RE: UK Stocks - Watchlist and Discussion
(2014-02-16, 12:43 AM)isatrader Wrote: One thing I'd suggest to adjust on your charts if you can, is the addition of the 52 week MA on the relative performance indicator, as this is what I refer to as the "zero line" as it's what's used for the Mansfield RS zero line, which you can see in the examples in the book. It's very important to have this, as I've found the angle of the relative performance 52 week MA is very important in determining whether a Stage 2A breakout will be successful or not i.e. the strongest breakouts occur when the relative performance line breaks above a flattening or rising 52 week MA (zero line), and I also recently emailed Stan about it, and he confirmed what I thought. So I'd recommend that you include it as I think it's an important component of the method.
OK, this leads to another question, and just so that I'm clear..
I've attached the RS chart against S&P and against its overall market, FTSE
The link about its calculation uses a simple average whereas the mansfield chart uses a weighted according to the book.
I've attached the same simple and weighted, red and blue respectively
The RS zero (compared with the FTSE, bottom half window) is now flat on the weighted and above zero
Your chart in your reply uses the RS against the S&P and now both the weighted and simple are declining and below zero (only just..possibly at zero with weighted). top half chart window above
If the S&P is in stage 2, and the FTSE in stage 3, then the RS is going to be different. I respect the fact that they are correlated, and the S&P will often drag the FTSE with it but should we be comparing RS with the S&P all the time, or was this just an oversight?