Tuesday, September 16, 2008

The New Three Sigma Long and Short Systems

The sigma indicator I developed that measures the standard deviation of the change of a stock over a certain period of time is showing a great deal of promise when used not just on its own as an oscillator, but when used as it is rising or falling over different time horizons.

For instance, the three sigma long system works when the sigma over progressively longer time horizons is rising showing that a stock's move is becoming more and more abnormal, yet rising.  When this happens, stocks tend to continue their rise.  I also studied the opposite as a sigma starts out high and then begins to show weakness over progressively longer time horizons.

The Three Sigma Long System is posted at www.foursigmatrading.com and I expect to have the short system up and running shortly.

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