Information overload, tools and intent.

Too much information to try to assimilate and internalize in one go, even though it's been a longish go.

I am needing to concentrate on fewer things in order to focus and get into a groove in my trading. This switching over to the NYSE and AMEX have opened a whole new world of information that, while I knew it was there, still proves a daunting task to sift through it to select the parts that I need or want to use.

I need to pick one or two complimentary bits and work with them, prove their use then add on more as I feel more comfortable with the first.

I still like the PP200 entries, and they worked out well today, so that will be the basis for my trading. I like the TICK chart so I will add that to get used to the price moves and the TICK correlation as I have used it to help with some timing and trend indication.

So, 200SMA, pivot points (monthly and daily), previous day OHLC

I will continue to keep an eye to the ADD but I find it just follows along with the price of SPY, or the value of the SPX. Also I see that trading SPY or SSO are similar enough to not need the leveraged ETF. SH vs SDS on the other hand have such a variance in volume that I might be concerned with trying to get out of an SH trade in a hurry in a fast moving market.

Other things that have crept into my view are, in no particular order:

VIX (a very interesting beastie, but of questionable use)
VWAP and WVMA (Volume Weighted, jury is out on this one, just another MA?)
Converging MAs (this one looks cool but ties up CPU resources terribly)
Sector ETFs (good for a general overall view of a market, helpful in trend determination)
ADD (see above)
Volume by Price (not readily available in a useful format through Esignals, interesting and needs more attention though)
SPY spikes (I think these are indicative of the nature of the ETFs and may have some level of predictive value, more back testing)

Odd notes about Volume.

I am still not so sure how much good volume is when trading an ETF as the price is based upon the underlying index valuation...volume can skew the price by the spread, can increase or decrease the spread but cannot move the actual price. So the volume is more a market participant gauge rather than a sure fire method to judge a move. Although on a large volume ETF I guess it can be a good herd indicator. Spy is so popular that many trade it as if it were a stock...but it's not.

Today I did some quick back testing on a pure volume trade entry with manual stops in the vein of a semi-mechanical trading style. The back testing looked good, and I might post something on it another time, but, true to form, I put it to the test to see how it executes. Well, mix a new style with end of day market and I am sure to get burned.

More to the point of the ETF volume though, I think that a pure volume trigger could work but I would expect it would work better on a high volume stock... Mmmmm...I feel some more back testing coming up this weekend.

This leads me to thinking that perhaps the fun of trading is not so much the trading itself but the trial and proving of a system. I have a hard time sticking to one thing long enough and with enough tenacity to let it show it's merit before adding something else into the mix. Constant interruptions and the odd connection glitch don't help matters either, but those are just excuses for the fact that I am not trying hard enough to actually make any money at this little venture.

Jeff.