Subject: Brainy's FREE BullCharts TipSheet #14
Brainy's BullCharts* TipSheets
Number 14
Published: 12 June 2009

Dear Reader,

Welcome to the 14th edition of my (normally fortnightly) BullCharts software Tip Sheets, focussing on tips and hints regarding the Australian BullCharts charting software package.

Sometimes we get carried away with priorities, and some things just slip a little; but this edition of the BullCharts Tip Sheet contains some really juicy details about both Bear Markets turning, and Multiple Moving Average (MMA) indicators.

In the notes below, we copy an existing indicator, and customise it to create our own. I have already done this. If you want, you can download my own MMA indicator, and use it without going through the steps below. A link to do it, plus download instructions, is included below.

Please note that I am re-running a seminar from last year - Technical Analysis Introduction. It's happening in late June!! More details in the column at right.

Firstly, a little good news about some BullCharts hands-on workshops that I have been talking about for a long, long time.

As I mentioned last time I have sourced a good venue in Vermont South, just off Burwood Highway, not far from the Vermont South shopping centre (in Melbourne's eastern suburbs). I will be running a whole series of share market and technical analysis seminars and BullCharts workshops at the Vermont South Community House (VSCH) in the school term 3 from July to September. The VSCH is publishing and distributing over 4000 copies of their total education program to neighbouring houses. If you live in that area you will receive their program and see the event details. I will very soon put the details and dates on my web site here - stay tuned.
I recently delivered my new and FREE seminar - "The 10 Key Lessons from the GFC (for investors and traders)" seminar (ie. the Global Financial Crisis) at The Leighoak Hotel in Oakleigh. There were free hand-outs for all those who registered. A copy of the 25-page handout notes is available to download for FREE from this web page.
I am always happy to receive feedback and suggestions for these Tip Sheets. Or if anything in a Tip Sheet is not clear, please feel free to contact me to ask about it (by email or phone). Or maybe I have made a mistake, which I will be pleased to correct in the next Tip Sheet (along with an acknowledgement for whoever spots it first).

Please feel free to send me feedback, or requests for additional topics for these Tip Sheets or the monthly eNewsletter articles.

Good luck with your trading.

Robert ("Brainy") Brain
(Contact details below.)

Topics in this Tip Sheet edition:
  • Technical Analysis Introduction seminar
  • Bear Market turning?
  • Copy an existing indicator
  • Modify the new indicator
  • Download Brainy's MMA indicator
  • More information
  • This TipSheet might look strange?

  • Bear Market turning?

    Over recent weeks I have heard many analysts and commentators both here in Australia and in the US talking about how a number of stocks, and market indices, are moving above their 200-day Moving Average (MA). (But do they use a Simple MA or a Exponential MA? I don't actually know.)

    Have a look at the Price Chart shown here of the XJO (S&P/ASX 200) since late February, and showing the last market bottom on 6 March. The highest curve on this chart is a 200-day EMA. (You can click on the chart to see a larger version.) Notice that the price is now moving above the 200 day EMA.

    It can be possible to get a feel for the bullishness of the market by looking at share prices compared to their longer-term MA (on price charts like this one). Some people use this observation (ie. price above long term MA) as a buy signal. And of course they look for confirmation from volume, or another indicator or a chart pattern.

    But which long term MA should we look at? Above I said that some people say that 200 days is significant. But other commentators and analysts suggest different time periods. For example, Stan Weinstein in his book "Secrets for Profiting in Bull and Bear Markets" talks about a 30-week MA. He says that we should not buy a stock if the price is below the 30-week MA.

    And in the AFR newspaper (Australian Financial Review), they publish charts using a 60-day MA in the Market Wrap section where they show charts for five stocks on one page, and several overseas indices on another page.

    And you will find other experts who have a similarly different opinion about which time period is best to use.

    To help us work out which of these might be best for us, we can use a Multiple Moving Average (MMA) with some key time periods, all on one chart. It could be useful to view a Daily chart and show a 200-day MA, and a 150-day MA (which is very close to Weinstein's 30-week MA), plus maybe a 90 day MA, and a 60 day MA.

