 10:30 bars.