+- Stage Analysis Forum - Trading & Investing using Stan Weinstein's Stocks Breakout method (https://www.stageanalysis.net/forum)
+-- Forum: Main Board (https://www.stageanalysis.net/forum/Forum-Main-Board)
+--- Forum: Stan Weinstein's Stage Analysis - Stock Charts, Technical Analysis, Learn to Trade, Stocks, ETF, NYSE, Nasdaq (https://www.stageanalysis.net/forum/Forum-Stan-Weinstein-s-Stage-Analysis-Stock-Charts-Technical-Analysis-Learn-to-Trade-Stocks-ETF-NYSE-Nasdaq)
+--- Thread: Stage Analysis Beginners Questions (/Thread-Stage-Analysis-Beginners-Questions)
Pages:
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
101
102
103
104
105
106
107
108
109
110
111
112
113
114
115
116
117
118
119
120
121
122
123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139
140
141
142
143
144
145
146
147
148
149
150
151
152
153
154
155
156
157
158
159
160
161
162
163
164
165
166
167
168
169
170
171
172
173
174
175
176
177
RE: Stage Analysis Beginners Questions - mkoza - 2022-09-18
Hello,
I'm going through all your videos, marking up the charts as you are for practice and to study and you threw a curve ball at me.
Am I interpreting this correctly?
Normally, you would have just drawn out the SC and AR. BUt in this case you added another resistance line. I'm assuming you did that simply because it was there, and so close? Otherwise, the SC and AR would have been it. Does this make sense?
RE: Stage Analysis Beginners Questions - isatrader - 2022-09-18
(2022-09-18, 01:43 AM)mkoza Wrote: Hello,
I'm going through all your videos, marking up the charts as you are for practice and to study and you threw a curve ball at me.
Am I interpreting this correctly?
Normally, you would have just drawn out the SC and AR. BUt in this case you added another resistance line. I'm assuming you did that simply because it was there, and so close? Otherwise, the SC and AR would have been it. Does this make sense?
Mostly, I'll only highlight the SC and AR, but if there are other levels that are significant, then I'll show them too.
So why is that level significant. It's because the price has stopped in the relative zone around it multiple times, i.e. it's acted as support or resistance. So that gives it more significance as a level of interest, and because it marks the most recent points of resistance. As it stopped there twice.
RE: Stage Analysis Beginners Questions - mkoza - 2022-09-18
thank you
RE: Stage Analysis Beginners Questions - ferran - 2022-09-18
Hi David,
I wanted to ask your experience with MA types. I see you're always using SMA's. Do you have any objective reason for that? Eg did you ever backtest performance when using SMA vs EMA?
I've always naturally felt like using EMA's, because MA is already a lagging indicator and with EMA you at least add more weight to the latest candles and hence reduce the lag. SMA (especially the long term ones) just seem so slow to turn. To be fair, I've never done a proper backtest between those MAs in my strategy.
While we're talking about backtesting, another question pops in to my head; What is your avg win rate using your strategy?
I'm using stage analysis as a part of my strategy and want to see if I'm going in the right direction. I especially see that I can improve in my trade execution. It would therefore be great if you could also in any future videos spent a bit more time explaining in more detail how you go from analysis to execution. In the last video you did give an example of performing SA on a lower timeframe to detail out entries, which I really liked.
RE: Stage Analysis Beginners Questions - isatrader - 2022-09-18
(2022-09-18, 01:55 PM)ferran Wrote: I wanted to ask your experience with MA types. I see you're always using SMA's. Do you have any objective reason for that? Eg did you ever backtest performance when using SMA vs EMA?
The method is completely discretionary and mostly manual, so backtesting would be very difficult, as beyond coding the stages, which no one has done accurately as yet, although many have tried, there are multiple external factors beyond the individual stock chart that need to be considered at the same time before making a trading decision, as the decision to enter can't be made on the stock chart alone. So like technical analysis it's more of an art than a science, and every single person will trade it differently. As it not a mechanical system.
I've spoken to literally thousands of people over the last 13 years about the method since I started the discussion threads on another site, before moving it here, and the common theme is that every single person adds their own style to it from knowledge that they have or acquire elsewhere in their trading journey. I could teach 100 people the exact way that I do it, and they would all do it differently than I taught. It is just the nature of people.
