Ztrader

Ztrader – Typical Trading Distribution

 

 

Look at the trading volume of # 0005 yesterday, you can see a U shape:

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To average out all the stocks, a volume and turnover distributions graph is:

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The blue line is the turnover distribution, the red line is trading volume distribution.

Both of them showing a U shape, with a small spark after lunch. Busiest moment is first five and last ten minutes. The most quiet moment is after 13:05 and before 14:00, and momentum catching up after 3:00.

 

Divide these two data:

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Interesting information is, typical stocks traded with a smaller price (usually small cap), are relatively more active between 11:30 to 12:00, and 14:00 to 15:00. At those periods, big accounts take rests and market relatively more focus on smaller caps, for examples:

 

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Ztrader

Ztrader – Linear Regression Channel

 

 

A linear price channel (Raff Regression Channel) is something easy to interpret for ordinary traders. Especially for some stable and trending stocks, like # 1382:

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# 2343

 

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These trend lines can be semi-automatically created. The center line is created by linear regression, and the upper and lower band is created by computing the minimum size of the band to include all data points.

 

One can simplify the trend of a stock by look at the slope of such bands. For example, # 0746 this year, if I draw the trend lines in this way:

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So the trend can be interpreted as: Negative => Very Negative => rebound => Negative => Positive

 

In fact some stocks, like 746, the historical trend show a repeating pattern:

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Pattern since mid 2011: Very negative => rebound => Negative => Breakout => Very negative => negative => Positive => breakout => Very negative => rebound => Negative => Positive => ?

 

And linear price channel seems a helpful tool for this kind of stock. Buy and sell decision can be made on channel breakout, providing the channel is determine.

 

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While this article has not published yesterday, today 746 break out the channel with relative high turnover:

 

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