RE: US Stocks - Watchlist and Discussion (Premium)
(2015-03-03, 12:54 AM)isatrader Wrote: The RS trend on Weinstein method charts is done using a 52 week MA on the RS chart versus the S&P 500. This is what we call the "zero line" as it's what is used to create the flat Mansfield RS zero line used in the chart examples in the book. See example here: http://stageanalysis.net/forum/showthread.php?tid=31
But on here we've been able to take the zero line concept further, as my studies have indicated that the angle of the 52 week RS MA is also critically important and must be either flattening or rising on the Stage 2A breakout, for the best probabilities of a successful breakout. However, if the 52 week RS MA is still declining, or the breakout occurs while still below the 52 week RS MA, then the probabilities of a failed breakout are much greater.
So the "zero line" I talk of in the RS of the charts is the one year moving average, and hence one year trend of the relative performance versus the S&P 500 and so gives you the same information as the P&F RS charts, as it filters out the noise of the daily RS moves.
Thanks for the link to the thread about the 'relative performance' Isatrader. Very interesting thread, well written and I think a correct way of interpreting!
Now I understand the concept of the 'zero line' you are using.
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Amedee
Pulling the weeds and watering the flowers (since 10/06/2015)...
Amedee
Pulling the weeds and watering the flowers (since 10/06/2015)...