Short terms settings for Indicators?

Discussion in 'Technical Analysis' started by Bladen, May 27, 2004.

  1. Bladen


    What settings do you use for Indicators such as ADX and slow stochastic for swing trading (5 - 10 day)?? Ive heard 12,3,3 for stoch but that doesnt seem right.
  2. lindq


    A 10 period RawK works for me in helping to pick bottoms. I don't bother with fast or slow D.

    Example: Look at a 10 day RawK against a daily S&P. You'll see obvious buying opportunities.
  3. The considerations for setting defaults are:

    1. The nature of contemporary trading.

    A paticularly important change occured with the advent of the PC. Another change occured when data sets offered changed. Another change occured when bandwidth was increased.

    Thus, at this point, all designer original defaults are passe.

    2. The universe you choose to trade.

    Most people chose universes to achieve three primary goals: repeatability, volatility, high quality performance. These items affect the defaults on your selected indicators.

    3. The common cycle rate among the candidates in your universe.

    You are currently "bridging" by your two contradictive choices. The universe you choose more or less dictates your optimum money velocity of profits appreciation. Most people cannot intuit the effects of theuniverse criteria selections and emphasis. Thus he common cycle rate becomes very important.

    4. The class the indicator fits into among: absolute or relatavistic.

    The defaults on each of these classes must be determined independantly and independantly within the class as well.

    5. The efficiency of the basic approach for extracting profits.

    It is not always possible to extract all the money offered to you. After you consider separate ways the maximizing this and minimizing that, you get to optimization by considering the interrelationships of the whole set of operators. This affects the indicators signals you make use of. To align these most effectively for getting results you have two levels of "tuning". First on your trading fractal and then on the anticiaptory fractals that "lead" the trading fractal. Optimally the defualt are common to all fractals. This takes time to achieve.

    Once you get to having an approach for making money, a lot of the descriptors for setting up the monitoring basis fall into place.

    As yet, it is impossible to designate the various fractals that could be used to monitor from what you say to us.

    As a minor consideration, there is always a very long term transient in the market system mostly caused by trader influences changing over time.