Monday, November 27, 2006
I have previously stated that charts are great but you should pick stocks that have reasonable business fundamentals. FCEL is lacking in this area and has registered a string of losses over prior quarters. This could be a time when I am proving the rule rather than finding an exception to it. We'll keep watching but I am already losing confidence.
Saturday, November 25, 2006
Tuesday, November 21, 2006
Friday, November 17, 2006
To make it interesting, I did put a few dollars on this one though a bit later than the date the system indicated. I consider this signal to be "decent" because the peak is kind of sloppy at the bottom which also causes my Signal-to-Noise indicator to be a bit weak. In any case, if you had bought when the signal indicated (at $1.69 on 8/24/06), you'd be sitting on a 20% profit today, two and a half months after entering the trade.
I'll provide more information on the confirming signal statistics in later posts.
Thursday, November 16, 2006
I am a middle aged guy who has been trading stocks for more than 20 years with various degrees of success. I have an engineering degree and an MBA so I have an interesting mix of the technical and the economic in my background.
Years ago I was fooling around with Visual Basic (a programming language now somewhat obsolete) and trying to develop a good application for tracking my trades and doing charting. This was way before much of this functionality became available via the web for free. As part of the charting exercise, I began to run stock prices through various kinds of equations to see what the charts might look like. (For those of you who like the math details, I just considered the closing prices as simple time-series data and wrote code to process the series using different kinds of functions that might commonly be found in a college calculus text book).
I stumbled upon two functions that seem to provide signals whenever there is a reversal in the direction of prices. One could be used as a Buy signal, the other as a Sell signal.
I used the system with some success until the Internet bubble. During that time, stock prices swung so wildly I often found myself getting stopped out of trades only to see the same stock shoot up 20% the next day. Yes, I did my share of rapid-fire trading of fly-by-night Internet stocks. I was involved in building and consulting on web sites at the time so I was constantly immersed in the ‘net and had definitely drunk the cool-aid. In any case, the volatility of stocks in those days killed the system.
I recently resurrected the code for this application and have done a few refinements. With the markets a bit calmer these days, I have been looking to apply the system; however, there are outstanding questions, testing and evaluations to be done.
I decided to start this blog in order to share my progress in refining the system and perhaps enlist the support of like-minded folks in the Internet community to help refine the process.
For example, is this system appropriate for all kinds of asset classes? Should it be limited to indexes or ETFs? Small caps or large-caps? I believe the system does not work for day trading or swing trading (the time periods are not long enough) but then I haven’t tested either approach, so who knows? Is there a feature that is missing that is important to you?
So, is this “amazing” software available? Just about. I am in the process of doing a major overhaul so it might be a little while before the program is ready. I am getting rid of all the extraneous stuff that can be found elsewhere on the web so the program will be more straight-forward to use and maintain. But for now, I wanted to establish my blog and begin keeping anyone who is interested up to date on progress. And maybe we can begin a dialog around the concepts and how we might take the system to the next level. If you would like a beta version of the software, send me an email (firstname.lastname@example.org) and I will bundle it up and send it off to you.
My time is limited so I will tell you right now I will probably be posting only once or twice a week. Stay tuned. Feel free to subscribe to my RSS feed so you will know when updates to the system are available for downloading or when I have posted a stock pick or trade update.
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