Czy triple screen trading system work

System handlu trzema ekranami - Część 7 System handlu potrójnego ekranu można zilustrować metaforą oceanu. Pierwszy ekran systemu handlu potrójnego ekranu ma długoterminową perspektywę i ilustruje rynkową falę. Drugi ekran, reprezentowany przez oscylator. identyfikuje falę średnioterminową, która idzie wbrew przypływowi. Trzeci ekran poprawia system do jego najkrótszej miary, identyfikując fale, które poruszają się w kierunku przypływu. Są to krótkoterminowe zmiany cen śróddziennych, które określają punkty wejścia dla zamówień kupna lub sprzedaży w ciągu dnia handlowego. Jeśli potrzebujesz odświeżenia, sprawdź Triple Screen Trading System - Part 1. Część 2 i część 3. Na szczęście dla tych z nas, którzy znużą się interpretowaniem wykresów lub wskaźników technicznych na pierwszym i drugim ekranie, trzeci ekran nie wymaga dodatkowego talentu technicznego. Zamiast tego trzeci ekran udostępnia technikę składania zleceń stop. albo kupuj zlecenia stop, albo sprzedaj zlecenia stop, w zależności od tego, czy pierwszy i drugi ekran kupują lub sprzedają krótko. Mówiąc dokładniej, trzeci ekran nazywany jest techniką trailing buy stop w trendach wzrostowych i techniką końca stop sprzedaży w trendach spadkowych. Gdy trend tygodniowy wzrośnie (identyfikowany przez pierwszy ekran), a dzienna tendencja spadnie (identyfikowana przez drugi ekran lub oscylator), umieszczenie ciągłego kupowania zatrzyma wypady w górę. Gdy tygodniowy trend spadnie, a trend dzienny wzrośnie, wyprzedaże sprzedaży powstrzymają przełamanie dolegliwości. Każda sytuacja zasługuje na dalszą analizę. Trailing Buy Stop Technique Kiedy odkryjesz, że trend długoterminowy (tygodniowy) rośnie, a średnioterminowy (dzienny) oscylator zmniejsza się, system handlu potrójnego ekranu aktywuje technikę ciągłego kupowania. Aby wprowadzić technikę ciągłego kupowania, umieść zlecenie kupna, zaznaczając je powyżej najwyższego dnia poprzedniego. Następnie, jeśli nastąpi wzrost cen, zostaniesz automatycznie zatrzymany na pozycji długiej, gdy wiec przekroczy najwyższe z poprzednich dni. Jeśli jednak ceny będą nadal spadać, zamówienie kupującego stop nie zostanie dotknięte. Technika ta pozwala na zatrzymanie się w twoim porządku, jeśli najkrótsze fale mają wystarczającą siłę, by zasilić falę w większą falę. Przystanek kupna jest zatem najbardziej zbliżony do tego, co większość handlowców określiłaby mianem inwestowania dynamicznego. Jednak użycie wszystkich trzech ekranów w systemie handlu potrójnego ekranu zapewnia o wiele bardziej szczegółowy i dopracowany obraz rynku, niż na ogół zapewnia prosta koncepcja rozpędu. Więcej informacji na ten temat można znaleźć w części Wprowadzenie do transakcji Momentum. Jeśli chcesz dopracować technikę końcowego kupowania, możesz obniżyć kolejność zakupów następnego dnia do poziomu pierwszego pasku powyżej najnowszego paska cen. Obniż dzienny limit kupna, aż do momentu, w którym przestaniesz (wypełniając zamówienie w najlepszym momencie) lub do momentu, gdy wskaźnik długoterminowy (cotygodniowy) się odwróci i anuluje sygnał kupna (oszczędzając ci straty). Powód, dla którego technika kupowania z wyprzedzeniem poprzedza kwalifikację końcową, dotyczy tej płynnej natury zlecenia kupowania kupującego. Musisz jednak zachować czujność w monitorowaniu dynamiki rynku. i musisz być sumienny w ciągłym przemieszczaniu kupującego stopu do jednego tiku powyżej najnowszego paska cen. Proces ten może być pracochłonny, ale zapewni wypełnienie zamówienia po najlepszej cenie lub uniknie złego handlu, jeśli rynek nie ruszy się z miejsca. Trailing Sell Stop Technique Odwrotna sytuacja ma miejsce, gdy twój długoterminowy (tygodniowy) trend spadnie, w którym to czasie będziesz czekać na wiec w swoim średnioterminowym wskaźniku (oscylatorze), aby aktywować technikę stopu sprzedania na końcu. W technice końcowej sprzedaży stopu. składasz zamówienie, aby sprzedać krótką jedną kreskę poniżej najniższego ostatniego słupka. Kiedy rynek zostanie odrzucony, automatycznie zostaniesz zatrzymany w swoim krótkim handlu. Jeśli jednak rynek nadal będzie się gromadził. możesz codziennie podnosić zlecenie sprzedaży. W przeciwieństwie do techniki trailing buy stop, technika zatrzymania sprzedaży z tyłu ma na celu złagodzenie przełomu w ciągu dnia od codziennego trendu wzrostowego. Jak widać, przełom w dół śróddzienny przesuwa się w kierunku rynkowej fali, która w tym przypadku jest cotygodniowym trendem spadkowym. Techniki zatrzymywania kupowania za opcją kupna i wyprzedawania z wyprzedaży są ostatecznymi ulepszeniami tego, co już jest niezwykle potężnym systemem handlu na pierwszych dwóch ekranach trzech ekranów. Korzystając z mniej rozwiniętego wskaźnika, wielu początkujących handlowców zaangażuje się w system ciągłego wstrzymywania zamówień, gdy będą próbować zmierzyć dynamikę rynku. Korzystając najpierw z wykresu długoterminowego i oscylatora średniookresowego, możesz wykorzystać krótkoterminowe fale rynkowe, gdy dokonujesz najlepszych transakcji, które pozwalają na to w ciągu dnia. Następna sekcja z tej serii zamknie system handlu potrójnego ekranu. Podróż przez wszystkie trzy ekrany była długa, ale wynik jest zdecydowanie wart uwagi. Jeśli jesteś w stanie w pełni wdrożyć system handlu potrójnego ekranu, jesteś na najlepszej drodze do wyprzedzenia wielu innych handlowców, z którymi konkurujesz o zyski Aby dowiedzieć się, w jaki sposób system handlu potrójnego ekranu faktycznie pomaga przedsiębiorcy w uzyskaniu zysku i uniknąć znacznych strat, przejdź do Triple Trading Systems - Część 8. Frexit krótko dla quotFrench exitquot to francuski spinoff terminu Brexit, który pojawił się, gdy Wielka Brytania głosowała. Zlecenie złożone z brokerem, który łączy w sobie funkcje zlecenia stopu z zleceniami limitów. Zlecenie stop-limit będzie. Runda finansowania, w ramach której inwestorzy nabywają akcje od spółki o niższej wycenie niż wycena na rzecz spółki. Ekonomiczna teoria łącznych wydatków w gospodarce i jej wpływ na produkcję i inflację. Rozwinęła się ekonomia keynesowska. Posiadanie aktywów w portfelu. Inwestycja portfelowa jest dokonywana z oczekiwaniem uzyskania zysku z tego tytułu. To. Współczynnik opracowany przez Jacka Treynora, który mierzy zwroty zarobione powyżej tego, co można było zarobić na ryzyku. Jak prawidłowo używać prostych średnich kroczących dla rynku czasowego Jednym z największych wyzwań stojących przed inwestorami jest ustalenie, kiedy nadszedł właściwy czas. kup lub sprzedaj akcje. Większość regularnych inwestorów nie dysponuje zaawansowanymi narzędziami analizy technicznej (TA), aby pomóc im w określeniu stanu technicznego ulubionych towarów. Nawet jeśli narzędzia takie jak Metastock. Quotetracker lub eSignal są dostępne, sama liczba i złożoność niektórych dostępnych wskaźników analizy technicznej ostatecznie prowadzi do jakiejś formy paraliżu analitycznego. Rezultat końcowy, nic dziwnego, że inwestorzy rozpraszają się od głównego celu, jakim jest znalezienie optymalnego punktu wyjścia do zakupu lub sprzedaży akcji. Wprowadzenie prostego systemu identyfikacji trendów giełdowych To, co zaraz przedstawimy, to adaptacja jednego z najbardziej efektywnych systemów transakcyjnych, po raz pierwszy ujawnionego przez dr Alexandra Eldera (autora Trading for a Living), zwanego Triple Screen Trading System. Nasz dostosowany system użyje prostych średnich kroczących (SMA) w ramach systemu Triple Screen Trading System, w porównaniu do oryginału, który opiera się na jednym z poniższych: Stochastics. MACD lub RSI. Całą przesłanką tego systemu nie jest poleganie na pojedynczym wskaźniku, ponieważ żaden pojedynczy wskaźnik nie może być cały czas skuteczny. Korzystanie z wielu odmian wskaźnika np. różne ramy czasowe lub okresy, pomogą stworzyć bardziej solidną i niezawodną metodologię transakcyjną. Jak złagodzić opóźnienie w średnich ruchomych Proste średnie ruchome (SMA) to jedne z najpopularniejszych i najczęściej stosowanych wskaźników technicznych używanych zarówno przez profesjonalnych, jak i początkujących traderów. Średnie kroczące są ogólnie znane jako wskaźniki opóźniające i jakoś wydaje się, że słowo proste w SMA ma negatywne konotacje, ponieważ wielu uważa, że ​​handel nigdy nie może być prosty. Prawdą jest, że SMA są opóźnione, ale nie musi to być ograniczenie i można je złagodzić. Odkryjesz, że poprzez użycie wielu SMA, można przezwyciężyć wady, aby utrzymać się po właściwej stronie handlu, przez większość czasu. Weź przykład przedsiębiorcy, który używa tylko SMA 200, by wyrównać czas. Będą przypadki, gdy zapasy zaczną spadać, ale 200 SMA będzie nadal skierowane w górę. Zagadką dla większości przedsiębiorców jest to, czy powinni to robić, ponieważ długoterminowy trend wciąż rośnie, lub sprzedać, ponieważ spadły ceny akcji. To niezwykle wąskie użycie przez wielu sprzedawców jest sposobem, w jaki SMA uzyskują złą reputację. Po prostu dodanie do równania 5 SMA, 20 SMA lub 50 SMA ostrzeże handlarza przed potencjalnym odwróceniem, ponieważ te SMA będą reagować szybciej niż 200 SMA na jakiekolwiek zmiany w cenie. Dlaczego proste średnie ruchome pracują, gdy są prawidłowo stosowane Dotknęliśmy jednej z głównych wad SMA i jak można go złagodzić, a więc jakie są jego zalety. Cóż, fakt, że SMA są tak dobrze znane, że profesjonalni sprzedawcy podłóg, zarządzający funduszami hedgingowymi, a nawet kontrolujący ich buty chłopcy, sprawiają, że te wskaźniki TA są o wiele potężniejsze. Fala kupowania (lub sprzedawania), gdy przeniknięta jest ważna średnia krocząca, w szczególności 200 SMA, jest dowodem jej siły. Czytaj Czy analiza techniczna naprawdę działa, aby zrozumieć mechanizm, dlaczego niektóre wskaźniki techniczne są tak potężne, mimo że wskaźnik na pierwszy rzut oka wydaje się nieodpowiedni do danego zadania. Korzystanie z wielu ramek czasowych MA Dlaczego więc handlowcy często tracą przy korzystaniu z SMA i w końcu rezygnują z tego wskaźnika Większość początkujących handlowców generalnie popełnia błąd polegający na używaniu tylko jednego SMA do podejmowania decyzji handlowych. Tutaj szansa na błąd jest bardzo wysoka. Wystarczy wyobrazić sobie sytuację, w której kupiec kupuje w oparciu o 5 sygnał kupna SMA, ale nie zdaje sobie sprawy, że 200 SMA wskazuje na silny trend zniżkowy. Handlarz może mieć szczęście i zarobić trochę pieniędzy, ale w dłuższej perspektywie przeważy dominujący trend długoterminowy, a handel przeciwny trendom spowoduje stratę inwestora za dużo pieniędzy. Segment BannRonn Trends na naszej stronie internetowej udostępnia wiele SMA zasobów, aby pomóc Ci w podejmowaniu racjonalnych decyzji technicznych w momencie wprowadzania wpisów i wyjść do ulubionych towarów. Oto kilka prostych zasad, o których należy pamiętać przy korzystaniu z tych danych: Zasady wprowadzania do obrotu Zasady trend długoterminowy (200SMA) - Up trend średnioterminowy - w górę Ostateczny punkt wejścia zostanie określony przez 5 SMA lub 20 SMA (w zależności od preferencji). Cierpliwość jest krytyczna w tym momencie. Zaczekaj, aż towar się wycofa, a SMA 5 lub 20 pokazuje trend spadkowy. Następnie wprowadź, gdy 5 lub 20 SMA się obróci i wskaże trend wzrostowy. Punkt zatrzymania powinien znajdować się w miejscu, w którym 50 SMA lub 200 SMA zdecydowanie wykazują tendencję zniżkową, a także w zależności od indywidualnego poziomu komfortu i oceny ryzyka. Dla większego bezpieczeństwa, ale z potencjalnym ryzykiem utraty wielu dobrych transakcji, punkt wejścia może zostać dostrojony tak, aby znajdował się w pobliżu SMA 50 lub 200. W przypadku pozycji krótkich, po prostu odwróć powyższe. Zobacz tabelę po prawej stronie, aby zobaczyć przykład stref kupowania w oparciu o omawiane zasady. Dodatkowe wskazówki dotyczące udanych transakcji Ustaw cel zysku. Wielu inwestorów i inwestorów pozwala na wyparowanie zysków, ponieważ nie czerpią zysków. Jeśli wierzysz, że akcje mają jeszcze wolne miejsce, to przynajmniej skorzystaj z częściowych zysków. Niektóre dobre cele do osiągnięcia zysków obejmują wspieranie obszarów oporności na amp w pobliżu punktów Pivot np. Weekly Pivot, R1, R2, S1, S2. Możesz zobaczyć przykład na stronie wsparcia i oporu dla Apple Inc. Niejednokrotnie, zwinny handlowiec jest w stanie ponownie wejść po znacznie korzystniejszej cenie po wyjściu w pobliżu punktu obrotu. Nie wychodź za mąż za akcje. Istnieją tysiące zapasów w różnych sektorach i branżach. Jeśli zapas nie spełnia Twoich kryteriów, znajdź inny. Jeśli kupisz w magazynie i tak się stanie, że natychmiast zmieni się na południe, ze wszystkimi wskaźnikami również się cofnie, najlepiej będzie obniżyć straty i przejść do następnego celu. Strategia trzeciego ekranu - dr Alexander Elder Członek handlowy Dołączył do maja 2017 3,332 Posty Jest to Strategia Trendu, która wykorzystuje część "Tajemnej" Strategii Dr Alexandra Eldera. Najpierw znajduję na wykresie D1 globalny trend za pomocą wskaźnika MACD. Gdy ogólny trend jest jasny, używam ram czasowych H1, aby działać w tym samym trendzie, stosując wskaźnik procentowy Williams. Po otwarciu pozycji zarządzam wiadomościami ekonomicznymi i podstawowymi analizami, aby zamknąć pozycję, jeśli myślę, że trend ma się odwrócić na wykresie D1. Wspomniana wyżej Strategia Trendu jest wykorzystywana w konfrontacji z Opcją Wsparcia Opcji Cenowej (PASR). Główne obszary wsparcia i oporu można znaleźć za pomocą wykresów tygodniowych i miesięcznych. Ważne jest, aby obserwować działanie ceny (tworzenie się świecy) na tych znaczących poziomach SampR przed wprowadzeniem handlu. Third Screen Strategy EA Ten konkretny EA jest specjalnie zaprojektowany wokół tej strategii. D1 MACD wzmacniacza H1 Williams TYLKO. Dla tej strategii nie stosuje się żadnych EMA. Jeśli masz jakieś pytania dotyczące tego EA, zapoznaj się z dokumentem FAQ na dole tego postu. PIERWSZA Jeśli nie możesz znaleźć tego, czego szukasz, proszę przeczytaj ten cały wątek. PIERWSZY W takim razie, jeśli nadal nie możesz znaleźć odpowiedzi na swoje pytania wtedy możesz poprosić. Obiecuję, że dowiesz się dużo o tej strategii i spotkasz mnóstwo żywych przykładów, które będą zawierać wykresy wspierające tę strategię. Nie chcę tu nikogo nakarmić, mamy nadzieję, że wszyscy odpowiedzialni dorośli. Jeśli nie możesz czytać, to nie handlujesz walutą obcą Khaled, dżentelmen, który zaprogramował tę strategię na doradcę eksperta, spędził dużo czasu, czyniąc tę ​​strategię tak