Crossing Point of Indicators
One of the safety rules of thumb good to keep in mind is about the crossing point of the Daily Model(golden) and the Intraday Model (brown).
Since the Intraday Model=Daily Model+Red Oscillator,
this crossing point means that the Red Oscillator is crossing the zero line. In general, longs are safer when Red is above the zero line (i.e. Intraday Model is above the Daily Model) and shorts are safer when Red has crossed below the zero line (Intraday Model is below the Daily Model). This is illustrated in the figure below showing the
bottom charts of NASDAQ Composite (COMP) at 9:45am today (7/19). Note how the COMP kept climbing up after the first crossing point (7/6) and direction changed after the second (7/14). COMP helps us with the general direction of the market and we can apply this rule of thumb to individual stocks as well.
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Since the Intraday Model=Daily Model+Red Oscillator,
this crossing point means that the Red Oscillator is crossing the zero line. In general, longs are safer when Red is above the zero line (i.e. Intraday Model is above the Daily Model) and shorts are safer when Red has crossed below the zero line (Intraday Model is below the Daily Model). This is illustrated in the figure below showing the
bottom charts of NASDAQ Composite (COMP) at 9:45am today (7/19). Note how the COMP kept climbing up after the first crossing point (7/6) and direction changed after the second (7/14). COMP helps us with the general direction of the market and we can apply this rule of thumb to individual stocks as well.
