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MOMENTUM TRADER(TM)
JUMP START INSTRUCTIONS
===============================================
WHAT IS MOMENTUM TRADING?
Momentum Trading is the practice of making buy
and sell decisions based on short term
fluctuations of the market (following the
market momentum). It isn't talked about a lot,
but many Wall Street insiders and brokers use
this technique (but not this powerful software)
to enhance their own positions.
Up to now, a means of screening large
quantities of stock market data to identify
opportune stocks for momentum trading did not
exist for the small investor. Momemtum
Trader(TM) brings this power to your own
portfolio using the simplest of sources -- a
Basic CompuServe(R) account (about $10 a
month).
WHAT CAN MOMENTUM TRADER(TM) DO FOR YOU?
Use Momentum Trader to download hundreds of
stocks once each day from your CompuServe(R)
basic account for your history files. A
portfolio of 250 stocks (mutual funds and
market indices can be tracked, too) takes about
15 minutes a day to download with a fast
computer and a 9600 baud modem. The process is
automatic. Momentum Trader will hang up the
phone and beep you when it's done.
Then the fun begins. Historical plots of the
last hundred days are maintained for each of
the stocks you have placed in your list, with
technical data to assist you in making
investment decisions. Powerful screening
algorithms allow you to winnow down your list
to those stocks that meet your trading criteria
on a particular day. For example, you can
screen your hundreds of stocks for:
- those that had a high minus low that day
exceeding x.xx dollars
- those that had moving average crossovers of
2-3 days, or 3-5 days, up or down (indicates
stocks whose market direction is changing)
- those that have gone up or down x percent in
y days (want to find a stock that climbed ten
percent in two days - not uncommon - see
example below
WHY IS THIS IMPORTANT?
When a powerful stock tracking program like
Momentum Trader is combined with the services
of discount brokers, it becomes
possible to identify, buy and sell stocks which
fluctuate widely and rapidly for just a few
cents a share. Momentum Trader will easily
identify several stocks each day whose movement
is measured in multiple dollars IN A SINGLE
DAY.
The following plots show the kind of data you
can retrieve from your Momemtum Trader database
in minutes.
HIGH MINUS LOW
EXAMPLE OF SCREEN FOR HIGH MINUS LOW EXCEEDING TWO (DOLLARS IN ONE DAY)
(Actual Data From Momentum Trader(TM))
=======================================================================
LAM RESEARCH CORP COM Printed: 03-07-1995 06:31:03
35 37 39 41 43 45 47
_______________________________________________________________________
950221 *.........+....... L-C------H +.........+.........+.........+...
950222 *.........+........ L------C--H ........+.........+.........+...
950223 *.........+.........+.... L-C---H ......+.........+.........+...
950224 *.........+......... L--C--H .+.........+.........+.........+...
950227 *.........+.. LC--------H ....+.........+.........+.........+...
950228 *.........+.. L----------C ...+.........+.........+.........+...
950301 *.........+..... C-------------H .......+.........+.........+...
950302 *.........+..... L--C---H ....+.........+.........+.........+...
950303 *.........+..... L-------C-H .+.........+.........+.........+...
950306 *.........+.........+ L-------------CH .+.........+.........+...
=======================================================================
You will find several stocks each day whose
high minus low in a single day exceeds the cost
of buying and selling by a large factor,
sometimes as much as a factor of ten.
MOVING AVERAGE CROSSOVERS
Moving average crossovers indicate a stock that
is changing direction. A 2-3 day moving
average upturn, for example, signifies a stock
whose two day moving average exceeds its three
day moving average, AND THE SAME WAS NOT TRUE
YESTERDAY. A 3-5 day moving average crossover
indicates a turnaround of at least three days
duration.
EXAMPLE OF SCREEN FOR MOVING AVERAGE CROSSOVER (2-3 DAY, UP)
(Actual Data From Momentum Trader(TM))
=======================================================================
COLLAGEN CORP COM Printed: 03-07-1995 06:26:07
23 24 25 26 27 28 29
_______________________________________________________________________
950221 *.........+.........+... L-C----H ......+.........+.........+...