prostą w użyciu, jak to tylko możliwe. Jak już wspomniałem powyżej, jeśli masz jakiekolwiek pytania dotyczące tego EA lub strategii w ogóle, przeczytaj najpierw cały wątek Stop Loss amp Take Profit Parameters (kliknij ten link, aby znaleźć zalecane parametry stop loss weź zysk) Wszelkie pytania w w odniesieniu do Trzeciej Strategii Screenów EA można zadać i odpowiedzieć w wątku Third Strategy Strategy Support. Pomoże nam to utrzymać ten wątek poświęcony obrotowi tą strategią i nie rozpraszać się pytaniami i odpowiedziami doradcy MT4 Expert Advisor. Szczegółowy opis tej strategii handlu Brzmiąc bardziej jak medyczny test diagnostyczny, system handlu potrójnego ekranu został opracowany przez dr Alexandra Eldera już w 1985 roku. Medyczna aluzja nie jest przypadkowa: Dr. Elder pracował przez wiele lat jako psychiatra w Nowy Jork, zanim zaangażuje się w handel finansowy. Od tego czasu napisał dziesiątki artykułów i książek, w tym 8220Trading For A Living 8221 (1993). Mówił także na kilku dużych konferencjach. Wielu handlowców przyjmuje jeden ekran lub wskaźnik, który stosuje się do każdej transakcji. Zasadniczo nie ma nic złego w przyjmowaniu i trzymaniu się jednego wskaźnika do podejmowania decyzji. W rzeczywistości dyscyplina związana z utrzymaniem koncentracji na pojedynczym działaniu jest związana z dyscypliną osobistą, jest to być może jeden z głównych czynników decydujących o osiągnięciu sukcesu jako przedsiębiorcy. (Zobacz, Psychologia handlowa i dyscyplina). Co się stanie, jeśli wybrany przez ciebie wskaźnik będzie w istocie wadliwy? Co się stanie, jeśli warunki na rynku ulegną zmianie, tak, że twój pojedynczy ekran nie będzie mógł już uwzględniać wszystkich ewentualności działających poza jego pomiarem? Chodzi o to, że rynek jest bardzo złożony, nawet najbardziej zaawansowane wskaźniki nie mogą działać przez cały czas i pod każdym warunkiem rynkowym. Na przykład, w tendencji wzrostowej na rynku, wskaźniki trendu rosną i emitują sygnały 8220buy8221, podczas gdy oscylatory sugerują, że rynek jest wykupiony i emituje sygnały 8220sell8221. W trendach spadkowych wskaźniki trendów sugerują, że sprzedają się krótko, ale oscylatory stają się wyprzedane i emitują sygnały do ​​kupienia. Na rynku, który porusza się znacznie wyżej lub niżej, wskaźniki trendu są idealne, ale są podatne na gwałtowne i gwałtowne zmiany, gdy rynki handlują zakresami. W zakresach handlu oscylatory są najlepszym wyborem, ale gdy rynki zaczynają podążać za trendem, oscylatory emitują przedwczesne sygnały. (Aby uzyskać więcej informacji na temat oscylatorów, patrz "Osieilatory" - część 1, część 2, część 3 i część 4.) W celu ustalenia bilansu opinii wskaźnikowej niektórzy handlowcy próbowali uśrednić sygnały kupna i sprzedaży wydane przez różne wskaźniki. Ale do tej praktyki jest nieodłączna wada. Jeśli przy obliczaniu liczby wskaźników następujących po tendencji jest większa niż liczba użytych oscylatorów, wynik będzie naturalnie przekrzywiony w kierunku wyniku trendu i na odwrót. Dr Elder opracował system do zwalczania problemów związanych z prostym uśrednianiem, jednocześnie wykorzystując najlepsze z obu technik: trend-follow i oscylator. System Elders ma na celu przeciwdziałanie niedoborom poszczególnych wskaźników w tym samym czasie, gdy służy do wykrywania nieodłącznej złożoności rynku. Podobnie jak potrójny znacznik ekranowy w naukach medycznych, potrójny system transakcyjny stosuje do każdej decyzji handlowej nie jeden, nie dwa, ale trzy unikalne testy lub ekrany, które stanowią połączenie wskaźników trendu i oscylatorów. (Aby uzyskać więcej informacji na temat wskaźników, zobacz Wskaźniki ekonomiczne dotyczące poznania i handlu psychologią i wskaźnikami technicznymi.) Problem ram czasowych Istnieje jednak inny problem związany z popularnymi wskaźnikami trendu, które należy usunąć, zanim zostaną wykorzystane. Ten sam wskaźnik śledzenia trendu może emitować sygnały kolidujące, gdy są one stosowane w różnych ramach czasowych. Na przykład ten sam wskaźnik może wskazywać na trend wzrostowy w dziennym wykresie i emitować sygnał sprzedaży i wskazywać trend spadkowy na wykresie tygodniowym. Problem powiększa się jeszcze bardziej dzięki wykresom intraday. Na tych wykresach krótkoterminowych wskaźniki trendu mogą zmieniać się między sygnałami kupna i sprzedaży co godzinę lub nawet częściej. W celu rozwiązania tego problemu pomocne jest podzielenie ramek czasowych na jednostki po pięć. Dzieląc miesięczne wykresy na cotygodniowe wykresy, istnieje 4,5 tygodnia do miesiąca. Przechodząc z cotygodniowych wykresów do dziennych wykresów, jest dokładnie pięć dni handlowych w tygodniu. Na kolejnych poziomach, od wykresów dziennych do godzinnych, w handlu przypada od pięciu do sześciu godzin. Dla dziennych inwestorów, wykresy godzinowe można zredukować do wykresów 10-minutowych (mianownik sześciu), a na koniec od wykresów 10-minutowych do wykresów dwuminutowych (mianownik pięciu). Istotą tego pięcioosobowego pojęcia jest to, że decyzje handlowe powinny być analizowane w kontekście co najmniej dwóch ram czasowych. Jeśli wolisz analizować swoje decyzje handlowe za pomocą cotygodniowych wykresów, powinieneś także stosować miesięczne wykresy. Jeśli korzystasz z dziennych transakcji za pomocą wykresów 10-minutowych, najpierw przeanalizuj wykresy godzinowe. Po tym, jak przedsiębiorca zdecydował się na ramy czasowe do zastosowania w systemie potrójnego ekranu, on lub ona określa ten przedział czasu jako przedział czasowy. Długoterminowe ramy czasowe są o jeden rząd pięć razy dłuższe, a ramy krótkoterminowe o jeden rząd razy krótsze. Handlowcy, którzy wykonują swoje transakcje przez kilka dni lub tygodni, będą używać dziennych wykresów jako pośrednich ram czasowych. Ich długoterminowe ramy czasowe będą cotygodniowe wykresy godzinowe wykresy będą ich krótkoterminowe ramy czasowe. Day traderzy, którzy utrzymują swoje pozycje przez mniej niż godzinę, będą korzystać z 10-minutowego wykresu jako okresu pośredniego, wykresu godzinowego jako długoterminowego, a dwuminutowego wykresu jako krótkoterminowego. System handlu potrójnego ekranu wymaga uprzedniego zbadania wykresu dla długoterminowego trendu. Zapewnia to, że handel podąża za falą długoterminowego trendu, umożliwiając wejście do transakcji w czasach, gdy rynek porusza się na krótko wbrew trendowi. Najlepsze okazje do kupowania pojawiają się, gdy rosnący rynek powoduje szybszy spadek, a najlepsze okazje do skracania są wskazywane, gdy spadający rynek gromadzi się na krótko. Kiedy miesięczny trend rośnie, tygodniowe spadki oznaczają szanse na kupno. Godzinowe wiece dają możliwość skrócenia, gdy dzienna tendencja spadnie. Uważa się, że giełda podąża za trzema trendami, które analitycy rynkowi rozpoznali w historii i mogą zakładać, że będą kontynuowane w przyszłości. Tendencje te są następujące: długoterminowy trend trwający kilka lat, pośredni trend kilku miesięcy oraz niewielki trend, który ogólnie uważa się za mniej niż kilka miesięcy. Robert Rhea, jeden z pierwszych analityków rynku, określił te trendy jako pływy (trendy długoterminowe), fale (trendy pośrednie) i fale (trendy krótkoterminowe). Handel w kierunku rynku jest ogólnie najlepszą strategią. Fale oferują możliwości wejścia lub wyjścia z transakcji, a zmarszczki powinny być zwykle ignorowane. Chociaż środowisko handlowe stało się bardziej skomplikowane, ponieważ te uproszczone koncepcje zostały wyartykułowane w pierwszej połowie XX wieku, ich fundamentalne podstawy pozostają prawdziwe. Handlowcy mogą nadal handlować na podstawie pływów, fal i zmarszczek, ale ramy czasowe, do których odnoszą się te ilustracje, powinny zostać dopracowane. (Aby dowiedzieć się więcej, sprawdź trendy krótkoterminowe, średnio - i długoterminowe.) W ramach systemu potrójnego ekranu, przedział czasowy, który przedsiębiorca chce osiągnąć, określa się jako przedział czasowy. Długoterminowe ramy czasowe są o jeden rząd wielkości dłuższe, podczas gdy krótkoterminowe ramy handlowców są o jeden rząd wielkości krótsze. Jeśli twoja strefa komfortu lub pośrednie ramy czasowe wymagają utrzymywania pozycji przez kilka dni lub tygodni, wtedy zajmujesz się dziennymi wykresami. Twoje długoterminowe ramy czasowe będą o jeden rząd wielkości dłuższe, a Ty będziesz wykorzystywał cotygodniowe wykresy do rozpoczęcia analizy. Twoje krótkoterminowe ramy czasowe będą określone przez wykresy godzinowe. Jeśli jesteś handlowcem, który zajmuje pozycję w ciągu kilku minut lub godzin, możesz zastosować te same zasady. Pośrednia ramka czasowa może być dziesięciominutowym wykresem, który wykres godzinowy odpowiada długoterminowemu ramowi czasowemu, a dwuminutowy wykres jest ramą czasową krótkoterminową. (Dalszy odczyt, patrz Day Trading: Wprowadzenie.) Pierwszy ekran systemu handlu potrójnym ekranem: Market Tide System handlu potrójnego ekranu identyfikuje wykres długoterminowy lub rynek, jako podstawę do podejmowania decyzji handlowych. Handlowcy muszą zacząć od analizy ich wykresu długoterminowego, który jest o jeden rząd wielkości większy niż ramy czasowe, w których handlowiec planuje handlować. Jeśli zwykle zaczynasz od analizy wykresów dziennych, spróbuj dostosować swoje myślenie do ramy czasowej powiększonej o pięć i rozpocznij analizę handlu, badając cotygodniowe wykresy. Korzystając ze wskaźników trendu, można następnie zidentyfikować trendy długoterminowe. Długoterminowy trend (fala rynkowa) jest wskazywany przez nachylenie histogramu tygodniowego średniej ruchomej dywergencji (MACD) lub związek między dwoma ostatnimi słupkami na wykresie. Kiedy nachylenie histogramu MACD jest podniesione, byki kontrolują, a najlepszą decyzją handlową jest wejście w długą pozycję. Kiedy stok jest opuszczony, niedźwiedzie kontrolują i powinieneś pomyśleć o zwarciu. (Aby dowiedzieć się więcej, zobacz Handel Rozbieżność MACD, Zmienna średnia dywergencja zbieżności - Część 1 i Część 2.) Każdy wskaźnik trendu, który preferuje przedsiębiorca, może być realistycznie używany jako pierwszy ekran systemu handlu potrójnego ekranu. Handlowcy często używali systemu kierunkowego jako pierwszego ekranu lub nawet mniej złożonego wskaźnika, takiego jak nachylenie 13-tygodniowej wykładniczej średniej kroczącej. Bez względu na następujący po nim wskaźnik trendu, zasady są takie same: upewnij się, że najpierw analizujesz trend za pomocą cotygodniowych wykresów, a następnie poszukaj tyknięć na wykresach dziennych, które poruszają się w tym samym kierunku, co tygodniowy trend. . (Aby uzyskać więcej informacji, patrz Ruch kierunkowy - DMI i podstawy średnich kroczących.) Kluczowe znaczenie w wykorzystywaniu fali rynkowej ma rozwijanie umiejętności rozpoznawania zmiany trendu. Pojedynczy wzrost lub spadek wykresu (jak w powyższym przykładzie, pojedynczy skok lub spadek cotygodniowego histogramu MACD) byłby twoim środkiem do identyfikacji długoterminowej zmiany trendu. Kiedy wskaźnik pojawia się poniżej linii środkowej, podaje się najlepsze sygnały kupna na rynku. Kiedy wskaźnik zgaśnie powyżej linii środkowej, emitowane są sygnały najlepszej sprzedaży. Model sezonów ilustrujących ceny rynkowe jest zgodny z koncepcją opracowaną przez Martina Pringa. Model Prings pochodzi z czasów, gdy działalność gospodarcza opierała się na rolnictwie: nasiona wysiewano wiosną, żniwa odbywały się latem, a jesienią wykorzystywano do przygotowania zimnego zaklęcia. W modelu Pring8217s handlowcy wykorzystują te podobieństwa, przygotowując się do zakupu na wiosnę, sprzedaży latem, krótkich zapasów na jesieni i pokrycia krótkich pozycji w zimie. Model Prings stosuje się do stosowania wskaźników technicznych. Wskaźnik quotseasonsquot pozwala określić dokładnie, gdzie jesteś w cyklu rynkowym i kupić, gdy ceny są niskie i krótkie, gdy idą wyżej. Dokładny sezon dla każdego wskaźnika określa jego nachylenie i jego położenie powyżej lub poniżej linii środkowej. Gdy histogram MACD wznosi się spod linii środkowej, jest to wiosna. Kiedy wznosi się ponad linię środkową, jest lato. Kiedy spada z linii środkowej, jest jesień. Kiedy spada poniżej linii środkowej, jest zima. Wiosna to sezon na długi handel, a jesień to najlepszy sezon na sprzedaż krótką. Niezależnie od tego, czy wolisz ilustrować swój pierwszy ekran systemu handlu potrójnego ekranu za pomocą metafory oceanicznej, czy też analogii do zmiany pór roku, podstawowe zasady pozostają takie same. Wykres handlowców jest najważniejszym narzędziem technicznym do podejmowania decyzji handlowych w systemie potrójnego ekranu. Na przykład handlowcy zwykle wykorzystują tygodniowe histogramy rozbieżności średniej zbieżności (MACD), aby ustalić ich długoterminowy trend zainteresowania. Decydując o tym, które zapasy mają być wymieniane codziennie, przedsiębiorca szuka pojedynczego efektu lub spadków pojawiających się na wykresie tygodniowym, aby zidentyfikować długoterminową zmianę trendu. Kiedy pojawia się uprick, a wskaźnik pojawia się poniżej linii środkowej, podaje się najlepsze sygnały kupna na rynku. Kiedy wskaźnik zgaśnie powyżej linii środkowej, emitowane są sygnały najlepszej sprzedaży. Korzystając z metafor oceanicznych, które opracował Robert Rhea (patrz System handlu potrójnego ekranu - część 2), określilibyśmy codzienną aktywność rynkową jako falę, która jest sprzeczna z długoterminową tygodniową falą. Kiedy tygodniowy trend się podnosi (uptick na wykresie tygodniowym), codziennie maleje szansa na kupno. Gdy tygodniowy trend spadnie (spadek na wykresie tygodniowym), codzienne rajdy wskazują na możliwość zwarcia. Drugi ekran 8211 Fala rynkowa Codzienne odchylenia od trendu tygodniowego w dłuższym okresie są wskazywane nie przez wskaźniki trendu (takie jak histogram MACD), ale przez oscylatory. Ze swej natury oscylatory emitują sygnały kupna, gdy rynki słabną i sprzedają sygnały, gdy rynki rosną. Piękno systemu handlu potrójnego ekranu polega na tym, że pozwala on inwestorom skupić się tylko na tych codziennych sygnałach, które wskazują kierunek tygodniowego trendu. (Więcej informacji na ten temat można znaleźć w części Poznawanie oscylatorów - Część 1, Część 2 i Część 3.) Na przykład, gdy tygodniowy trend jest wyższy, system handlu potrójnego ekranu bierze pod uwagę tylko sygnały kupowania z codziennych oscylatorów i eliminuje sygnały sprzedawane z oscylatorów . Kiedy tygodniowy trend się zmniejsza, potrójny ekran ignoruje sygnały kupna z oscylatorów i wyświetla tylko