StockFetcher Forums · General Discussion · CONVERGENT STOCHASTIC THEORY<< 1 2 >>Post Follow-up
nikoschopen
2,824 posts
msg #40354
Ignore nikoschopen
1/17/2006 2:02:51 AM

jlmj,

The page I think you were implying, "The "Last" Stochastic Technique" (http://www.stockcharts.com/education/TradingStrategies/lastStochastic.html), talks about the practical aspect of using the Stoch(39,1). The interaction between Stoch(39,1) and Stoch(7,3), on the other hand, is solely my own invention (although calling it my own is somewhat disingenuous since I derived my knowledge from various sources).

Here's a synapsis of the Stoch(39,1) for those who might be interested:

"K39 - The Last Stochastic Technique"
A study published in "The Encyclopedia of Technical Market Indicators" found that some very good signals were given by an un-smoothed 39 period stochastic oscillator (K = 39, no signal line). A buy signal is generated when K crosses above 50% and the closing price is above the previous week's high close. Sell and/or sell short signals are created when the K line crosses below 50% and the closing price is below the previous week's low close. Taking a longer period, and not smoothing the data over a 3-period moving average allows the analyst to view Lane's Stochastic...

One last point to remember is that all stocks are unique, and while the 39 period Stochastic is a useful technical indicator, one should always map the performance against your specific stock. Recently, most Tech stocks have evidenced a tendency to signal entry at a K crossover above 40% and a sell with K crossing below 60%. However, in volatile equities a second price or sentiment indicator along with a volume indicator provides the best confirmation.


nikoschopen
2,824 posts
msg #40355
Ignore nikoschopen
1/17/2006 2:10:52 AM

[Edit]

Not not The page I think you were implying, but what you were in fact implying...
Sorry, I have a bad habit of skimming what others wrote (ahem, especially having read so many of Alf's posts <lol>...sorry, I couldn't resist).


EWZuber
1,373 posts
msg #40389
Ignore EWZuber
1/18/2006 12:44:59 PM

jlmj
This one looks for stocks that are testing support at a Weekly Chart MA.
I have screens for 25 & 50 WK.MA's as well. It is best to use this when the indices, SPX, COMP and DJIA are also testing weekly chart support in an oversold condition.

(Screen Name; OVERSOLD WEEKLY STOCHASTICS <50 NEAR 15 WK.MA.)
Show stocks where the Weekly Slow Stochastics(5,3) Fast %K is below 50
and close is near the Weekly MA(15)
and close is above the Weekly MA(15)
and the close is above .5
and average volume (30) is above 100000.


This next one just looks for possible bottoms;
(Screen Name; OVERSOLD WEEKLY & DAILY & CLOSE IS HIGHER THAN YESTERDAY)
Show stocks where weekly slow stochastics(5,3) Fast %K is below 25 and slow stochastics(5,3) Fast %K is below 25 and the close is greater than the close 1 day ago and average volume(90) is greater than 100,000 and price is between .5 and 15.

(Screen Name; WEEKLY +XOVER WITHIN LAST 1 WEEK $0.50 ~ $15.00.)
Show stocks where Weekly Slow Stochastic(5,3) Fast %K crossed above Weekly Slow Stochastic(5,3) Slow %D within the last 1 Week and Average Volume(30) is above 100000 and close is between 0.5 and 15.
and market is not OTCBB.

This one finds stocks that are finding a bottom on the weekly chart ahead of time so that entry plans can be made early;
(Screen Name; WEEKLY FAST & SLOW CONVERGING $0.50 ~ $15.00)
Show stocks where Weekly Slow Stochastic(5,3) Fast %K is approaching Weekly Slow Stochastic(5,3) Slow %D and Weekly Slow Stochastics(5,3) Fast %K is below Slow Stochastics(5,3) Slow %D and Average Volume(30) is above 100000 and close is between 0.5 and 15.00
and market is not OTCBB.

This one is a good all around stochastic based screen;
(Screen Name; OVERSOLD WEEKLY & DAILY & ABOVE 200 DMA)
SHOW STOCKS WHERE WEEKLY SLOW STOCHASTICS(5,3) FAST %K IS LESS THAN 25
and SLOW STOCHASTICS (5,3) FAST %K IS LESS THAN 25
and PRICE IS BETWEEN .5 AND 150
and AVERAGE VOLUME(30) IS ABOVE 100,000
and CLOSE IS ABOVE MA(200)
and market is not OTCBB.

On ALL these screens it is imparitive that the Monthly and Daily Charts (at a minimum) must be analyzed and the stochastic cycle phase relationships taken into account along with the proximity of MA's trendlines, support and resistance.


EWZuber
1,373 posts
msg #40607
Ignore EWZuber
1/23/2006 4:45:50 AM

Jack, you're welcome.


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