    If you are happy to have as many as 12 MA curves on your chart, then you can use the "Guppy Custom MA" in BullCharts, and enter your own time periods. You can customise it and save your preferred values as the Default values. To find this indicator in BullCharts, choose "Insert Indicator" from the menu (or Ctrl+I). In the Indicator dialogue box, in the "Category" drop-down, scroll all the way down the list until you find "Guppy, Daryl" toward the bottom (this drop-down groups the indicators, with authors towards the bottom). Then when Daryl Guppy's indicators are displayed, choose "Guppy Custom MA". On the right hand side of this dialogue box you can enter you own values.

    However, if you don't want 12 MA curves, you can create your own indicator, and add it to your Indicator toolbar. This is explained in the next section.

    Copy an existing indicator

    If you want to create your own indicator, there are two ways to do it. If you know enough about how to do it, you can "create a new" one from scratch.

    But it is easier to copy an existing one, and then modify it. In the text below, we will copy an existing one and modify it to suit our own purpose.

    I want to create a variation of the "Guppy MMA" indicator, so we will copy this one as our starting point.

    • In BullCharts, create a new chart (eg. XJO).
    • Click on the menu item "Insert > Indicator" (or use Ctrl+I).
    • In the "Category" drop-down selection, scroll down to "Guppy, Daryl" towards the bottom of the list and click once on it.
    • In the "Select Indicator" section, click once on the "Guppy MMA" item in the list. Note that there are no optional parameters available for customisation on the right hand side.
    • Note there are 3 tabs near the top of this dialogue - Insert, Builder, and Indicator Toolbar. Click once on the "Builder" tab.
    • Click once on the "Copy..." button.
    • In the next dialogue box ("Script Helper" is displayed across the top), click once in the "Formula Name" field near the top, and replace the text that is there with your own name - eg. Brainy's MMA. Then click on the OK button. As soon as you do this, BullCharts will create a new disk file on your computer in the folder described below, with the name that you typed into the "Formula Name" box. Note that it appears under the heading of "Guppy, Daryl" along with his other indicators. The Script Helper dialogue box is explained a little more in the following section.
    To see the list of Custom Indicators on your computer, use Windows Explorer (or My Computer) and navigate to the following sub-folder: c:\Program Files\BullSystems\BullCharts\CustomIndicators

    Modify the new indicator
    Click for a larger image.

    In the section above we copied an existing indicator, so now let's Edit this indicator, and customise it to use our own time periods. Follow these steps.

    • In the "Indicator" dialogue box that shows you a list of the indicators, find the one you just created, and click on it once to select it, then click on the "Edit..." button.
    • In the "Script Helper" dialogue box (see above) note the first paragraph of text starts out with "[description]=...". You can change any of the text here to anything you like.
    • Notice the text a few lines further down: "[target=Price; author=Guppy, Daryl]". You can change any of this. You should replace Guppy's name with your own, so that the indicator will later appear correctly in the list of indicators.
    • Note the next lines of text:- [color=Blue] [Name=EMA 3] ma(C,3,E); [Name=EMA 5] ma(C,5,E); [Name=EMA 8]... You can change these lines as much as you like. You can delete some of them. Note the following tips:
      • [color=Blue] - This specifies the colour to be used for the next chart item. There are many valid colours that you can specify here (about 120). To see a list in BullCharts hit the F1 key for help, then in the Search field type in the two words "color attribute" (without the quotes) and hit Enter, and select Color Attribute from the resulting list.
      • [Name=EMA 3] - This specifies the name of the next chart item. In this case, we have called it "EMA 3". You can change this to "fast", or whatever text you like. Once again, to learn more, use the BullCharts help topics.
      • ma(C,3,E) - This specifies that a Moving Average is to be plotted on the chart. The letter C of course is for a MA on the Close prices (you can change this to: O, H, L, etc.) The 3 is the number of bars. The E indicates the "method" to use - Exponential, Simple, Weighted, etc. (see the BullCharts help for a list of possibilities).
    • Now that you know the above, you can change any of the text in the indicator, and click on the "OK" button when done.
    • I have already done a sample version (called Brainy's MMA) and it is shown below.