sygnały zwarcia. Cztery możliwe oscylatory, które można łatwo włączyć do tego systemu, to indeks siły, indeks Elder-Ray, stochastyczny i Williams R. (Aby uzyskać więcej szczegółów, patrz: Wykrywanie indeksu sił - część 1 i część 2 i starszy promień wskaźnika: widzenie w Rynek.) Wskaźnik siły Dwudniowa wykładnicza średnia ruchoma (EMA) indeksu siły może być używana w połączeniu z cotygodniowym histogramem MACD. Rzeczywiście, czułość dwudniowego wskaźnika EMA dla siły wymusza najbardziej odpowiednie łączenie z innymi wskaźnikami, takimi jak histogram MACD. W szczególności, gdy dwudniowa EMA indeksu siły wymachuje powyżej linii środkowej, pokazuje to, że byki są silniejsze niż niedźwiedzie. Kiedy dwudniowy wskaźnik siły EMA spada poniżej linii środkowej, wskaźnik ten pokazuje, że niedźwiedzie są silniejsze. (Aby dowiedzieć się więcej na ten temat, zobacz Kopanie głębiej na rynki byków i niedźwiedzi). Dokładniej rzecz ujmując, kupcy powinni kupować, gdy dwudniowy indeks siłowy EMA staje się ujemny podczas trendu wzrostowego. Gdy cotygodniowy histogram MACD wskazuje na trend wzrostowy, najlepszy czas na zakup to chwilowe wycofanie, na co wskazuje ujemny obrót dwudniowego indeksu siłowego EMA. Kiedy dwudniowy indeks siły elektromagnetycznej przybierze wartość ujemną podczas tygodniowego trendu wzrostowego (jak wskazano na cotygodniowym histogramie MACD), należy złożyć zamówienie kupna powyżej wysokiej ceny danego dnia. Jeśli trend wzrostowy zostanie potwierdzony, a ceny wzrosną, otrzymasz zlecenie stop na dłuższym boku. Jeśli zamiast tego ceny spadną, zamówienie nie zostanie zrealizowane, możesz następnie obniżyć zamówienie kupna, tak aby mieściło się w jednym tiku najwyższego poziomu najnowszego paska. Gdy trend krótkoterminowy się odwróci i zostanie wyzwolony kupujący stop, możesz dodatkowo zabezpieczyć się przed kolejnym zatrzymaniem poniżej najniższego dnia handlu lub poprzedniego dnia, w zależności od tego, która z niższych wartości jest niższa. W silnym trendzie wzrostowym twoje zabezpieczenie nie zostanie uruchomione, ale twój handel zostanie zakończony wcześniej, jeśli trend okaże się słaby. Te same zasady obowiązują w odwrotnej kolejności podczas tygodniowego trendu spadkowego. Handlowcy powinni sprzedawać krótko, gdy dwudniowy indeks siły roboczej EMA zmieni się na pozytywny podczas tygodniowego trendu spadkowego. Następnie możesz złożyć zamówienie, aby sprzedać krótko poniżej najniższego z najnowszych cenników. Podobnie, jak w przypadku opisanej powyżej pozycji długiej, pozycja krótka umożliwia stosowanie przystanków zabezpieczających w celu zabezpieczenia zysków i uniknięcia niepotrzebnych strat. Jeśli dwudniowa indeks siły roboczej EMA będzie nadal rosnąć po złożeniu zlecenia sprzedaży, możesz codziennie podnosić zlecenie sprzedaży, tak aby mieściło się ono w jednym tiku ostatnich niskich słupków. Kiedy twoja pozycja krótka zostanie ostatecznie ustalona przez spadające ceny, możesz umieścić stop ochronny tuż powyżej najwyższej z najnowszego paska cen lub poprzedniego paska, jeśli jest wyższy. (Aby dowiedzieć się więcej, zobacz Zlecenie Stop Loss - upewnij się, że go używasz.) Jeśli twoje długie lub krótkie pozycje nie zostały jeszcze zamknięte, możesz użyć dwudniowego EMA z indeksem sił, aby dodać do swoich pozycji. W tygodniowym trendzie wzrostowym kontynuuj dodawanie do longów, gdy wskaźnik siły zamienia się w ujemny, ciągle dodawaj do szortów w trendach spadkowych, ilekroć indeks siły zmieni się na dodatni. Co więcej, dwudniowy indeks siłowy EMA wskaże najlepszy czas na zamknięcie pozycji. W przypadku handlu na podstawie długoterminowego trendu tygodniowego (jak wskazuje tygodniowy histogram MACD), przedsiębiorca powinien opuścić pozycję tylko wtedy, gdy zmienia się trend tygodniowy lub jeśli istnieje rozbieżność między dwudniowym EMA indeksu siły i trend. Kiedy rozbieżność między dwudniowym wskaźnikiem siły EMA a ceną jest zwyżkowa, emitowany jest silny sygnał kupna. Na tej podstawie występuje dezorientacja, gdy ceny osiągają nowy poziom, ale indeks siły powoduje płytsze dno. Sygnały o sprzedaży są podawane przez niedźwiedzie rozbieżności między dwudniowym wskaźnikiem siły EMA a ceną. Bierna dywergencja jest realizowana, gdy ceny rosną do nowego poziomu, podczas gdy indeks siły uderza w dolny górny szczyt. The market wave is the second screen in the triple screen trading system, and the second screen is nicely illustrated by force index however, others such as Elder-Ray, Stochastic, and Williams R can also be employed as oscillators for the market wave screen. The triple screen trading system is based on employing the best of both the trend-following indicators and oscillators to make trading decisions. Traders are primarily concerned with any realized divergences between the readings of a longer-term trend-following indicator such as a weekly moving average convergence divergence (MACD) histogram and the relatively shorter-term reading from an oscillator such as force index, Elder-Ray, stochastic, or Williams R. The fourth section of this series, will examine the means by which a trader would use the Elder-Ray oscillator as the market wave, which is the second screen of the traders triple screen system. (For further reading, see Triple Screen Trading System - Part 3 and The Elder Ray Indicator: Seeing Into The Market.) Second Screen - Elder-Ray Elder-Ray, devised by Dr. Alexander Elder, is based on the concepts of bull power and bear power, the relative strength of bulls and bears in the market. Bull power measures the ability of market bulls to push prices above the average consensus of value, which is the actual price at which a particular stock happens to be trading for a given point in time. Bear power is the bears ability to drive prices lower than current prices, or the current average consensus of value. (See Trading Psychology And Technical Indicators.) By using a longer-term trend-following indicator, perhaps a weekly MACD histogram, traders can identify the direction of the longer-term trend. Bull power and bear power are then used to find trades on the daily charts that move in the same direction as the weekly trend. The triple screen earns its quotscreeningquot label because it eliminates all signals but those in the direction of the trend: if the weekly trend is up, only buy signals are returned from Elder-Ray. If the weekly trend is down, only Elder-Ray sell signals are considered. Buy Signals There are two absolutely essential conditions that need to be in place for traders to consider buying: 1) the weekly trend should be up, and 2) bear power, as represented on Elder-Ray, should be negative but rising. The second condition - negative bear power - is worth exploring. The opposite condition, in which bear power is positive, occurs in a runaway uptrend, a dangerous market environment for trading despite the apparent strength of the trend. The problem with buying in a runaway uptrend is that you are betting on the greater fool theory, which states that your profit will be realized only by eventually selling to somebody willing to pay an even higher price. When bear power is negative but rising, bears are showing a bit of strength but are beginning to slip once again. By placing a buy order above the high of the last two days, your stop order will be filled only if the rally continues. Once you have gone long, you can protect your position with a stop below the latest minor low. Bullish divergences between bear power and price (average consensus of value) represent the strongest buy signals. If prices fall to a new low but bear power shows a higher bottom, prices are falling and bears become weaker. When bear power moves up from this second bottom, you can comfortably buy a larger number of shares than you typically would in your usual position. (See Getting Confirmation With The Momentum Strategy and Momentum Trading With Discipline.) You can also use Elder-Ray to determine the best time to sell your position. By tracking the pattern of peaks and valleys in bull power, you can ascertain the power of bulls. By stacking the peaks in actual price against the peaks in bull power, you can determine the strength of the uptrend - if every new peak in price comes along with a new peak in bull power, the uptrend is safe. When prices reach a new high but bull power reaches a lower peak than that of its previous rally, the bulls are losing their power and a sell signal is issued. (For more info, see Peak-And-Trough Analysis.) Shorting Elder-Ray as the second screen in the triple screen trading system can also be used to determine the conditions in which shorting is appropriate. The two essential conditions for shorting are 1) the trend is down and 2) bull power is positive but falling. (For further reading, check out Short Selling Tutorial.) If bull power is already negative, selling short is inappropriate because bears have control over the market bulls. If you short sell in this condition, you are effectively betting that bears have sufficient strength to push bulls even farther under water. Furthermore, as in the case discussed above, wherein the trader holds a long position during positive bear power, you are betting on the greater fool theory. When bull power is positive but falling, the bulls have managed to grasp a bit of strength but are beginning to sink once again. If you place a short order below the low of the last two days, you receive an order execution only if the decline continues. You can then place a protective stop above the latest minor high. Bearish divergences between bull power and prices (average consensus of value) give the strongest shorting signals. If prices hit a new high but bull power hits a lower top, the bulls are weaker than before, and the uptrend may not continue. When bull power inches down from a lower top, you can safely sell short a larger-than-usual position. You can also determine when to cover your short positions on the basis of a reading of Elder-Ray. When your longer-term trend is down, bear power will indicate whether bears are becoming stronger or weaker. If a new low in price occurs simultaneously with a new low in bear power, the current downtrend is relatively secure. A bullish divergence issues a signal to cover your shorts and prepare to enter into a long position. Bullish divergences occur when prices hit a new low and bear power hits an even shallower bottom, when bears are losing their momentum and prices are falling slowly. For both long and short positions, divergences between bull power, bear power and prices indicate the best trading opportunities. In the context of the long-term trend indicated by our first market screen, Elder-Ray identifies the moment when the markets dominant group falters below the surface of the trend. For the second screen of the triple screen trading system, Dr. Alexander Elder recommends the use of sophisticated and modern oscillators like force index and Elder-Ray. However, traders should not feel limited to either of these two oscillators - your favorite oscillator will probably work equally well, so you should substitute the oscillator with which you feel most comfortable. Two other oscillators that can easily be employed as the second screen are the stochastic and Williams R oscillators. Stochastic Stochastic is currently one of the more popular oscillators and is included in many widely available software programs used both by individual traders and professionals. In particular, traders who employ strict computerized systems to execute their trades find that stochastic oscillators have many good qualities. For example, stochastic has an excellent track record in weeding out bad signals. More specifically, stochastic uses several steps for the express purpose of filtering out market noise, the type of ultra short-term movements that do not relate to the traders current trend of interest. Similarly to Elder-Ray, stochastic identifies the precise moment at which bulls or bears are becoming stronger or weaker. Obviously, traders are best off jumping aboard the strongest train and trading with the winners while pitting themselves directly against the losers. The three types of signals important to traders using stochastic are divergences, the level of the stochastic lines and the direction of the stochastic lines. (To further detail, see Getting To Know Oscillators - Part 3: Stochastics and What is the difference between fast and slow stochastics in technical analysis) Divergences A bullish divergence occurs when prices hit a new low but stochastic traces a higher bottom than it did in the previous decline. This means the bears are losing their grip on the market and simple inertia is driving prices lower. A very strong buy signal is issued as soon as stochastic turns up from its second bottom. Traders are well advised to enter into a long position and place a protective stop below the latest low in the market. The strongest buy signals appear when the stochastic lines first bottom is placed below the lower reference line and the second bottom above it. Conversely, a bearish divergence corresponds to the circumstance in which prices rally to a new high but stochastic reaches a lower top than anytime during its previous rally. Bulls are then becoming weaker and prices are rising sluggishly. The crucial sell signal is issued when stochastic turns down from its second top. Traders should enter a short position and place a protective stop above the latest price high. The best signals to sell short occur when the first top is above the upper reference line and the second is below it, the opposite of the best signals to go long. (To learn more, check out Divergences, Momentum And Rate Of Change and Moving Average Convergence Divergence - Part 1 and Part 2.) Level of Stochastic Lines The level attained by the stochastic lines represents distinct overbought or oversold conditions. When stochastic rallies above the upper reference line, the market is said to be overbought and is ready to turn downwards. By contrast, the oversold condition, in which the market is ready to turn up, is represented by the stochastic falling below its lower reference line. Traders should, however, be careful in interpreting overbought and oversold conditions using stochastic: during a longer-term