Shares Liquidity & Strength Of The Trend

This is a discussion on Shares Liquidity & Strength Of The Trend within the Technical Analysis forums, part of the Methods category; Does anyone has an idea how to gauge THE SHARES LIQUIDITY and THE STRENGTH OF THE UP/DOWN TREND as this ...

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Old Oct 26, 2006, 9:29am   #1
Joined Feb 2005
Shares Liquidity & Strength Of The Trend

Does anyone has an idea how to gauge THE SHARES LIQUIDITY and THE STRENGTH OF THE UP/DOWN TREND as this site does?

Please help! Thanks in advance!
z482493 is offline   Reply With Quote
Old Oct 26, 2006, 10:33am   #2
Joined Mar 2003
If I was going to measure a stock's liquidity and trend strength, I would probably just look at average daily Trading Volume, DMI and ADX. They should give you a reasonable idea of liquidity, trend direction and strength of the trend in that direction.

The site you mention may be using their own custom proprietery calculations to come up with those trend figures.

Have you tried emailing the site's vendor?


Thanks

Damian
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Old Oct 27, 2006, 10:25am   #3
 
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Joined Apr 2006
Maybe this approach might suit better?

1) What is the current trend - Up or Down
2) Has the Daily Volume increased
3) Is the OBV moving in the same direction as the price
4) Is the Money Flow moving in the same direction of the price

And last, but not least - WHAT DO I WANT TO DO ?
1) Invest in the stock
2) Swingtrade the stock
3) Daytrade the stock
4) Scalp the stock

Have a look at the Daily charts and Tick Charts for the 2 stocks.

The first stock is KBAY - the one at the top of the list on your Turtlesignal site.
The second stock is GMT - a member of the Dow TRAN index.

Which one do you think offers the following:
1) Consistent daily volume
2) Good ADR - Average Daily Range
3) Best chart formation for trading

All trading decisions are based on 5 simple pieces of information - OHLC & Volume

Using math models to predict the optimal entry and exit prices - is IMHO - about as effective as throwing darts at the newspaper cut out.

A chart can convey much more information than numbers can ever do - so learning to use charts based on what way you want to trade, may be a wise approach to take.

Trading any stock that is not a member of a well know index - is to say the least - high risk.
If you want to place high probability trades -then you must take a top down approach - look at what sectors are in favour - know the Tier 1 & Tier 2 stocks for that sector - determine WHAT YOU WANT TO DO as above, and then demo trade until you see it working, then you can start to place live money on the table.

System trading is for the long term investor - and with all system trading every signal must be taken in order for the averages to work. This can mean large drawdowns, based on your % risk
level.

So, it may be wise to first of all know exactly WHAT YOU WANT TO DO, and then find out if you can do it?

Regards,
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