Here is a recently published FU or "Final Universe" http://www.elitetrader.com/vb/showthread.php?s=&postid=1943173&highlight=final+universe#post1943173
blue rule: Continue to hold if level is maintained. The peaking level is where the herd suports accumulation. as each day begins this is demonstrated on a pro rata basis. Again this is hard for some people to grasp because they want to wait until the end of the day to be sure. As the day proceeds a ratio of present volume divided by the 65 day average volume may be monitored as "unusual volume". does unusual volume maintain the Peaking cummulative volume ratio? If it does not, then in a while price is going to peak and begin to go flat then begin to return to the MLR line (which is ipped up for the Universe stocks). This type exit is dictated in PVT by the fish frying rule not on the sheet. As MADA skills increase, the trader goes from first gear to second gear to third gear. .... (Did you see McClaren dropped the BMW v12??) Ughly.... As any held stock has a diminished performance compared to its contemporaries, the contemporaries on the rise in money velocity rise above the held stock on the sorted (by unusual volume) lists. Keeping the Universe AND the hot list side by side shows these things. This is called cross over trading and runs the annual turns to 100 quite easily. Now at this point it may be seen that stocks cycle and during the cycle when important volume leads price. Accumulation plays a role in this as has been seen.
To anwser the the if..then statement: "if PVT can't be automated, then PVT is not a system" The result is that PVT is a system. For those who wish to use PVT manually and/or mechanically, they can do that as well. The sheet posted is deigned to be an aid to anyone who wishes to use the P, V relationship with high beta quality stocks to earn high velocity capital acquisitions. Risk minimization is part of gaining experience, which in turn gives knowledge (know how) and skills. The Universe minimizes risk by using repeatable high quality stocks that have natural ccycles of 20% or more per turn. By using a leading indicator of price, risk is minimized. By having a mechanical sorting system during the RTH, it is easier to have the creme rise to the top of the lists. At the end of the day, two lines can be easily drawn to divide the printed lists into the three categories of DU, FRV and Peaking. QED.
Vikana, could we establish some ground rules please? For example, things like it should be the responsibility of the poster, not anyone else, to provide code or simple, code-like statements for their concept. Could we also stick to EOD data and U.S. stocks for simplicity? Thanks.
Maybe we could start with something very simple like the price, volume relationship? Jack's said it's at the heart of TA so surely he can provide simple code or code-like statements that will backtest favorably and illustrate its basic tenets...
Price Volume Analysis is a theory in which concepts from it can be converted into a discretionary trading plan or a coded trading plan. Simply, there are hundreds of different methods derived from Price Volume Analysis... Some profitable and some not profitable depending upon other concepts it's combined with. Therefore, can you be clear about what you are requesting because it seems like you are asking Jack to provide a code of any Price Volume Analysis concept that has not been combined with his own personal trading concepts to produce his trading method. If such is your request...you are trying to test his knowledge of Price Volume Analysis and not trying to test his actual method derived from such... Correct ??? Further, if something cannot be coded does not imply it cannot be profitably traded. It implies you need to find another way of testing the merits of someone's trading approach or knowledge of the Price Volume Analysis when they or you cannot code their method or you cannot code their knowledge (see dbphonenix old threads on Price Volume Analysis). Thus, is Jack using an automated method so that we can understand the requests for access to his coded system. However, if Jack is not using an automated method...then requests for an automated system or code is unreasonable. Yet, it may seem like you guys are requesting a simple explanation of his method so that you can code it yourself for testing. If so, what verification will be provided to show that your interpretation of his knowledge or method correlates with a computer code especially when you are already on record here at ET for personally attacking Jack & Gang along with questioning the merits of the method. Just asking considering this threads seems confusing about Jack's part and those making requests. Mark
NihabaAshi (Mark), here's where I'm coming from. As we all know, there's been a lot of controversy on ET and elsewhere about Jack Hershey's methods. I've tried to shed light on the debate by backtesting those parts of Jack's stuff that I felt were described clearly enough to test... mostly rockets and the 0 to 7 turn of the price, volume relationship as described in Jack's paper, Catch Up With Tomorrow's Prices Today. With respect to this thread... I don't feel Jack is facilitating the backtesting of PVT. So I suggested that we first take on something of Jack's that's related but much simpler... the price, volume relationship that Jack described in his paper. I've done backtests of buying the "0 to 7 turn" using Spydertrader's code for the scoring and concluded that it doesn't give an edge as is. Of course, Jack and his people have said my analysis is flawed so I thought it would be interesting to explore this in more detail quantitatively. I'm prepared to lead by example and cover some simple truths about the price, volume relationship that I'd support with simple but comprehensive backtests and analysis that anyone can replicate. These truths are simple and test out favorably over multiple parameters on large numbers of stocks under all market conditions. Is that too offtopic?
Trading is a bit hectic today, so i'll spend time on this after the close. Here are my thoughts: I'd like the initial focus to be clarification of all details in JH PVT system. Definition of all terms (in a mathematical sense), definition of all rules etc. Jack started addressing my questions so I think it would be reasonable to focus on that. I have no issue with disagreement, but let's leave the past alone. I'd prefer that we simply focus our energies on constructively deciphering the concept and system. Since PVT apparently is fairly simple, it would seem as if everything can be captured over a few days.