trend, stochastic may issue contrary signals. In strong uptrends - as may be indicated by the traders first market screen - the moving average convergence divergence (MACD) histogram, stochastic becomes overbought and issues erroneous sell signals while the market rallies. In downtrends, stochastic quickly becomes oversold and gives buy signals earlier than warranted. Although interpreting overbought and oversold conditions with stochastics can be problematic, when using the MACD histogram as the first screen of the triple screen trading system, traders can easily eliminate these incorrect signals. Traders should take buy signals from the daily stochastic only when the weekly MACD histogram shows an upward trend. When the trend is down, only sell signals from the daily stochastic should be heeded. Using your weekly chart to identify an uptrend, wait for daily stochastic lines to cross below their lower reference line before buying. Immediately place your buy order above the high of the latest price bar. You can then protect your position with a protective stop placed below the low of the trade day or the low of the previous day, whichever is lower. To add a further level of detail to this analysis, how the shape of stochastics bottom can indicate the relative strength of the rally should be discussed. If the bottom is narrow and shallow, the bears are weak and the rally is likely to be strong. If the bottom is deep and wide, the bears are strong and the rally could very well be weak. When you identify a downtrend on your weekly chart, do not enter your trade until daily stochastic lines rally above their upper reference line. You can then immediately place an order to sell short below the low of the latest price bar. Do not, however, wait for a crossover on the stochastic lines as the market will then already likely be in a free fall. To protect your short position, place a protective stop above the high of that particular trading day or the previous day, whichever is higher. The shape of stochastics top can also indicate the relative steepness or sluggishness of the markets decline. A narrow top in the stochastic line shows the weakness of bulls and the likelihood of a severe decline. A high and wide stochastic top demonstrates the strength of bulls, and short positions should consequently be avoided. In summary, the means by which traders can filter out most bad trades involves an intimate knowledge of overbought and oversold conditions. When stochastic is overbought, do not buy. When stochastic is oversold, do not sell short. Stochastic Line Direction Quite simply, when both of the stochastic lines are moving in the same direction, the short-term trend is confirmed. When prices rise along with both stochastic lines, the uptrend is most likely to continue. When prices slide along while both stochastic lines are falling, the short-term downtrend will likely continue. When employed correctly, stochastic can be an extremely effective and useful oscillator as part of your triple screen trading system. In Part 6 of this article, well examine the fourth oscillator of interest, Williams R. In previous parts to this series on Dr. Alexander Elders triple screen trading system, various oscillators have been discussed in relation to the second screen of the system. Two excellent oscillators that work extremely well within the system are force index and Elder-Ray however, any other oscillators may also be employed. Part 5 of this series described stochastic in relation to the powerful signals formed by divergences between the power of bulls and bears in the market. In this section, we8217ll discuss one final oscillator that can be used as the second screen in the triple screen trading system: Williams R. Williams R The final oscillator that needs consideration in relation to its use as the second screen of the triple screen trading system is Williams R, which is actually interpreted in similar fashion to that of stochastic. Williams R, or WmR, measures the capacity of bulls and bears to close the days stock prices at or near the edge of the recent range. WmR confirms the strength of trends and warns of possible upcoming reversals. The actual calculation of WmR will not be dissected in detail in this space, as its current value can be obtained through top trading software packages that are widely available today. In its calculation, WmR measures the placement of the latest closing price in relation to a recent high-low range. It is important to note that WmR requires at least a four - to five-day range of prices to work effectively with the triple screen trading system. WmR expresses the distance from the highest high within its range to the lowest low in relation to a 100 scale. The distance from the latest closing price to the top of the range is expressed as a percentage of the total range. When WmR is equal to 0 on the 100 scale, the bulls reach the peak of their power and prices should close at the top of the range. In other words, a zero reading, plotted at the top of the chart, indicates maximum bull power. When WmR reads 100, the bears are at the peak of their power and they are able to close prices at the bottom of the recent range. The high of the range is a precise measure of the maximum power of bulls during the period in question. The low of the range relates to the maximum power of bears during the period. Closing prices are especially significant in calculating WmR, as the daily settlement of trading accounts depends on the days (or weeks, or months) close. WmR provides a precise assessment of the balance of power between bulls and bears at the market close, the most crucial time for a true feel for the relative bullishness or bearishness of the market. If we extrapolate this concept one level further, we see that WmR shows which group is able to close the market in its favor. If the bulls cannot quite close the market at or near the top during a market rally, the bulls are proven to be somewhat weaker than they appear. If bears cannot close the market near the lows during a bear market, they are weaker than they would appear on the surface. This situation presents a buying opportunity. If reference lines are drawn horizontally at 10 and 90 levels, this further refines the WmR interpretation. When Wm closes above its upper reference line, the bulls are strong, but the market is said to be overbought. When WmR closes below the lower reference line, the bears are strong but the market is oversold. (For additional insight, see Market Reversals And How To Spot Them and Price Patterns - Part 1.) Overbought and Oversold In an overbought condition, WmR rises above its upper reference line and prices close near the upper edge of their range. This may indicate a market top, and the WmR issues a sell signal. In an oversold condition, WmR falls below its lower reference line and prices close near the bottom of their range. This may indicate a market bottom, and the WmR issues a buy signal. During flat trading ranges, overbought and oversold signals work very well. However, when the market enters a trend, using overbought and oversold signals may be dangerous. WmR can remain near the top of its range for a week or longer during a strong rally. This overbought reading may actually represent market strength rather than the erroneous shorting signal that WmR would issue in this circumstance. Conversely, in a strong downtrend, WmR can remain in oversold territory for a long period of time, thereby demonstrating weakness rather than a buying opportunity. For these reasons, overbought and oversold readings of WmR should be used only after you have identified the major trend. This is where the first screen in the triple screen trading system is absolutely essential. You must use that first screen to ascertain whether you are currently embroiled in a longer-term bull or a bear market. (For refresher on the first screen, check out Triple Screen Trading System - Part 1.) If your longer-term chart shows a bull market, take buy signals only from your shorter-term WmR, and do not enter a short position when it gives a sell signal. If your weekly chart indicates a bear market, sell short only when WmR gives you a sell signal, but do not go long when WmR becomes oversold. Failure Swings When WmR fails to rise above its upper reference line during a rally and turns down in the middle of that rally, a failure swing occurs: bulls are especially weak, and a sell signal is issued. When WmR stops falling in the middle of the decline, failing to reach the lower reference line and turning up instead, the opposite failure swing occurs: the bears are very weak and a buy signal is issued. (For further insight, see The Dead Cat Bounce: A Bear In Bull8217s Clothing and Short-, Intermediate - and Long-Term Trends and Relative Strength Index And Its Failure-Swing Points.) Divergences The final important situation in reading WmR relates to divergences between prices and WmR. Divergences rarely occur, but they identify the absolute best trading opportunities. A bearish divergence occurs when WmR rises above its upper reference line, then falls and cannot rise above the upper line during the next rally. This shows that bulls are losing their power, that the market is likely to fall and that you should sell short and place a protective stop above the recent price high. By contrast, a bullish divergence occurs when WmR falls below its lower reference line, then moves up (rallies), and cannot decline below that particular line when prices slide the next time around. In a bullish divergence, traders should go long and place a protective stop below the recent price low. (To learn more, see The Stop-Loss Order - Make Sure You Use It and A Look At Exit Strategies.) At long last, the next part of this series on the triple screen trading system will provide a discussion of the third screen in the system. The first screen of the system identifies a market tide the second screen (the oscillator) identifies a wave that goes against the tide. The third and final screen of the triple screen system identifies the ripples in the direction of the tide. These are intraday price movements that pinpoint entry points for your buy or sell orders. The triple screen trading system can be nicely illustrated with an ocean metaphor. The first screen of the triple screen trading system takes a longer-term perspective and illustrates the market tide. The second screen, represented by an oscillator, identifies the medium-term wave that goes against the tide. The third screen refines the system to its shortest-term measure, identifying the ripples that move in the direction of the tide. These are the short-term intraday price movements that pinpoint entry points for your buy or sell orders during the trading day. (If you need a refresher, check out Triple Screen Trading System - Part 1, Part 2 and Part 3.) Fortunately, for those of us who have become weary of interpreting charts or technical indicators in the first and second screen, the third screen does not require any additional technical talent. Instead, the third screen provides us with a technique for placing stop orders, either buy stop orders or sell stop orders, depending on whether the first and second screens direct you to buy or to sell short. More specifically, the third screen is called a trailing buy stop technique in uptrends and a trailing sell stop technique in downtrends. When the weekly trend is up (identified by the first screen) and the daily trend is down (identified by the second screen, or oscillator), placing a trailing buy stop will catch upside breakouts. When the weekly trend is down and the daily trend is up, trailing sell stops catch downside breakouts. Each situation deserves further examination. Trailing Buy Stop Technique When you have identified that a longer-term (weekly) trend is moving up and your medium-term (daily) oscillator declines, the triple screen trading system activates a trailing buy stop technique. To instigate the trailing buy stop technique, place a buy order one tick above the high of the previous day. Then, if prices rally, you will be stopped into a long position automatically at the time that the rally exceeds the previous days high. If, however, prices continue to decline, your buy stop order will not be touched. This technique allows you to be stopped into your order if the shortest-term ripples have sufficient momentum to power the wave into the greater tide. The buy stop is therefore most closely related to what most traders would label as momentum investing. However, the use of all three screens within the triple screen trading system provides a much more detailed and refined picture of the market than the simple concept of momentum generally provides. (For further reading, see Momentum Trading With Discipline and Introduction To Types Of Trading: Momentum Traders.) If you want to further refine the trailing buy stop technique, you can lower your buy order the next day to the level one tick above the latest price bar. Keep lowering your buy stop each day until stopped out (filling your order at the very best time) or until your long-term (weekly) indicator reverses and cancels its buy signal (saving you from a loss). The reason that the buy stop technique is prefaced by the trailing qualification relates to this fluid nature of the buy stop order. You must, however, remain vigilant in monitoring the markets momentum, and you must be diligent in continually moving your buy stop to one tick above the latest price bar. The process can be laborious, but it will ensure that you either fill your order at the very best price or avoid a poor trade altogether if the market fails to move your way. (To read more, check out Trailing Stop Techniques and The Stop-Loss Order - Make Sure You Use It.) Trailing Sell Stop Technique The opposite situation occurs when your long-term (weekly) trend is down, at which time you would wait for a rally in your medium-term indicator (oscillator) to activate a trailing sell stop technique. In the trailing sell stop technique, you place an order to sell short one tick below the latest bars low. When the market turns down, you will automatically be stopped into your short trade. If, however, the market continues