What I've found useful (or not)

Discussion in 'Technical Analysis' started by hoo_doo_one, Jun 2, 2006.

  1. Well, here it is. I was sworn to secrecy on some of this for some reason, but I have yet to see why.

    In the last few years I've written several automated strategies and quite a few indicators. In the end, I've made $, lost $, made $, etc....

    Here's some of the things that I've found useful along with some things I've found not useful. See the screen shots for clarity:

    M's and W's tagging bollinger bands and giving a divergence in RSI. This seems to work well when the market is moving sideways, but if the market is trending up or down all day then you're going to throw $ in the toilet all day.

    Plotting a Moving average for a long time period on top of a shorter time period chart. For example, you would plot a 10 period daily MA on a 45 minute chart. When price crosses up, you go long and vice versa for a short. This worked so well that I decided to try it out on 5 minute charts. It took 3 days of high volatility + sideways movement for me to get my butt handed to me. Never the less, I still employ this technique.... On a longer timeframe of course.

    Next up; Hurst/ Bressert/ Clyde Lee/ Time cycles. I found a cycle oscillator that works very well. This oscillator is based on the swingleeII function by Clyde Lee. Jan Arp, and Walter Bressert have similar oscillators for sale.

    I've been using the oscillator in conjunction with the MA technique mentioned earlier. If price is above the MA then I only take long trades. If price is below the MA then I only take short trades. This works ok but I've gotten spanked a couple of times trading gold.

    Last but not least, Hurst channels. I've found these to be absolutely USELESS! That being said, it hasn't stopped me from obsessing with them. I've been looking for a way to validate the channel signals along with the cycle oscillator and the MA. In other words, if price is above the MA, touches the channels, and the oscillator turns up, then you would go long.

    Here are a few others I've tried:
    Keltner channels: I've found no use in these
    Candlesticks: They look pretty, but I have found nothing useful
    Jurik MA's: I like the stochastic and MACD stuff but I like the cycle oscillator better.
    Gann Fann: excellent, but requires too much manual labor to be used in an automated strategy.

    I don't really know where I'm going with this so I'll wrap it up now.

    Any comments?

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  2. Here's the MA.
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  3. Here's the cycle oscillator
  4. Here's the Hurst Poly channels
  5. Trapper



    Is your oscillator a double stochastic? Also, have you checked out Clayburg's work.

    Best regards,

  6. Hi Trapper,

    Yes, this oscillator is like the Bressert Double stochastic, but someone added a smoothing function. It's also very similar to the Jan Arp Swing Hi/Lo oscillator.

    I haven't checked out the Clayburg stuff, but I will now. Thanks!

  7. nbates


    If you're doing it by hand and trying to TA(nalyze) with charts, you may as hang it up...all that stuff is sold like the holy grail, but the real money is in perpetuating the myth.

  8. Finally the very first step has just begun.
  9. So where does one go from here?

  10. I'm not saying this to insult you in anyway, but you're making things a lot more complicated than you need to.

    Take your chart to a child. Ask him/her if it's going up or down. Whatever they say is the major trend of the move and you should take that position on reasonable size to allow for some chop. Put in your stop loss too.

    The thing I'm illustrating is that trading is simple. You're making it more complicated than it needs to be. Trend following is not sexy. It's not going to get you to buy the bottom or short the top. It's nothing sophisticated that you can brag about to boost your ego at a cocktail party. But it will make you money if that's what you're after.
    #10     Jun 2, 2006