An invaluable momentum indicator to me is the hitting new highs/lows ticker. Real Tick calls it a TAL Alarm. Your trading platform should have a similar one. I have one for NYSE, QQQQ and stocks on my watch list.
I can set the filters to display any price range of stocks. As you can see from the photo it displays new highs and lows in a real time dynamic basis. The number of times a new level is reached today and 52 week highs and lows are shown with the price colour coded.
Aside from mining many opportunities from this indicator I use it to tell me the cycle of momentum. Used in conjunction with the 5 minute charts of the S&P and QQQQ it clearly gives the health of markets and tipping points of momentum.
Strong/weak stocks leading the markets higher or lower setting new prices in that direction give me an excellent visual of what is happening.
When the markets are trending strongly these tickers are scrolling rapidly by. They slow as momentum slows. They change from green to red as the markets do. 50, 70 or 100% green or red is a very telling story of momentum.
I don’t need to look at them in detail. Most times I can see what is happening in my peripheral vision and absorb the market direction information. If a block of new prices appear for a stock(such as FSLR shown here), it grabs my attention so I can click on that and the charts for that stock comes up.
Trading the new high/lows is a great way to trade with the trend and momentum. I never think a stock is too extended or beaten down to buy or short. The fact that it is still going up or down is enough for me to jump aboard.
To see this in action click here http://fearandgreedtrader.blogspot.com/2010/02/good-shorting-today.html#links
Posts
4 comments:
Scott, can you recommend a good site/platform that displays real-time chart data? My broker is currently Sogotrade, and while I like them so far I find that their charts are about 15 min delayed. Google finance does have real time chart data, but it's often hard to read the candles there.
Started doing a few paper trades today with the idea of momo in mind, and I must say it's so much easier than trying to keep news/charts/opinions on stocks in your head at the same time. This morning I rode some momentum on ACAD from 4.69 to 5.02, then have shorted it since 4.78 (its 4.59 as I type) I know one stock doesn't prove the method, but my mind has been much more at ease while trading, even if it's a small stock or gain.
-Chris
I use Realtick now and have used Cybertrader in the past. Other that that I can't recommend anything to you. Probably best to do a search and see what turns up.
To day trade you must have a realtime feed.
Feels good to free your mind doesn't it?
Scott:
Don't know if you remember me or not, but I am sure Stewie can tell you about me if you need to know. I also use Realtick...was wondering if you could send me your page file as I would like to see what information and charts you follow. Will do the same for you if you are interested. Thanks,
MJ
montrealjain@yahoo.com
jain- I detailed my screen set in my post "My set up" under the best of blog column. I tells you exactly what I am looking at.
Post a Comment