to rally, you can continue to raise your sell order on a daily basis. Opposite to the trailing buy stop technique, the trailing sell stop technique is meant to catch an intraday downside breakout from a daily uptrend. As you can see, the intraday downside breakout moves in the direction of the market tide, which in this case is a weekly downtrend. The trailing buy stop and trailing sell stop techniques are the ultimate refinements to what is already an extremely powerful trading system within the first two screens of the three screens. Using a less developed indicator, many beginning traders will engage in a system of trailing stopped orders when they attempt to gauge market momentum. By employing a longer-term chart and a medium-term oscillator first, you can capitalize on the short-term market ripples as you make the best trades that this intraday allows. The next section of this series will bring the triple screen trading system to a close. The journey through all three screens has been long, but the result is most definitely worthwhile. If you are able successfully to implement the triple screen trading system to its fullest, you are on your way to being ahead many other trader with whom you are competing for profits At long last, we have reached the end of this series describing all facets of the triple screen trading system. You will recall that the third screen in the system, the trailing buy or sell stop system, allows for the ultimate level of precision in your buy orders or, if you are selling short, your sell orders. By identifying the ripples moving in the direction of the market tide, you will best be able to capitalize on the short-term (usually intraday) price movements that pinpoint the exact points at which you should enter your position. (To brush up on previous sections, see Triple Screen Trading System - Part 1, Part 2, Part 3, Part 4, Part 5, Part 6 and Part 7.) Stop loss Technique But we have yet to discuss how the triple screen trading system assists a trader, once in a position, to secure a profit and avoid significant losses. As is the case in all levels of trading, and investing at large, the decision to exit your position, whether long or short, is just as important as your decision to enter a position. The triple screen trading system ensures that you make use of the tightest stops, both in entering and in exiting your position. Immediately after executing your purchase order for a long position, you place a stop loss order one tick below the low of the trade day or the previous day, whichever is lower. The same principle applies to a short sale. As soon as you have sold short, place a protective stop loss one tick above the high of the trade day or the previous day, whichever is highest. In order to protect against the potential for losses, move your stop to a breakeven level as soon as the market moves in your favor. Assuming that the market continues to move you into a position of profits, you must then place another protective stop at your desired level of profits. Under this system, a 50 profit level is a valid rule of thumb for your targeted profitability. The Importance of Stop Loss The stop loss orders used in exiting a position are very tight under this system because of the fundamental tide of the market. If you enter into a position using the analysis tools contained in the triple screen trading system only to see the market immediately move against you, the market has likely undergone a fundamental shift in tide. Even when identifying the markets probable long-term trend in the first screen, you can still be unlucky enough to enter your trade, for which you use the third screen, at the very moment at which the long-term trend is changing. Although the triple screen system can never identify this condition organically, the trader can prevent losses by keeping his or her stop loss extremely tight. (For further reading, see The Stop-Loss Order - Make Sure You Use It, A Look At Exit Strategies and Can a stop-loss order be used to protect a short sale transaction) Even if your position enters into the red, it is always better to exit early and take your loss sooner rather than later. Realize your small loss, then sit back, and observe what is happening in the market. You will likely be able to learn something from the experience: if the market truly has shifted its long-term direction, you might better be able to identify the situation should it happen again in the future. Conservative and Aggressive Exit Strategies The above discussion has outlined a relatively conservative strategy for risk-averse traders. By maintaining the tightest stop loss orders possible, conservative traders can easily go long or short on the first strong signal from the triple screen trading system and stay with that position for as long as the major trend lasts. Once the trend reverses, the profits will already be locked in. If the market reverses prematurely, the trader will be stopped out of major losses. A possibility for more aggressive, active traders is to continue watching the market after entering into a long or short position. While the longest-term trend is still valid, active traders can use each new signal from the second screen (the daily oscillator) to supplement the original position. This approach allows for a greater level of gross profit while still allowing the stop loss approach to protect the entire position. Adding to the original position while the trend continues is often referred to as pyramiding the original position. Another type of trading is practiced by the position trader, who should try to go long or short on the very first signal issued by the triple screen system. Then he or she should stay with that position until the trend reverses. Finally, a short-term trader may take profits using signals from the second screen. You may recall that the second screen identifies the medium-term wave that goes against the larger tide. Using the very same second screen indicator that is used prior to entering the trade, the short-term trader can use intraday occurrences of market reversals to exit the trade. If, for example, the short-term trader uses stochastic as his or her second screen oscillator, he or she may sell the entire position and take the profits when stochastic rises to 70. The trader can then revisit the first screen of the system, reconfirm the market tide and continue to drill down to the second and third screens in order to identify another buying (or selling) opportunity. Conclusion The length of this eight-part series demonstrates that Dr. Alexander Elders triple screen trading system is not the simplest means of identifying buying and selling opportunities on the markets. The system is, however, one of the most powerful means of combining a series of useful individual indicators into one comprehensive whole. The time that you spend reading these articles and familiarizing yourself with the individual components of the system will undoubtedly pay dividends to your trading success. MACD3SS. ex4 3 KB 1,658 download Uploaded Jul 9, 2017 3:05am by Jack Crooks Saturday, September 1, 2017 at 7:30am I realize its never easy and rarely simple. But today Im going to help you understand why global money-flow drives key markets and how that flow could be reversing. If I am right, it is good news for long-term dollar bulls like me, bad news for China bulls, and terrible news if you are still riding on the Peak Oil bandwagon expecting oil to hit 200 barrel soon. Three major realities lead me to those conclusions: Reality 18212 Foreign exchange reserves and growth is falling in China Some experts estimate that up to 50 billion a month is exiting China. Keep in mind, when money leaves China, it leaves as dollars for the most part. Investors exchange yuan for dollars inside China, or Hong Kong, then move those dollars to safe haven areas, such as U. S. Treasuries, U. S. farmland, or Vancouver apartment buildings. Reality 28212 Demand for oil is falling along with global growth, and the U. S. is leading the way Chinas crude oil imports fell 3 percent in July from a month ago to a nine-month low. The slowdown in growth is hitting oil demand hard in the country that has driven the increase in global fuel consumption for a decade. In fact, the International Energy Agency slashed its forecast for Chinese oil demand growth in 2017 by a third to 240,000 barrels per day (bpd) in its August monthly report. Just a month earlier, the agency had forecast growth of 360,000 bpd. If demand is already low and appears to be heading lower, I think it is time to mark down oil prices. And in the U. S. according to Reuters, oil demand in July fell to its lowest level in nearly four years. The chart below shows oil hit a brick wall of resistance at around 98 per barrel that happens to be a key retracement level. Plus, the price oscillators are turning down from an quotoverboughtquot level. This price action seems to be confirming bearish fundamental news. Reality 38212 The dollar is the worlds monetary standard The demand for dollars is poised to rise as the supply falls. I say that because: Dollar-based funding (supply) for trade finance and other credit lines is falling as European banks reduce the percentage of debt on their balance sheets. As I explained above, dollars are leaving China. And I expect Chinas foreign exchange reserve hoard to continue to decline. Falling oil prices are dollar bullish, as countries that buy oil on world markets 8212 priced in dollars 8212 can reduce their dollar credit lines, which reduces the potential of a new supply of dollars from coming on the market. If a global credit crunch similar to the credit crunch of 2007 materializes, demand for dollars and dollar-safe havens will soar. Now, take a look at the chart below, which shows how all of these global money-flow factors discussed above relate to each other. Chinese foreign exchange reserve growth (red line) oil prices (black line) and the U. S. dollar index (blue line) There is a lagging correlation between Chinese FX reserve growth and oil prices, with Chinese FX growth leading. There is a tight negative correlation between oil prices and the dollar i. e. as oil prices rise the dollar tends to fall and vice versa. If these macro trends continue to play out as I expect, your decision is easy: Sell oil, buy the dollar, and hold those positions until the trend changes. Have a safe and happy Labor Day weekend, Japan: An Accident Waiting to Happen The worlds largest debt bomb isnt Greece or Spain. Its Japan, where government debt now approaches 220 of gross domestic product. That level of spending makes profligate congressmen in America look downright parsimonious with taxpayer cash. Servicing Japans debt now consumes some 43 of government revenue, up from about 4 in the early 1970s. Its a situation thats clearly not sustainable. In theory, that much debt and all the money the Bank of Japan keeps printing to keep the country afloat should have destroyed the yen by now. Yet, it hasnt. And the reason it hasnt comes down to the countrys savings pattern. Japan is able to run huge deficits and sustain such high debt-to-GDP because it has used its vast savings over the last 50 years to fund government spending. I recently talked to my colleague, Evaldo Albuquerque, to get his thoughts. Evaldo is one of the smartest analysts I know. He made a name for himself in foreign currencies, but were teaming up to find unique, safe income plays. Heres his take: The yen hasnt collapsed yet because Japanese financial institutions hold 93 of government debt. In other words, domestic investors have financed the governments spending for the past two decades. The problem is Japan has the worlds fastest-growing population of seniors aged 65 years and older. Once all these seniors retire, they will no longer be saving. Instead, they will be cashing out their retirement accounts. The Japanese government will have to find other investors to buy their bonds. Who will buy Japanese bonds paying less than 1 International investors will certainly require a higher rate, increasing interest expenses. The government simply cant afford that. In other words, the countrys savings rate will soon go negative. And thats going to be the tipping point for the currency. For years now, Japan has been printing money and buying government debt to keep interest rates from skyrocketing. But once the savings rate turns negative, Japans government will no longer have domestic cash to rely on. So, theyll do what every government does when faced with making impossibly hard decisions theyll turn on the printing presses and crank out boatloads of yen. And the yen will finally crack. If its a managed devaluation of the yen, as I expect, Japans export-dependent companies will be big, big beneficiaries. Thats because the sales that Japanese companies accumulate in dollars, euros, pounds and yuan will translate into more and more yen as the Japanese currency weakens. Thats essentially free profits because, aside from some tax obligations, currency gains have no associated costs on a corporate income statement. What about China The answer is important because China affects so much of the world economy, especially as it relates to commodity prices and your commodity stocks A friend of mine forwarded me a story where a certain strategist said it was time to quotstart adding Chinese exposure. quot He said, quotWhere else can you buy an economy with 7-8 growth prospects at less than 10 times estimated earningsquot To believe his statement, you have to take two things at face value: 1. Chinas GDP numbers are, at least, roughly accurate. 