    Download Brainy's MMA indicator

    It is easy to download someone else's BullCharts scan definition file, or custom indicator, and use it on another computer. This is because each indicator is stored on your computer's hard drive as a separate and unique file, and the file name is the same as the name you give to the indicator. You can email the file to someone, or download from a web site. The steps to download this one from the web are explained here.

    Very briefly what we are doing is this: Copy the indicator file to the correct folder on your computer, then start BullCharts. It is that easy. When BullCharts starts, it checks all the custom folders / directories and notes what files are stored there.

    • Firstly, if BullCharts is running, then shut it down.
    • Right-click on the link below, and select "Save Link As..."
    • If you are using Windows XP, then you need to save this file into the following directory: C:\Program Files\BullSystems\BullCharts\CustomIndicators\
    • Now start BullCharts and it will be listed with other indicators.

    More information

    More details on some of the topics in these Weekly Tip Sheets are included in Brainy's Monthly eNewsletters that are available to subscribers (for a very modest amount). Feel free to click on the relevant link at right to view samples and more details.

    These weekly Tip Sheets for BullCharts* users are intended to be short, quick grabs of information. They are not a replacement for the monthly detailed Brainy's eNewsletter articles, which cover these same topics but in much more detail. The eNewsletters articles also cover Technical Analysis and Share Trading topics.

    Also see the BullCharts on-line help (in BullCharts, hit the F1 key), and the relevant User Guide Chapter for more details (this is supplied with the software and copied to your hard drive as a PDF file).

    Note: Any screen shots shown in this newsletter are snapped from BullCharts version 3.8.

    FEEDBACK? - I am very keen to receive feedback about these weekly BullCharts Tipsheets. Please feel free to email me with comments, or suggestions. Contact details are included below.

    * - BullCharts is: " innovative charting and technical analysis system. It provides a feature rich and powerful set of tools with access to the latest strategies from local and overseas authors in analysing the dynamics of the stock market."

    This TipSheet might look strange?

    This TipSheet has been composed in HTML and distributed using an online service, and is intended to be viewed in HTML (ie. web language) format. Some parts might look a little strange, especially if you are viewing a basically text-only version. I am working on a text-only version.

    We have also found that some web-mail clients (eg. Hotmail and Yahoo mail) can mess up some aspects.

    Please feel free to send me feedback if anything looks strange.

    Good luck with your trading.

    Robert ("Brainy") Brain

    Technical Analysis Introduction seminar

    Here's a quick quiz for you.

    Technical Analysis is a very broad subject. How much do you know about each of the following topics? A basic understanding? or a more detailed knowledge?

    • Dow Theory and Efficient Market Hypothesis
    • Trend lines
    • Support and Resistance
    • Volume
    • Price charts
    • Chart patterns
    • Price breakouts
    • Indicators (lots)
    • Fibonacci
    • Trading intro
    • Stop Loss
    At the 4-hour Technical Analysis Introduction seminar I am running in late June, I will give you a really good broad understanding of what Technical Analysis is all about.

    The above list is just a short version of the seminar topics that we cover. Complete with hand-out notes with all the detail.

    More information including details on how to register are on my web site here.

    You can register at my secure outsourced OnLine Shop with credit card or PayPal, or print the registration form and send it in the mail (but if sending by mail, please ring me first to reserve a seat).

    The seminar venue on this occasion is the Leighoak Hotel in Oakleigh.

    Quick Links...

    1. If you are reading this FREE Weekly Tip Sheet second hand, and you would prefer to get your own directly and without delay, you can REGISTER here...

    2. Tip Sheets Archive

    3. Tip Sheets Index of topics

    4. Brainy's monthly eNewsletters

    5. More About Us

    6. The official BullCharts web site

    7. Australian BullCharts User Group details

    8. The BullCharts users' Yahoo Forum

    9. Brainy's Stocks and Shares portal web page

    10. Brainy's new YouTube channel, includes BullCharts tutorial(s) and useful trading stuff

    phone: 0438 355 910

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    Robert (Brainy) Brain | 23 Nathan Street | Ferntree Gully | Victoria | 3156 | Australia