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If the 3:13 & 39 MAs are close and converging before crossing over you are likely dealing with an intermediate (or significant) correction of the trend or reversal.
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Date Posted: 27/09/03 12:47:12pm
In reply to:
By the build up from 96c dated the 25/9/03
's message, "Opinions on ERG trading aspect sought A 1 dollar valuation has been obtained dated the 25/9/03." on 27/09/03 12:35:31pm
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ERG--2 large brokers upgraded ERG July16
2 large brokers upgraded ERG July16
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61.8% retracement with upper figure at 118 16/7 and the 17/7/03--and the lower figure of 73--25/6/03 equals 91.81 92c rounded.--a difference of 45c--50% retracement =95.5 38.2% retracement equals 100.81 Lowest fig seen intraday 94---17/7/03 Note high and low for 17/7 97--to 118---20/2/03--12/3/03 82.5% retracement vwap's 9.3 16.53 - 8.8.5 8.03 x 82.5%=9.3----Noted the 9.3 area the more times you hit a figure in search of a bottom (double bottom--triple botton etc) many
times the stronger it becomes. I counted several times for the 9/5/03 and I think 3 times the 8/5/03 (ERG was going down at the time--the 9.3 x 10 area held for sometime though)
The low for the S&P500 on the 17/7/03 US time 978.60 finishing off it's lows above the 963 area 5% 10.1004 at 1/4/03---62,499,492#### resistance support line ...
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Chuck in some fundies. Below is very relevant to ERG-- in line with the doctrine--all of the bad stuff is behind it fundamanentally and contained within FY3
Assessing Company performance--provisions.
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Provisions are charges an entity makes against profits to allow for
expenses which have been incurred but for which the amount and the
payment date can only be estimated. In other words, they are estimates
of specific commitments. For example, in topic two we saw that
entities are required ke provision in their accounts for doubtful
debts. Provisions are made for such items as depreciation, long
service leave and warranty.
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All provisions relating to assets are deducted (doubtful debts,
inventory obsolesence, depreciation and amortisation) with all other
provisions being included under current or non current liabilities.
Sometimes provisions may be used to reduce profits. In a good year, an
entity may over provide, thus creating a cushion which can then be
used in a bad year to absorb any fall in profits.Provisions which
allow a greater amount of flexibiliy in the estimation procedure, tend
to be set on a fairly pessimistic note. This is part of the doctrine
of conservatism which simply means accountants do not like to take the
risk of reporting profit before they are reasonably certain the entity
will earn it. There can be a tendency to record all possible costs as
early as possible and revenues as late as possible. Entities doing
very well tend to be conservative in their accounting, whereas
entities having difficulties are tempted to abandon the doctrine of
conservatism. These are the entities which are more likely to fail.
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11/3/2002
---------------------------------------------"The ERG Directors believe this very conservative accounting treatment
will permit the ERG financial statements to be more transparent."
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Here is an estimation I've done in the past--it was done with a slightly different number of shares--it is the amount of value ERG have unlocked from accounts by doing the reconstruction.
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It was done on the 15th of May--the Group did not state the amount of shares on issue officially to the 23/6/03. It's more or less fairly accurate.
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With the rights issue proceeding unlocking 8.92c from ERG's accounts. (if not proceeding a higher figure 9.965)
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IP: Logged
bonkers
Full Member
Posts: 120
From:
Registered: Nov 2000
posted 18-09-2003 11:11 PM
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18th of September 3 day proxy for price is 94.6--13 days 92.6 -- 39 day 90.6 100 day 89.9 200 day 103.1
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###Below is not my work###--it was pinched off ##the Clocker## at Shares Guru----BK.
So as this forum doesn’t become totally Fundamental I’m reposting The Clocker’s submission to egoli, as it represents the simplest TA you can find. As all sources are attributed I cannot see how this could transgress any copyright laws. Having not seen the original source material, we have to take The Clocker’s word for it. With such general usage I don’t think ANYBODY can claim “sole proprietorship” of the numbers 3, 9 & 39. Publish & be damned. To balance up the Sharesguru Reference Library.