2. Chinas earnings are, at least, roughly equivalent to earnings of other markets. I dont buy either statement. The 7-8 growth rate assumption comes from Chinas own GDP statistics. GDP, which stands for quotgross domestic product, quot is a widely accepted rough guess of economic growth. For an investor, it is almost useless, and I usually ignore it. Thats because as an investor, youre not buying quotthe economy. quot Youre buying individual securities. The characteristics of those securities should be your focus. Stick to the basics and whats in front of you. Dont get lost in abstractions like quotGDP. quot But lets play ball for a bit. If you want to rely on Chinese GDP figures to frame some kind of investment thesis, then you should know there is a lot of room to doubt their veracity. So officially, Chinas government says its economy is growing 8. Lots of people dont believe it. Charles Dumas, of Lombard Street Research, is one. He says: quotWe dont believe official data. We think GDP slowed to a 1 rate in the first quarter. quot I dont believe official data either, and I certainly dont make investment decisions based on it. Two other quick points about relying on GDP: GDP figures are backward-looking. They tell you nothing about the future. Even if you think they do, then you have to say the trend is not good. Chinas first-quarter GDP was at a three-year low. GDP as a concept is absurd. Government spending is counted as a positive. So a government that spends money digging holes and refilling them is adding to its countrys GDP. Who knows at what rate Chinas economy is really growing Frankly, I think it is an unknowable. Chinas economy is a huge, complex thing. It has many parts going in all kinds of directions. To boil all that down to a single number always strikes me as silly. The second point up top is on Chinas corporate earnings. There is a good case that such earnings deserve heavy discounting. Maybe 10 times earnings is the right number in todays environment. As Ivy Pan, an analyst with ABN AMRO, said recently, quotForecasts of company earnings have been continuously revised downward since the beginning of the year. quot Besides, there is the issue of earnings quality and trustworthiness. This is a matter of debate, too. So there is a lot of guesswork. There are also things we do know. The strategist up top cites healthy increases in imports of coal, iron ore, and copper as a plank to his bullish thesis on China. He says the increase is consistent with an economy growing 7-8. Again, we have to question how the figures come about. I think it is safe to say that Chinese government-mandated investment drives these figures. And I tend to think of that as more of a bad thing, not a good thing. Will it prop up commodity markets to some extent Of course. Its not a game I care to play, though. Anyway, it seems an odd thing to cite these commodities. Despite decent Chinese import figures, iron ore prices recently hit 2.5-year lows. Iron ore prices are down 17 since mid-June. Coking coal is down 23 since the start of July. Copper prices are down more than 20 from a year ago. Chinese steel mills are hurting. The China Iron and Steel Association said recently that the Chinese steel industrys profits fell 96 in the first half of the year compared with last year. Thats not a typo: down 96. These anecdotes dont square with the image of a booming economy. I dont know what will happen, but I find the whole thing fascinating. Ive been bearish on China in the last year, but I think some of the air has already come out of Chinas boom. (Take a look at housing prices, for instance. Chinese housing prices registered nine months of decline, and they just had an uptick.) And there are definitely China themes Id own andor will continue to own those that play on Chinas need for water and food, for instance. These are very good long-term investment themes, regardless of what happens in China in the near term. But what about commodities Now we turn to the other piece of the puzzle. Most people wouldnt care a whit about Chinas economy. They care because China is such a big user of commodities and has such an impact on world prices. A growing China is a key to the commodity bull market. But the commodity bull market is long in the tooth. It started in roughly 2000. (Jim Rogers and others date it from 1998.) So the bull market is at least 12 years old. The average lasts about 17 years, according to Jim Rogers book Hot Commodities. However, this one may already be beyond whats normal. A reader sent me this chart on commodity prices from BCA Research and Allan Gray: What this chart shows is that the long boom in commodity prices over the last dozen years has pushed commodity prices more than two standard deviations above their long-term trend line. In other words, were in outlier territory. As you can see, not too many past bull markets have pushed much beyond where we are now. There is another important point about that chart. Commodities, despite what you hear, are a poor way to preserve wealth over a long period of time. As Ian Liddle of Allan Gray notes: Importantly, the long-term trend line is down. This is a testament to human ingenuity. Over the last two centuries, we have constantly found new and more-efficient ways to produce and use commodities, and this has driven prices down over time. The new technologies to access Americas considerable shale gas reserves are the latest example of this. We believe it would be a mistake to simply extrapolate the strong rise in commodity prices over the last decade far into the future. I dont think this dynamic is somehow suspended in our own times. Commodities will continue to fall in real terms that is, adjusted for inflation over a long period of time. I think weve turned, or are turning, another corner. We should expect lower highs and lower lows on most commodities (in real terms) as the commodity bull market unwinds. It will affect everything from iron ore to oil. (I exclude the precious metals, on which I remain bullish.) If the bull market is, indeed, over, we have to change the way we look at investing in commodities. Commodity stocks have to clear different hurdles than in the last dozen years. We should not count on increases in commodity prices. Stocks should work at existing prices and lower. I would favor picks-and-shovels plays over producers. This is the way I plan to play it. Its the safe way to go. If Im wrong, Ill be wrong for a year or two as the commodity bull takes its last breaths. But then, so what There are plenty of other ideas to invest in. The truth is that the end of the commodity bull market is coming. It seems too risky to try to and call the exact top. Start playing it safe now. Start preparing today. Never before have I seen such a divergence between the quotfantasy landquot world central bankers and their faithful live in. and the real world the rest of us inhabit. In fantasy land, this was the big week investors were waiting for The European Central Bank (ECB) met yesterday and decided to buy more sovereign bonds in an attempt to bring down interest rates in troubled European countries. The program is essentially the same thing the ECB already tried earlier, to only limited results. But never mind rumors of the plan were enough for traders to throw a party in August and this week Meanwhile, in the real world, things just kept going from bad to worse, with the economic data deteriorating from one end of the globe to the other Bottom line: The divergences between whats going on in the real world and the puffed-up stock indices, which have been floating on an ocean of cheap money, are the biggest I have ever seen. The last time these divergences were this severe, was right before the stock market crashed in 2007-2008. and early 2000 before that. And THAT has major implications for your wealth What the Fed, ECB Are Doing and What It Means In his closely watched Jackson Hole, Wyoming speech last Friday, Federal Reserve Chairman Ben Bernanke tried to justify his nontraditional approach to monetary policy. He defended QE and pledged to keep interest rates low for longer periods of time, saying (in plain English) that they quotworked. quot I see an economy whose unemployment rate has remained above 8 percent for the longest stretch since the government began keeping track in the 1940s. I see an economy whose GDP is barely growing. I see an economy where confidence remains lackluster and manufacturing is shrinking again. And I see an economy where the only real beneficiaries of easy money are the commodity and stock market speculators who can make money off of it Never mind whether QE is a success or utter failure though. What is important for investors is that Bernanke did not go into detail about other FUTURE nontraditional policy options, such as nominal GDP targeting or unlimited, open ended QE. The fact he didnt mention those kinds of steps lead me to believe theyre less likely to be used. Bernanke also warned that quotthe hurdle for using nontraditional policies should be higher than for traditional policies. quot But most importantly . Bernanke himself admitted in the speech (subtly) that newer rounds of QE and Operation Twist were less effective than the first round. Thats as close to the emperor admitting hes wearing no clothes as you can get without coming out and saying so It fits precisely with what I have been saying for ages too Bottom line: The U. S. Fed will likely NOT engage in a massive new QE program. and even if it does, it could be sold aggressively by investors now that even Bernanke himself is admitting its almost completely ineffective. As for the ECB, President Mario Draghi unveiled plans to buy sovereign bonds with maturities of three years or less. So many leaks came out before the Thursday meeting that the actual news was almost anticlimactic. and now the question is whether or not investors will quotsell the news. quot Why should they Well, the bond purchases will be conditional meaning the ECB wont buy unless the targeted countries (think Spain here) agree to oversight and more supervision by fiscal authorities. The program wont seek to establish firm yield quotcaps, quot another disappointment. Most importantly, the purchases will be sterilized. That means this is not an all-in quotQEquot type strategy that balloons the size of the ECB balance sheet and results in runaway money printing. That is likely reflecting concern among the ECBs members in Germany and other more conservative countries. Global Economy Sinking Deeper into Recession So what about the quotreal worldquot There the news is going from bad to worse. Here in the U. S. the Institute for Supply Managements benchmark manufacturing index sank further to 49.6 in August. That was the third month in a row below 50, which is the dividing line between expansion and contraction in this key sector. Europes benchmark manufacturing index also slumped to 46.3 in August. That indicates the euro-zone economy is sliding deeper into recession, and that the recent rise in unemployment to a fresh euro-era record high is only the beginning As for the BRIC countries, Chinas services sector index just sank to its lowest in a year. Brazil is slowing so much, the central bank was just forced to cut its benchmark interest rate to a record low of 7.5 percent. And in India, GDP growth slowed to 5.5 percent in the June quarter. That was close to a three-year low, and well-below long-term growth targets in the 8 percent to 9 percent range. Now I want to update you on those incredible divergences I mentioned earlier. Virtually every indicator of the REAL economy is slumping or stagnating even as the broad stock market averages try to hold these elevated levels. In the top panel of the chart below, the black line is consumer confidence, the red line is the SampP 500, and the panel on the bottom shows the spread between the two. The last time there was a divergence as huge as it is now was in 2007-2008 right before the stock market crashed. The top panel in the next chart below shows the same comparison only using the ISM manufacturing index and the SampP 500. Youll see that the ISM index did NOT make a higher high along with stocks this year a key divergence. And in the bottom panel youll also see the last time they diverged this much was right before the 2007-2008 stock market crash. The time before that Right before the 2000 stock market crash Bottom line You have the real economy deteriorating sharply. You have key global players in sectors like technology and transportation warning that revenue and earnings growth is slowing rapidly. FedEx (FDX) was just the latest casualty this week, cutting its profit target for the second time since June. And yet, you have investors clinging to the hope that a few policymakers huddling in conference rooms on two sides of the Atlantic can somehow quotsave the world. quot Thats despite the fact the quotsavesquot they are talking about have already failed repeatedly. I think thats a real recipe for trouble. And thats why outside of a few select situations, stocks look very vulnerable to me. Until next time, Commercial Member Joined May 2017 3,332 Posts The ECB pledged to act forcefully to defend the EU and euro by potentially buying bonds to reduce crisis-hit euro-zone countries borrowing costs, which is a good thing. The market didnt price in the lofty summer rhetoric. But on balance, the announcement gives reason to be more bullish on the markets. still not a reason to run out and buy stocks with both hands. One of the most anticipated ECB meetings in history occurred last week, and with it the European crisis entered a new phase. Generally speaking ECB Chief Mario Draghi and the ECB met most of the markets lofty expectations, as evidenced by market action. Perhaps even more important, the ECB didnt disappoint by quotkicking the canquot down the road as European officials have done so many times over the past three years. I say that because. There are multiple risks to monitor over the next several weeks in Europe. Here are three of them:Last Weeks Signal Was NOT an quotAll Clearquot Risk 1 Markets will test the ECB First, you can expect markets to test the ECBs will at some point over the next few weeks by pushing Spanish or Italian yields higher just to see if the ECB was bluffing on its bond-buying promise. If I had to guess where, Id bet well see the first intervention in Spain before the end of October, as there remain multiple troubles brewing there. Risk 2 Spain and Italy have to ask for help before getting it One of the disappointments of the ECB meeting last week was that more strict conditions were placed on countries who need the ECB to buy their bonds than had been expected. Economists on the Street are referring to this as quotconditionality. quot In order for the ECB to buy bonds, Spain and Italy