Stage Analysis Beginners Questions

RE: Stage Analysis Beginners Questions

Hi all,
I finished reading Weinstein's book last month and had a question regarding identifying sectors or groups of stocks that are performing well for longs or performing poorly for shorting. What time span do you all use when identifying whether a sector/group is up or down? My trades are normally open anywhere from 1 week to several months. I typically swing trade on pullbacks. I have been use the 5-Day, 1 Month, and 3 Month time spans to check performance on stock sectors. At times, a sector may be up on the 5-Day time frame, but down on the other two and vice versa. What is your criteria or strategy for determining if a sector or group is up or down relative to your strategy?

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RE: Stage Analysis Beginners Questions

(09-03-2019, 10:57 AM)tentex25 Wrote: Hi all,
  I finished reading Weinstein's book last month and had a question regarding identifying sectors or groups of stocks that are performing well for longs or performing poorly for shorting.  What time span do you all use when identifying whether a sector/group is up or down?  My trades are normally open anywhere from 1 week to several months.  I typically swing trade on pullbacks.  I have been use the 5-Day, 1 Month, and 3 Month time spans to check performance on stock sectors.  At times, a sector may be up on the 5-Day time frame, but down on the other two and vice versa.  What is your criteria or strategy for determining if a sector or group is up or down relative to your strategy?

I've tried many different ways personally to determine this, but I settled on identifying the strongest sectors via my daily watchlist scans. As because the scans are based on volume, I can see where the money is flowing into the stocks which are breaking out and meet our other key criteria for the method, and so when I see multiple stocks from the same sector coming up in my scans day after day, then I know that that is the sector in which I want to be focusing on. i.e. the recent example of this would be gold and silver stocks, which have been in my scans regularly for over half of the year now. And if you follow other people that use stage analysis you'll have seen the same sector being mentioned over and over again in their posts.

isatrader

Fate does not always let you fix the tuition fee. She delivers the educational wallop and presents her own bill - Reminiscences of a Stock Operator.
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RE: Stage Analysis Beginners Questions

(09-03-2019, 09:12 PM)isatrader Wrote:
(09-03-2019, 10:57 AM)tentex25 Wrote: Hi all,
  I finished reading Weinstein's book last month and had a question regarding identifying sectors or groups of stocks that are performing well for longs or performing poorly for shorting.  What time span do you all use when identifying whether a sector/group is up or down?  My trades are normally open anywhere from 1 week to several months.  I typically swing trade on pullbacks.  I have been use the 5-Day, 1 Month, and 3 Month time spans to check performance on stock sectors.  At times, a sector may be up on the 5-Day time frame, but down on the other two and vice versa.  What is your criteria or strategy for determining if a sector or group is up or down relative to your strategy?

I've tried many different ways personally to determine this, but I settled on identifying the strongest sectors via my daily watchlist scans. As because the scans are based on volume, I can see where the money is flowing into the stocks which are breaking out and meet our other key criteria for the method, and so when I see multiple stocks from the same sector coming up in my scans day after day, then I know that that is the sector in which I want to be focusing on. i.e. the recent example of this would be gold and silver stocks, which have been in my scans regularly for over half of the year now. And if you follow other people that use stage analysis you'll have seen the same sector being mentioned over and over again in their posts.

interesting discussion. i'll give my 2cents. 
i've been backtesting this concept and my calculation is based on the same criteria that weinstein uses for the relative strength of the stock to the sector which is the 52week average of the mansfield relative strength
when i use the 52 week average of the sector to the index, to find the strongest relative strength of the sector, i am getting really great backtest results.
so my calcualtion, which is done weekly as per the investor method, i just use the exact same calculation as stan does for the stock

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RE: Stage Analysis Beginners Questions

(09-03-2019, 09:12 PM)isatrader Wrote:
(09-03-2019, 10:57 AM)tentex25 Wrote: Hi all,
  I finished reading Weinstein's book last month and had a question regarding identifying sectors or groups of stocks that are performing well for longs or performing poorly for shorting.  What time span do you all use when identifying whether a sector/group is up or down?  My trades are normally open anywhere from 1 week to several months.  I typically swing trade on pullbacks.  I have been use the 5-Day, 1 Month, and 3 Month time spans to check performance on stock sectors.  At times, a sector may be up on the 5-Day time frame, but down on the other two and vice versa.  What is your criteria or strategy for determining if a sector or group is up or down relative to your strategy?

I've tried many different ways personally to determine this, but I settled on identifying the strongest sectors via my daily watchlist scans. As because the scans are based on volume, I can see where the money is flowing into the stocks which are breaking out and meet our other key criteria for the method, and so when I see multiple stocks from the same sector coming up in my scans day after day, then I know that that is the sector in which I want to be focusing on. i.e. the recent example of this would be gold and silver stocks, which have been in my scans regularly for over half of the year now. And if you follow other people that use stage analysis you'll have seen the same sector being mentioned over and over again in their posts.