The moving averages play an important part for me in helping to identify the Stages, as for example for a stock to move into early Stage 2 the price needs to above a rising 10 week SMA, plus rising 30 week SMA, and the 10 week SMA should be above the 30 week SMA, as well as just being above the 200 day SMA – which doesn't have to be rising.
If you use EMAs or Weighted MAs, you can get whipsawed more, as encourages earlier entry in newer traders to the method. But as you get more experienced with the method you'll find that the type of MA that you use doesn't matter as much, and it's possible to not have any moving averages showing and still determine the Stages just the same. As you still should be considering all of the other of the other important factors as well, including those not on the chart itself, such as group strength and the market breadth, which to me are the most important things.
So don't get to bogged down in it. Use whatever helps you to see the Stages accurately.
I use the 10 week SMA and 30 week SMA on the weekly chart, and 21 day EMA, 50 day SMA and 200 day SMA on the daily chart. As this combination is enough to see at glance when scanning through charts quickly, the short, medium and long term position, and determine the Stage very easily. But it took looking at a lot of charts every day before it became easy to see.
(2022-09-18, 01:55 PM)ferran Wrote: While we're talking about backtesting, another question pops in to my head; What is your avg win rate using your strategy?
I would say that my average win rate has been under 50% over the years, but that generally my losers have been much smaller than my winners. So the equity curve has been rising over the years, but it's certainly not been a straight line. And even to this day, I still suffer from making occasional impulse trades that break my rules (not the methods rules), as like I said, everyone adds their own style to it, which in my case is the addition of techniques from multiple sources, such as Dorsey, Minervini, Elder, Wyckoff etc.
RE: Stage Analysis Beginners Questions - Mashed - 2022-09-20
Hi guys,
I saw this chart here in a video. And looks pretty well, but...don't you think this kind of chart in a complicated moment like this could be a dangerous trade?
If you finally decide to get in, how do you manage the stop loss? Tighter than usual?
Thanks
RE: Stage Analysis Beginners Questions - isatrader - 2022-09-20
(2022-09-20, 03:43 PM)Mashed Wrote: I saw this chart here in a video. And looks pretty well, but...don't you think this kind of chart in a complicated moment like this could be a dangerous trade?
If you finally decide to get in, how do you manage the stop loss? Tighter than usual?
It's been a very volatile one in the basing process, as it was a SPAC I believe from the way it pinned at the $10 level through 2021, with an Average True Range over the last year of 6.2% a week. So not the type of stock that I would trade personally, as I prefer much cleaner price action. But, it was highlighted because it is attempting to move out in early Stage 2 on increased volume. So the next entry point in the method would be on a backup towards the Stage 2 breakout level on contracting volume and price spread, that then doesn't fall back into the range and turns back up again with expanding volume once more.
The stop loss should reflect the volatility of the stock imo, as it needs enough room to not whipsaw you out of the position just on its normal price action. But you can use tighter stops if using the lower timeframes to enter, as you can swing trade into it on intraday charts, and quickly move stops up on progress, and then build on the position. Or another approach is to use small position sizes to build the position gradually via multiple entries and using with more normal stop loss positioning. Which then limits the risk due to the smaller size initially.
RE: Stage Analysis Beginners Questions - ferran - 2022-11-06
Hi David,
I'm currently screening for the market status and updating my watchlist mainly in the weekends and then monitoring the list daily (typically after the close). Due to my job, I dont have a lot more time to do it differently. I think Stan W would label me an investor
One thing I'm struggling with is that even when, say selecting the top performing sectors (eg SCTR score >90) and the best stocks, I still end up with a lot of stocks and have difficulty on further reducing it to a manageable # of stocks. As a result, I'm jumping around quite a bit and this makes it quite difficult to manage my focus. I not seldom feel I (just) missed a good entry, because I was looking somewhere else.
Would you have any advice how I, "an investor", can deal with this practical problem?
Any recommendation on which posts from you I should focus on? Currently the weekend posts are my top interest.
Thanks in advance!