Friday, August 10, 2007

Those pesky computerized trades vrs. day traders

I had in interesting lunch discussion regarding day traders vrs. computerized trading. Most day traders tend to respond to technical analysis later than computerized trading. For example, take the slow stochastic analysis method. A buy signal occurs when the pk line rises above the pd line. However, what causes this to happen in the first place, and how likely is it to happen? We can use the stochastic efficiency ranking that I mentioned in yesterday's blog as a ranking of likeliness. As for the causes, what if we ignore this question and look for points where this is very likely to occur, for example when the pd value has decreased for 12 consecutive days of more and when the pd's rate of change will be less than 1, as determined the the rate of change of acceleration of the values change. That's a mouthfull... These stocks would have been picked at close of day 8/9/2007:
ACTL, ACTEL CP (Google Yahoo Earnings Chart)
AM, AMER GREETINGS CL (Google Yahoo Earnings Chart)
BLC, BELO CORP (Google Yahoo Earnings Chart)
CENX, CENTURY ALUMINUM (Google Yahoo Earnings Chart)
CNW, CON-WAY INC (Google Yahoo Earnings Chart)
CPD, CARACO PHARMA LAB (Google Yahoo Earnings Chart)
GMTC, GAMETECH INTL INC (Google Yahoo Earnings Chart)
HEP, HOLLY ENERGY PART (Google Yahoo Earnings Chart)
HRAY, HURRAY! HOLDING C (Google Yahoo Earnings Chart)
IESC, INTEGRATED ELECTR (Google Yahoo Earnings Chart)
INFS, INFOCUS CORP (Google Yahoo Earnings Chart)
KLIC, KULICKE AND SOFFA (Google Yahoo Earnings Chart)
LSTR, LANDSTAR SYSTEM (Google Yahoo Earnings Chart)
LUFK, LUFKIN INDS INC (Google Yahoo Earnings Chart)
NPLA, INPLAY TECHNOLOGI (Google Yahoo Earnings Chart)
OKE, ONEOK INC (Google Yahoo Earnings Chart)
PROV, PROVIDENT FIN HLD (Google Yahoo Earnings Chart)
RAIL, FREIGHTCAR AMERIC (Google Yahoo Earnings Chart)
RBN, ROBBINS & MYERS I(Google Yahoo Earnings Chart)
ROSE, ROSETTA RESOURCES (Google Yahoo Earnings Chart)
SFY, SWIFT ERGY (HLDG (Google Yahoo Earnings Chart)
SIM, GRUPO SIMEC SAB A (Google Yahoo Earnings Chart)
SSCC, SMURFIT-STONE CON (Google Yahoo Earnings Chart)
SUG, SOUTHERN UNION CO (Google Yahoo Earnings Chart)
TFX, TELEFLEX INC (Google Yahoo Earnings Chart)
WYN, WYNDHAM WORLDWIDE (Google Yahoo Earnings Chart)

If one were to purchase $1000 of each stock without going over $1000 including a $14 fee per trade, the total cost of stocks would have been $26,385,73 These stocks made a profit of 3.0% in one day. I'll continue to monitor stocks on this scan and likely trade one or two every now and then.

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