Monday, November 27, 2006

Follow-up on FCEL after a bad Monday in the stock markets

As I said in my previous post, it would be prudent to watch this stock for a few days. Well, it sure got hammered today as the entire stock market had its worst day in months. Caught in the down draft, FCEL moved in the wrong direction and the TradeRadar signal didn't get to a level that provided any confidence in going long.

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

New Buy Signal - Fuel Cell Energy Inc. (FCEL)

Doing a little post-Thanksgiving stock hunting and I came across this one at Bernie Schaeffer's site. It's getting some high call option activity and the TradeRadar buy signal looks pretty good (just beginning to signal a buy on 11/20/06 at $7.05). This trade is playing out right now; this is not a back-test. Buying it anytime within the last week or when the market opens Monday would be the agressive approach. Waiting a bit to see how things look over the next few days or so might be more prudent. Note that the red signal line is just barely below the green trigger point. Seeing that signal go a little lower would provide more confidence. Let's keep an eye on this one.



Tuesday, November 21, 2006

Eight by Eight (EGHT) - one more example of a historical trade

Here is another stock that I actually spent money on. The signal was given by the TradeRadar system around 8/18/2006 at less than a buck. The stock is currently closing in on $2 a share as we approach Thanksgiving. It has nearly doubled in three months. I have been testing the refurbished TradeRadar system on some volatile, inexpensive small caps and this one is working out pretty well. Note that the stock itself has a certain fundamental interest. It is involved in providing low cost VOIP services to small and medium size businesses. VOIP is a trend that is accelerating. My own opinion is that charts are great but the underlying stock should still have a good story and solid business potential. The company's products are now being handled by a major office products chain and the stock is beginning to move to the upside.



Friday, November 17, 2006

Generex (GNBT) - decent buy signal

Here is a view of what the system looks like. Note the red peak in the lower chart. This indicates that a low has been hit. The horizontal green line intersects the red peak. Where it intersects on the right side of the peak (the trailing edge, as the engineers would say), we have a Buy signal. This Buy signal is clearly earlier than that provided by the 20-day EMA moving above the 50-day EMA, for example. That is the benefit this system attempts to provide, an earlier signal that is still reliable.

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

Start this up - my first blog, my first post

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 (traderadar@yahoo.com) 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.







Disclaimer: This site may include market analysis. All ideas, opinions, and/or forecasts, expressed or implied herein, are for informational purposes only and should not be construed as a recommendation to invest, trade, and/or speculate in the markets. Any investments, trades, and/or speculations made in light of the ideas, opinions, and/or forecasts, expressed or implied herein, are committed at your own risk, financial or otherwise.




 
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