Friday, October 16, 2009

The MDFI rally of Oct 15, 2009

MDFI long range
MDFI day scale
MDFI intra-day

The long-range chart shows that even at the present $0.0045 level, MDFI is only a shade of its former $0.035 glory. (Like in astrophysics, you operate with orders of magnitude in this Supernova business). The day chart shows that it's quite possible to set up an automated trigger on the basis of combined volume and price gains which would put you on the bandwagon in the later stage of the intra-day rally while having a very high signal to noise ratio -- in other words, the percentage of false starts following such a trigger would be low. The long-range chart confirms the impression -- the vacuum of action in 2009 lasted for months.

5 comments:

  1. "only a shade of its former $0.035 glory" . . . I like that . . . :)

    ReplyDelete
  2. Can you get execution of the order at the "right price" to catch a part of the move?

    I think execution could be a problem with this type of stocks. You may not get filled on a limit order. If it's a market order, you may get filled at a price that undermines a short-term strategy.

    Actually, with OTC stocks I don't really know how execution works.

    Great ideas, though. It's an esoteric layer of stock trading.

    ReplyDelete
  3. Well, the number to think about is 300 million shares that changed hands on a single day. What execution you get depends on your trading volume. Another thing is spread -- but last time I checked a quote for such a stock with my broker, the spread was reasonable.

    My impression is: it's the market to make the first million and move on... Nothing more, but nothing less. If you don't move on, the problems you mention will keep you from growing.

    Another problem is that with thousands of companies like that, the amount of time it will take to complete one scan of the market at any point in time will be significant -- if we are talking about automated recognition of such patterns. It depends on the technology you use, and the fast technology may be expensive.

    The pattern recognition itself however should be a no-brainer, unlike forex.

    ReplyDelete
  4. Good chart report. I think best market strategy report. Thanks............

    ReplyDelete