Thank you for your response.  I am using a simple scan looking for stocks that have the 50MA above the 200MA and at least 300K average volume.  I try to narrow this down to a sector that appears to be up by checking the sector or group on fidelity or another similar site.  

I typically miss out on trades that are in stage 1 due to my trading system looking for stocks that have broken out and are pulling back.   I have been buying on weakness... in other words, buying on pullbacks at areas of confluence, but I do like the idea of buying into strength at a Stage 2 breakout.  Do you all have any advice on scan criteria to be used to help you narrow down stocks that may be in stage 1 and about to enter stage 2 or stocks that are in stage 3 and about to enter stage 4?  Thank you again.

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RE: Stage Analysis Beginners Questions

(09-03-2019, 09:44 PM)malaguti Wrote:
(09-03-2019, 09:12 PM)isatrader Wrote:
(09-03-2019, 10:57 AM)tentex25 Wrote: Hi all,
  I finished reading Weinstein's book last month and had a question regarding identifying sectors or groups of stocks that are performing well for longs or performing poorly for shorting.  What time span do you all use when identifying whether a sector/group is up or down?  My trades are normally open anywhere from 1 week to several months.  I typically swing trade on pullbacks.  I have been use the 5-Day, 1 Month, and 3 Month time spans to check performance on stock sectors.  At times, a sector may be up on the 5-Day time frame, but down on the other two and vice versa.  What is your criteria or strategy for determining if a sector or group is up or down relative to your strategy?

I've tried many different ways personally to determine this, but I settled on identifying the strongest sectors via my daily watchlist scans. As because the scans are based on volume, I can see where the money is flowing into the stocks which are breaking out and meet our other key criteria for the method, and so when I see multiple stocks from the same sector coming up in my scans day after day, then I know that that is the sector in which I want to be focusing on. i.e. the recent example of this would be gold and silver stocks, which have been in my scans regularly for over half of the year now. And if you follow other people that use stage analysis you'll have seen the same sector being mentioned over and over again in their posts.

interesting discussion. i'll give my 2cents. 
i've been backtesting this concept and my calculation is based on the same criteria that weinstein uses for the relative strength of the stock to the sector which is the 52week average of the mansfield relative strength
when i use the 52 week average of the sector to the index, to find the strongest relative strength of the sector, i am getting really great backtest results.
so my calcualtion, which is done weekly as per the investor method, i just use the exact same calculation as stan does for the stock

Malaguti,
I like the idea of using the 52 week average of the sector to the index. Would you mind sharing more details on where you're able to find that information and how you are using that? What are some resources you all use that have sector indexes?

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RE: Stage Analysis Beginners Questions

Quote:Malaguti,
  I like the idea of using the 52 week average of the sector to the index.  Would you mind sharing more details on where you're able to find that information and how you are using that?  What are some resources you all use that have sector indexes?


i get the information from yahoo finance, using the ETFs for the sector
XLY,XLP,XLE,XLF etc
and then use the same calculation for the stock vs the index, i use the above for the stock against SPY
within amibroker it looks like this
RP = Close / Foreign( "SPY", "Close" ) * 100 ;
MARP = MA(RP,52);
MRP = (( RP / MARP) - 1 ) * 100 ;


so where RP is the stock's close i use first the stocks close against the sector
AMZN/XLY for example and then use XLY/SPY
two separate calculations gives me the strength of the stock and the strength of the sector

hope this makes sense
whenever i now run an exploration (scan) in amibroker it gives me the relative strength of each

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RE: Stage Analysis Beginners Questions

Hi! I'm currently going through the stage analysis study guide - questions and answers  and for the very first example, can you explain the placement of the resistance line? thanks in advance!

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RE: Stage Analysis Beginners Questions

(10-02-2019, 06:28 AM)yuriythebest Wrote: Hi! I'm currently going through the stage analysis study guide - questions and answers  and for the very first example, can you explain the placement of the resistance line? thanks in advance!

Hi yuriythebest, don't get too bogged down in the placement of the lines. They are just highlights of the near term resistance on the chart. As you are correct that it would still be a level of resistance. However, the purpose of the lines was just to show the Stage 2A breakout level - which can occur below older resistance. As when determining the Stage 2A breakout level, we look for the nearest significant high, which can sometimes occur below an older high like what you've highlighted.

isatrader

Fate does not always let you fix the tuition fee. She delivers the educational wallop and presents her own bill - Reminiscences of a Stock Operator.
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