The Clocker
Sutton Park, NSW1/22/03
Trading Systems
Some of you might find the following useful. It was produced by TraderTalk as a tutorial for the average punter. I have used it as a tool for timing entry into a stock, but I tend to watch trading volumes for an exit. My own experience, since I adopted some discipline and put mind ahead of heart [pardon the pun in respect of VCR] has been very successful.
A Simple Moving Average Trading System - 3x13x39
"What is a good simple system to follow, to get in and out of markets?". Most people are comfortable with the herd. Such folk are most comfortable with a trend following system. I am ill at ease in a pack and downright anxious when everybody and his dog are comfortably saying the same thing. I am, therefore, drawn to oscillators to anticipate the end of popular perception. Oscillators also give an insight into the cyclical nature of markets.
Being obsessed with market structure and somewhat compulsive in my quest for efficiency my ways are not 'comfortable' for many. So to get back to basics for those not able or willing to devote the time to market study that I do here is a way to handle your market study and trading decisions.
Remember the numbers 3 x 13 = 39 Simple daily moving averages of 3,13 and 39 can keep you in and out of markets fairly efficiently and profitably, (in any time frame actually). I will show you how. Some basic principles to hang on to are:
· The market moves in long (secular) trends which may last years, e.g. the present equity bull market dates from 1982.
· Intermediate trends lasting many months, even a couple of years or so.
· Short term trends lasting weeks or months.
· Trade intermediate trends in either direction.
· Trade short term trends only in the direction of the intermediate trend.
Proxies:
· 3 Day MA - a proxy for price
· 13 Day MA - a proxy for the short term trend (a moving trend line)
· 39 Day MA - a proxy for the intermediate trend (a moving trend line)
· 40 week, 200 day MA - a proxy for the secular trend (a moving Trend line)
The Basics of MAs
MAs lag market reversals at tops and bottoms, the larger the MA the longer the lag period, the shorter the MA the shorter the lag but the more frequent the whipsaws. MAs work well when markets trend but get frequently whipsawed when they are in a range.
Therefore, trade trends with the MAs but do not trade ranges using MAs. Just stand aside and be patient until a new trend emerges.
The intermediate trend is in the direction of the 39 MA which acts like a moving trend line. If the 39 MA is pointing up then the intermediate trend is up, if down the trend is down. If the 39 MA is horizontal the market is in a range, from which a trend will, sooner or later, emerge.
Simple Trading Rules
1. When the 39 MA is moving up buy when the 3 MA crosses up over the 13 MA. and/or when the 3 MA crosses above the 39 MA.. When the 13 MA crosses above the 39 MA consider adding to your long position. Exit and stand aside when the 3 crosses back below the 13 MA..
2. When the 39 MA is moving down sell short when the 3 MA crosses below the 13 MA. and/or when the 3 MA crosses below the 39 MA.. When the 13 MA crosses below the 39 MA consider adding to your short position. Exit and stand aside when the 3 MA crosses back up over the 13 MA.
3. Only initiate trades in the opposite direction of the intermediate trend when the 3 MA crosses above or below the 39 MA, preferably after the 39 MA has already changed direction.
4. This 3:13 MA crossover will keep you trading in the trend with only a small lag and on the sidelines during corrections. The lag only becomes more substantial at reversals of the intermediate trend (a 3:39 crossover), a small price to pay at these uncertain times of trend transition.
Aids to Interpretation
· When the 3:13 crossovers occur at some distance from the 39 MA then you are likely dealing with a short term correction (even though it can be substantial) to the 39 MA.
· If the 3:13 & 39 MAs are close and converging before crossing over you are likely dealing with an intermediate (or significant) correction of the trend or reversal.
· Likely means probable NOT 'you can bet the farm on it' surety. There is no sure thing just as there is absolutely no free lunch.
Happy Punting
The Clocker
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