CANSLIM and Market Direction

[StevenXL]

Hello. I am new to trade2win, and have a question about CANSLIM. I have been reading the book, and recently read the Market Direction part of it.

WON puts a lot of stock (no pun intended) in volume, specifically when volume is above average.

Does WON ever say what the parameters of the average actually are? For example, am I looking at a 30 day moving average of the S&P 500, or am I looking at a 60 day moving average?

If you can answer this question, great! If you can point out to me where in the book I can find it, even better.

Thanks,

StevenXL

 

[bertilak]

I'm surprised this hasn't been answered yet!

On the the investors.com web site they show both weekly and daily charts.

One moving average is either 50 days or 10 weeks (both are the same time period) depending on if it is a daily or weekly chart. The other is either 200 days or 40 weeks.

I don't think the book is too clear on this, but if you look at the many charts that have commentary on them there is sometimes mention of the 10-week line.

You use the weekly charts to recognize patterns and this is what is most often shown. The daily chart can be used to help refine buy points (aka pivot points) and to look for daily info that is needed for some kinds of analysis (e.g. distribution days).

 

[StevenXL]

Thanks bertilak. This clears up a lot. I'm putting this information to work.