will have to formally request aid and submit to fiscal oversight by the ESMEFSF and the IMF. That implies some loss of sovereignty (psychologically, anyway), which will make Spanish and Italian politicians less likely to request aid until its absolutely necessary. As an outlier, theres a chance that both countries wont request aid. And then it becomes a game of chicken between those countries and the rest of Europe to see who blinks first. Dont think it cant happen either Greece has basically done it twice, and Europe blinked both times. What happens if Spain or Italy get the bailouts needed, but after a while stop adhering to the fiscal reforms mandated by the EFSF or ESM Risk 3 Will bailed-out nations comply The bottom line: If none of those risks mentioned above come to fruition, the ECB announcement last week was a game-changing event in Europe and a reason to think the crisis is nearing an end. But, if any of those risks actually materialize, the consequences are potentially catastrophic. And even if they dont fully materialize, if they appear to be gaining momentum, markets will fall and fall hard. The ECBs answer was very clear and another area of disappointment: If countries getting aid stop implementing necessary fiscal reforms, bond buying stops immediately meaning all this could be an enormous waste of time. One thing we do know from last weeks announcement is that the euro will be sacrificed to keep the EU together. By the ECB choosing to print euros to buy euro-country bonds, it means well see a lower euro over the long term, even though in the short term we could see the euro continue to rally as investors bet the crisis is solved. A big rally in the Euro over the next several weeks could provide a great opportunity to position yourself for the next big move in the currency, which is bound to be lower. Commercial Member Joined May 2017 3,332 Posts Now that the European Central Bank has saved the euro and our Federal Reserve has declared easy money as far as the eye can see, isnt the dollar going to get killed Well, on the surface that makes sense. But I think those concerns are short-term impacts. I still believe the dollar has entered a multi-year bull market, which began back in March 2008, when the U. S. dollar index bottomed. Now that the European Central Bank has quotsavedquot the euro and our Federal Reserve has declared easy money as far as the eye can see, isnt the dollar going to get killed And here are nine themes I see playing out that would ensure a bull market for the dollar: Theme 1Euro no longer a viable challenger against the dollar The euro is not saved yet, by any means. I expect another crisis to rear its ugly head within the next six months or sooner. But even assuming the euro is quotsaved, quot I would expect at least a decade of deflation and slow growth. As a result, the euro will fall of its own weight relative to the dollar and other major world currencies. Theme 2 Most of the monetary policy impact is behind us Each of the Feds new programs has been increasingly less effective in helping the real economy. Sooner or later the market will clear itself. And when it does the Fed will quickly take back all those excess reserves, which means U. S. dollar supply will fall. Therefore, fewer dollars will be out there as demand grows with recovery. Theme 3 Chinas reserves are falling, and hot money is fleeing I expect this trend to continue as Chinas economic growth slips further. This again goes to the point of a declining global supply of dollars, which will be good for the dollars price. Theme 4 U. S. real assets look cheap In a world increasingly looking for good long-term investment ideas, U. S. real assets, including real estate and natural resources, look very competitive. This should lead to strong foreign direct investment into the United States. Indeed, good for the dollar. Theme 5 The ramp up in U. S. domestic energy production helps the buck There are two ways this is bullish for the dollar: 1) Falling oil imports should help cut our trade deficit and 2) It leads to more international investment into the U. S. by investors wanting to position accordingly. Theme 6 Global rebalancing taking place in China and Germany As the global backdrop for export dependent countries changes, the top exporters China and Germany will have to increase domestic demand in order to grow. This will likely help U. S. exports and be the real beginning of the long awaited global rebalancing. It will be dollar positive for sure Theme 7 Rising pool of U. S. domestic savings The credit crisis has triggered a palpable shift in U. S. consumer savingsconsumption patterns. I expect this to be secular in nature. As the U. S. pool of savings for domestic corporations increases, the dependence on international funding should fall. If the U. S. current account deficit improves dramatically, the dollar will benefit. Theme 8 Falling commodity prices As China decelerates, commodity prices should fall dramatically. This doesnt mean all commodities nor does it mean the secular rally is over. But over the next 1-2 years, this will put pressure on emerging markets and will likely mean U. S. investors keep more of their money onshore for local (U. S.) investment opportunities. That means more dollars staying home instead of being exchanged into other currencies. Once this mountain of cash is redeployed to fund technologies where U. S. companies have a commanding lead, such as in nanotechnology and 3-D printing, it could virtually trigger a U. S. renaissance and would be a magnet for foreign direct investments. That would be very dollar bullish. Theme 9 2 TRILLION in U. S. corporate cash on the sidelines Needless to say the ideas Ive listed above have implications for asset markets that go way beyond the U. S. dollar. Over the next several weeks I will pick up on each of these themes in greater detail to show you why I believe its way too soon to write off the dollar or make a long-term bet on the decline in America. Commercial Member Joined May 2017 3,332 Posts Why the yen could be todays best currency trade by Jack Crooks Saturday, June 9, 2017 at 7:30am The Japanese yen continues to defy its own economic fundamentals. It continues to move up and down in value, in correlation with quotrisk offquot (stocks and growth assets moving lower) or quotrisk onquot (stocks and growth assets moving higher). But the latest statistics and dynamics driving the Japanese economy into the future still tell me the yen will weaken in a very big way, sooner or later. If you are a long-term player who has some patience, I consider this the best single trade setup among the major foreign exchange pairs: A core long-term long position in USD (U. S. dollar)JPY (Japanese yen). In other words, bet that the yen will fall in relation to the dollar. Of late, the yen (relative value) is moving in tight, negative correlation with risk assets. Using the Dow Jones Industrial Average (DJIA) as a measure of risk assets, you can see that as the Dow falls, the value of the yen rises. On the chart below, the USDJPY falls as the yen gets stronger relative to the U. S. dollar. Whether you consider the yen correlation against the DJIA or the Nikkei 225 Index, it is effectively the same concern in global stock markets means the yen strengthens. The primary reason is simple repatriation. Japan is still a very wealthy country despite the economic calamity experienced since the bubble broke back in 1989. Its insurance and pension funds have vast amounts of investment capital. When things get ugly globally, measured by stock markets, these big pools of funds tend to rush back home to hide in local Japanese government bonds for safety. For example, consider the relationship between the DJIA and USDJPY going back to the credit crunch period beginning in mid-2007: DJIA down 15.2 percent from its peak USDJPY down 35.9 percent from its peak Dollaryen has fallen 35.9 percent, or put another way the yen has strengthened 35.9 percent against the U. S. dollar since the credit crunch (creating huge price pressure on Japanese exporters) while stocks rose. And when you consider that one of the major impacts of the credit crunch was the decline in global demand for goods from export-oriented countries, such as Japan and China, you can see why Japanese companies are screaming for relief from this double whammy of pain. Japans Soaring Government Debt Crisis The dangers of a declining trade surplus and strong yen pressures are put quite clearly into context when you understand that Japan will likely run a fiscal deficit of a whopping 10 percent of GDP. Meanwhile its debtGDP ratio could rise to the moon-launch level of 241 percent (roughly twice the level of Italy) this year, according to forecasts by the International Monetary Fund. Notice in the chart below how government debt has continued to ramp up after the bubble broke in 1989. And this fits the view gaining ground that after Mr. Market is done crushing the European bond market, it turns its guns on Japan. Now, what makes that picture even worse is the train-wreck scenario of Japan no longer being able to fund these huge debt needs internally as the pools of private and business savings are drying up. In other words, if Japanese interest rates rise from their incredibly low levels 0.89 percent on the 10-year Japanese Government Bond (see chart below) the cost of funding with 200 percent debtGDP could shoot up exponentially. If Japans bonds begin to reflect real or even potential funding risk, forcing interest rates higher, it means that local demand from Japanese institutions will fall even more, putting greater pressure on rates, while the slowdown in economic activity will further reduce Japans available pool of savings to fund this growing need. Japan is facing a very scary situation here. Sooner or later, the yen will begin to reflect these internal realities. I think it will be sooner. When it does, the value of the yen has a very long way to fall (USDJPY has a very long way to rise). The long-term profit potential I see here is enormous. Best wishes, Jack Thursday, October 25, 2017 at 7:30am China has been one of the worlds worst performing stock markets in 2017, down 14 percent from its March high. Persistent worries about the health of Chinas economy have dragged stocks lower. But over the past month, stocks in Shanghai have perked up a bit. And recent upbeat economic data has many investors asking if growth in China may finally be rebounding after a seven-quarter slowdown. The answer to this question could determine if emerging markets in general 8212 and especially in Asia 8212 may enjoy a reversal of fortune leading global stocks higher once again. One thing is for sure: Investor sentiment toward China has been pervasive in recent months. Confidence Is Returning As quarterly GDP growth fell steadily for the past seven straight quarters, confidence turned sour. And investors pulled capital out of China and U. S.-listed ETFs and mutual funds that invest in China. The financial media went from debating whether China would experience a hard - or soft-landing. to predictions of an imminent crash-landing. Chinas official economic data has always been considered suspect. As if U. S. data, often subjected to sizeable revisions after-the-fact, are any better. That said recent data out of China for September turned decidedly more upbeat: 8226 September retail sales expanded at a 13.2 percent clip 8212 the strongest pace this year 8212 indicating Chinese consumers are spending. 8226 Disposable income for Chinas city dwellers is growing nearly 10 percent. And rural disposable income jumped more than 12 percent so far this year. 8226 Fixed asset investment, a key indicator of overall capital investment, surged 20.2 percent year-over-year in September 8212 to the highest level since October 2017 Also, September industrial production grew at a 9.2 percent pace, while exports were up 9.9 percent, well ahead of estimates. Meanwhile, strong growth in capital investment is being led by a pickup in domestic infrastructure projects like highway, seaport, rail, and airport investments. These are key elements of Beijings economic stimulus announced earlier this year as leaders attempt to shift the focus of Chinas economy away from an export-led growth model to focus more on domestic consumption. But it isnt just the government providing growth. Capital spending by Chinese private sector firms has risen faster than state-owned enterprises for 30 of the past 31 months And consumption growth is likely to pick-up even more in the months ahead, not only because disposable incomes are rising at a fast pace, but also because inflation remains subdued. Follow the Money Chinas consumer price index moderated to 1.9 percent in September down from 2.2 percent in August. This gives the Peoples Bank of China more room to maneuver in further reducing interest rates and lowering bank reserve requirements to stimulate more lending growth. In fact, Chinas money supply growth has risen sharply this year, expanding at a 14.8 percent clip year-over-year in September, up from 12.4 percent at the end of January 2017. Thats a very bullish sign given the high correlation between money supply growth and Chinese stock prices. And following several months of outflows there are signs that money is flowing back into China again. What really caught my eye was a report that the Hong Kong Monetary Authority was forced to intervene in foreign-exchange markets this week for a second time to prevent the HK dollar from appreciating against the U. S. dollar. After another round of money-printing by the Fed, European Central Bank, and Bank of Japan, investment funds appear to be flowing into Hong Kong at a rapid pace, given its status as the main investment gateway into China. That puts upward pressure on the HK dollar which is pegged in a narrow range to the buck. This is important because its the first intervention since 2009. the first time since the financial crisis that capital flows into China have rebounded to such a significant level. Im a true believer in following the money in global markets. Tracking block money flows into and out of markets, ETFs, and individual stocks can provide important clues about where the big money is moving to take advantage of investment opportunities. Emerging market equity funds have posted six straight weeks of capital inflows through the week ended October 17, bringing inflows to more than 21 billion year to date. And China equity fund inflows recently hit a seven-week high. I track similar money flows into ETFs using Bloomberg market data. And sure enough I noticed significant flows into China-related funds over the past several months including: 8226 iShares FTSE China 25 Index ETF (FXI), with 136.2 million inflows. 