Wednesday, March 22, 2006

Coming Market Research

Just wanted to outline a direction my research will be taking, integrating the theme from the last post (looking at multiple time frames) and the recent theme of market trending. I'll be working on creating trending measures of the markets on two different time frames and then will see if combining short- and longer-term trend measures helps us identify historical patterns. If so, that would be significant, because the trend measures will be ones that could be applied to any stocks or markets.

A second direction is identifying sectors that commonly lead the broad market and comparing their trend measures with that of the broad market. My hypothesis is that a "crossover", in which the trend of the leading market overtakes the broad market trend, might provide an entry signal for short-term trend followers.

Thanks again to readers who continue to provide lots of good food for thought. I hope this blog returns those favors--