Percent Above or Below Moving Average and Custom Stop

The track price in MarketSmith can be used to view a stock’s price in relation to various moving averages. The downside is that the information is not displayed directly on the chart, you must right click for each symbol to view the stats.

I’ve written thinkscript that will display the distance above or below either the 21-day exponential moving average or the 10-week simple moving average. If you are viewing a daily chart you’ll see the former, when on a weekly chart, the latter.

I’ve also added information that indicates the price for a specific percentage below the moving average. The percent below can be configured using the Inputs and Options dialog in thinkorswim.

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Quarterly EPS Shown as a Line Graph

One aspect I really appreciate of charting apps that offer custom coding capabilities is that you can present information visually that typically is not shown in that manner. For example with a few lines of thinkscript code you can plot a line graph of quarterly EPS in thinkorswim.

What follows is a screenshot of the line graph I wrote in less than 30 lines of code. The red and green dots represent the quarterly earnings, indicating if the current results were up/down from the previous report. I also appended at the bottom of the image the optional EPS bubble.

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RS Line and Recent High in thinkorswim

One very helpful gauge within MarketSmith is the RS Line, which represents a stock’s performance versus the S&P 500. As growth traders, we look for an upward trending RS Line.

In addition to MarketSmith, I also use thinkorswim, as I can write scripts to customize the charts, do back-testing and otherwise tinker with the UI. I thought it might be a nice addition to my workspace to show an RS Line indicator.

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Position Size Calculator for thinkorswim

A position size calculator can help you focus on fundamental and technical analysis without getting bogged down in repetitive tasks such as determining the number of shares to buy and the resulting position size. Let me explain.

Before I enter a trade, there are a few things I always know up front: how much I am willing to risk as a percent of my equity, where my original stop will be set, and my first target to consider taking profit (full or partial).

As far as a stop, based on my research of previous chart patterns as well as my own trades, I often find that a break of a moving average is a good place to consider a stop.

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Configure Regression Channel in thinkorswim

On IBDLive, Chris Gessel often uses @thinkorswim to highlight technical action. Chris has been using a regression line that is discussed by Mike Webster on his Weekly Stock Market Update.

I’ve created a similar configuration that I thought others might find helpful. The image below shows the configuration that I describe in the steps that follow. Notice how the highs and lows of the Nasdaq Composite have held within the half standard deviations.

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