8226 iShares MSCI Hong Kong Index ETF (EWH), with inflows of 82.3 million, and. 8226 Morgan Stanley China A Share Fund (CAF) with a 3.7 million inflow This sudden reversal of money flows isnt limited to China either, or just to these funds. Several others that track China and other emerging markets are seeing strong capital inflows too, which makes perfect sense when you think about it. China is the worlds largest consumer of many commodities these days. everything from aluminum to zinc. So a pickup in Chinas growth should mean better prospects ahead for markets like Australia, Canada, Brazil, and Chile. Meanwhile, about 80 percent of Chinas imports come from Japan, South Korea, and Taiwan, so stronger Chinese domestic growth and export growth should benefit these markets as well. Bottom line: It may be premature to call a bottom in the Chinese stock market. But a sustained turnaround in Chinas economy should lead to stronger performance in many other global markets too. Good investing, Mike Burnick Commercial Member Joined May 2017 3,332 Posts You may recall my Money and Markets column, Why the yen could be todays best currency trade. Today I want to give you an update on why I believe we are very close to a long-term peak in the value of the Japanese yen. Or to put it another way a major long-term multi-year bottom in the U. S. dollar. Lets first go back to the 1980s when Japan was poised for what many believed was inevitable economic domination. The country was in the midst of a huge credit bubble valuations were off the charts. For example, in 1989 the Tokyo Imperial Palace was said to be worth more than all the real estate in California The countrys trade balance was soaring against the world, especially the United States. Japanese companies were gobbling up real assets throughout the globe. Here in the U. S. the premiere properties acquired were Pebble Beach Golf Course and Rockefeller Center. Americans were concerned, very concerned about this foreign invasion. And Japan bashing was in vogue. During the early 1980s the U. S. dollar was in a major bull market. Despite the real value of the dollar and other fiat currency values inflating away, the dollar staged a rally of almost 50 percent from its low in 1980. Paul Volckers tough love administered by a massive hike in interest rates, was the catalyst of this multi-year rally. With Japan the big dog on the block and its trade surplus soaring, U. S. manufacturers and other trade groups began applying pressure for a dollar devaluation the dollar was too high. So the major global powers jumped into action to rectify this terrible wrong. The United States, the United Kingdom, France, West Germany, and Japan got together at the Plaza Hotel in New York and agreed that the dollar was too high. The Plaza Accord or Plaza Agreement was signed on September 22, 1985. In short, the countries agreed to allow their respective central banks to intervene in the foreign currency market through a coordinated effort to push the U. S. dollar down. Though at the time billed as a dollar problem, the implicit rationale for the Plaza Accord seemed a defense against Japans rising trade surplus. Thus it was more of a push up the value of the yen agreement. Many, rightfully, believed Japans aggressive export-dominated trade policy took advantage of relatively open markets in the West by producing increasingly high-value goods and morphing up the consumer value chain. But at the same time it continuously found a way to stop or delay Western goods from making it to Japanese consumers. As I said, the Plaza Accord worked in pushing up the value of the yen. But it did little to solve the trade balance problem. Japans trade surplus remained strong even as the yen soared. In the chart below I have compared Japans trade surplus on a monthly basis with the yens value from 1983 through June 2017. I noted the Plaza Accord and the official Credit Crunch start by the red vertical lines. Think of them as bookends on the massive rally in the yen. Here is where it starts to get interesting if, like me, you believe the USDJPY is close to a major long-term bottom The way I see it, the real trigger that changed the dynamics for Japans seemingly unending trade surplus was the Credit Crunch. Thats because the Credit Crunch brought an end to Japans long string of trade surpluses I also believe it triggered the beginning of the end of the Asian export model as we know it. I see three major reasons, which are interrelated and self-reinforcing: First . it marked the end of an era of unlimited global liquidity Second . it triggered a secular change in global consumption And third . more specifically Approximately 90 percent of Japanese debt is held by Japanese investors. Over the years, huge pools of savings and massive current account surpluses have provided plenty of money to fund the Japanese governments growing need for funds as tax revenues were increasingly scarce given Japans low growth deflationary economy. But now, Japan faces a daunting prospect thanks to the Credit Crunch. No longer is it generating the current account surplus it needs. Consumer demographics and low growth have pushed the consumer savings pool sharply lower heading toward zero. And companies domestically have been using their savings pools to recover from the Tsunami and plug the holes from falling demand for their exports. Therefore, the Japanese government is at risk of a funding shortage at least internally. And this is very dangerous. Heres why Japan has a government debt-to-GDP ratio of around 215 percent. The interest cost to fund this debt is huge. Plus the yearly funding needed to maintain government services is massive. Add them up and you get a mismatch between government revenues and spending. Its called a budget deficit, and here in the U. S. we know firsthand how that works. Next, take a look at the chart below. Presently the yield on the benchmark 20-year Japanese government bond (JGB) is 1.7 percent. In fact it has hovered around this level since 1998. 20-year Japanese Government Bond Yield vs. the USD-Japanese yen 1990-today If Japan does not have the internal funding available to handle its needs, it will have to look to international investors for this funding. So Japan is faced with a triple-whammy of pain: 1) Rising funding needs, 2) Falling internal sources of funding, 3) Rising funding costs because foreign investors will expect a much higher yield than 1.7 percent to account for the risk of holding Japanese debt. Because Japan is facing this triple-whammy with an already astronomical debt load, this mix of problems will likely lead to a vicious self-feeding spiral. Then higher interest rates will lead to higher funding costs and falling bond prices will lead to dumping of bonds, which leads to higher yields to entice new buyers. I believe we are seeing the outlines of what might eventually become a Japanese government bond default as the sovereign debt problem visits Tokyo. My suspicion is that once the markets are finished attaching the euro-zone bonds, they will train their guns on Japan. To sum it up, a change in the global economy and the outlines of a sovereign bond crisis in Japan suggest to me that we must be very close to a major trend change for the Japanese yen. Best wishes, Jack Commercial Member Joined May 2017 3,332 Posts The Land of the Rising Sun is Shining Brighter By Sean Hyman, Editor of Currency Cross Trader Sometimes in life it can seem like when something has been a certain way for a very long time that it will always be that way. It8217s like the brain has a tendency to get conditioned to a situation and decides it will always be that way. Well, investors get the same way about a stock or index that8217s been out of favor for a long time. They can never seem to imagine a day when it will come back. Take, for instance, Japan8217s Nikkei index. It8217s been down for over two years in a row, even as most other stock indices have rebounded. But actually, you can look further back to the larger trend and see that Japan8217s Nikkei was one of the first indexes to top out. The Nikkei topped out in early 2006, while most other stock indexes topped out at the end of 2007 or early 2008. So, the Nikkei has really been trading lower for about six-and-a-half years. Well, you can see where it would be easy to get sucked into the thinking that those stocks are never coming back. However, it8217s simply not true. There are a couple of things changing that are going to set up the Nikkei for its first real rally in years. A Change in Direction for the Yen The first thing is the change in the yen. You see, the Japanese yen has been strengthening in a big way ever since July of 2007, and it finally peaked in October of 2017 but traded somewhat sideways through January of this year. From that point, the yen has begun to descend. In fact, let8217s take a look at the Nikkei in the weekly, three-year chart below with the Japanese yen plotted below it. Why is the fall of the yen important Japan8217s Nikkei is filled with major exporters such as Toyota, Honda, Mazda and Sony. From the viewpoint of an exporter, you want a cheap currency. If your goods appear to be cheaper because a foreigner8217s money goes further, then they are more apt to buy more of your products. However, if your currency is stronger, your products will appear more expensive to foreigners and you8217ll sell fewer. So what the currency is doing is a big deal. It8217s one of the determinants of how well these companies will do. In other words, when dealing with a strong yen, they have the wind in their faces, and when they have a falling yen, these companies finally get the wind to their backs. If you8217ve ever ridden a bicycle in the wind, then you know it makes a big difference whether the wind is with you or against you. It8217s the same with these companies. With absolutely no other changes, their performance and results will vary widely depending upon the value of the yen. What Stimulus Means for the Yen The other thing that has changed in the favor of the Nikkei is that Japan has instituted an 8220asset purchase program.8221 A pretty sizable one at that 8230 to the tune of 80 trillion yen. Then, on Friday, Japan announced 750 billion yen (9.4 billion) of stimulus to boost growth. The measure was undertaken after bond dealers concerns over government spending raised fears of a disruption at a December debt sale. This will be good for Japan8217s stocks for now and bad for its currency. So between the stimulus programs and the change in the direction of the yen, Japanese stocks have a chance to reverse course for the first time in over six years. With that in mind, let8217s look at an ETF that tracks Japanese stocks. It8217s called the Wisdom Tree Japan Total Dividend ETF (DXJ). Let8217s check out its daily, two-year chart below. Declines in the Yen Can Be the Catalyst for Huge Moves in Japanese ETFs Going into 2017, the yen took a tumble and Japanese stocks got their first good shot in the arm they8217ve had in a long time. Now, the yen is beginning to fall off the map again and DXJ is breaking out of its triangular coiling consolidation. I believe this sets up DXJ to where it could head to 36 per share or higher over the next two to three months. This means the stock could move a whopping 11 within that very short time if the yen keeps falling as I believe it will. So check out DXJ. I believe it8217s primed for its next launch higher and it8217s going to catch the masses off guard. They8217re going to wonder where this rally came from. But you8217ll know that it8217s come from the new stimulus and from the change in the direction of the yen. Have a nice day Sean Hyman Editor, Currency Cross Trader Joined Oct 2017 Status: Member 4 Posts Many thanks for your description of the triple screen trading strategy. As a noob I began researching simple strategies that utilized only one indicator alongside EMA. They seemed to work okay but my dilemma was that I didnt have enough confidence entering the trade with analysis from just one indicator and a few supportresistance lines. It was when I began looking into trading systems that utilized a few indicators to reveal an overall meaningful picture, that I discovered Elders Triple Screen Strategy. The following link is a PDF to the section of Elders book, Trading For A Living, where he explains the strategy in detail, screen by screen: trading-nakedlibrary. ingsystem. pdf As of now Im using the FXCM web trading system, but hope to get metatrader4 very soon - just need to install windows on my mac As you may already know, this platform is limited in terms of customization and availability of indicators - between Williams R and Stochastic, Ive decided to use the latter for my oscillator so that I can focus on strong signals and avoid being swayed by market noise. Elder doesnt talk much about interpreting Stochastic here, so I appreciate your extended explanation about this. My three screens are as follows: large: 3 Hour (MACD EMAs (see below) intermediate: 30 min. (Stochastic) small: 5 min In my 3 hour chart Im also using 13EMA, 28EMA and 53EMA. Ive noticed that the size of the MACD histogram bars can give hints about the strength of 13EMA movement and its likelihood of crossing the other two EMAs and flipping the direction of the trend. As histogram bars get longer, the momentum of 13EMA seems to get stronger, which may signal a change in trend. Im just about ready to employ this system on my own for the first time. Looking forward to having a greater sense of confidence in my trade decisions Members must have at least 0 vouchers to post in this thread. 1 trader viewing now Forex Factoryreg is a registered trademark.