950222 *.........+.........+... L----------------C ......+.........+...
950223 *.........+.........+.........+..... L-------C----H ........+...
950224 *.........+.........+.........+........ L---C--H .+.........+...
950227 *.........+.........+.........+........ L-C----H .+.........+...
950228 *.........+.........+.........+.........+ C----H .+.........+...
950301 *.........+.........+.........+..... C---------H .+.........+...
950302 *.........+.........+ L----C---------H .+.........+.........+...
950303 *.........+.........+ L--------------C .+.........+.........+...
950306 *.........+.........+........ L---------------CH .+.........+...
EXAMPLE OF SCREEN FOR MOVING AVERAGE CROSSOVER (3-5 DAY, UP)
(Actual Data From Momentum Trader(TM))
=======================================================================
CALIFORNIA MICROWAVE INC Printed: 03-07-1995 06:24:52
27 28 29 30 31 32 33
_______________________________________________________________________
950221 *.........+.........+.........+.........+.........+ L----C----H
950222 *.........+.........+.........+.........+..... L--C------H .+...
950223 *.........+.........+.........+.........+..... C---------H .+...
950224 *.........+.........+.........+.........+ C------------H ...+...
950227 *.........+.........+..... L------C-------H ......+.........+...
950228 *.........+........ L-C--------------H .+.........+.........+...
950301 *........ L----C---------H ...+.........+.........+.........+...
950302 *..... L------------C ........+.........+.........+.........+...
950303 *.........+.........+ L-----------------C----H ...+.........+...
950306 *.........+.........+.........+ L--C----H ........+.........+...
EXAMPLE OF SCREEN FOR MOVING AVERAGE CROSSOVER (2-3 DAY, DOWN)
(Actual Data From Momentum Trader(TM))
=======================================================================
CYPRESS SEMICONDUCTOR COR Printed: 03-07-1995 06:30:01
24 25 26 27 28 29 30
_______________________________________________________________________
950221 *.........+.........+ L----C-H .........+.........+.........+...
950222 *.........+.........+....... L-C .......+.........+.........+...
950223 *.........+.........+......... L---C---H .........+.........+...
950224 *.........+.........+........ C-----H ..+.........+.........+...
950227 *.........+.........+.. L--C----H ......+.........+.........+...
950228 *.........+.........+..... L----------------C--H .+.........+...
950301 *.........+.........+.........+........ L---------------CH .+...
950302 *.........+.........+.........+.........+ L-------C--------H ...
950303 *.........+.........+.........+.........+... L----C-H ......+...
950306 *.........+.........+.........+.........+ L------CH ........+...
EXAMPLE OF SCREEN FOR MOVING AVERAGE CROSSOVER (3-5 DAY, DOWN)
(Actual Data From Momentum Trader(TM))
=======================================================================
OCTEL COMMUNICATIONS CORP Printed: 03-07-1995 06:29:06
19 20 21 22 23 24 25
_______________________________________________________________________
950221 *.........+.........+........ L----C---H .........+.........+...
950222 *.........+.........+.........+... LC---H ........+.........+...
950223 *.........+.........+.........+... L-C--H ........+.........+...
950224 *.........+.........+.........+... C----H ........+.........+...
950227 *.........+.........+..... L------C--H .+.........+.........+...
950228 *.........+.........+.........+ L---------C ......+.........+...
950301 *.........+.........+.........+.........+ L--C------H ......+...
950302 *.........+.........+.........+ L-------C----H ...+.........+...
950303 *.........+.........+........ L----C------H ......+.........+...
950306 *.........+... L---------C----H ........+.........+.........+...
PERCENT UP OR DOWN IN X DAYS
Another useful screening is for a stock whose
value moves up or down a large percentage in a
short number of days. These may indicate
stocks on an upward run; conversely, those
which have dropped rapidly in price may soon
present a buying opportunity when the moving
average crossovers indicate a turnaround.
EXAMPLE OF SCREEN FOR TEN PERCENT UP IN TWO DAYS
(Actual Data From Momentum Trader(TM))
=======================================================================
CHIPS & TECHNOLOGIES INC Printed: 03-07-1995 09:51:46
3 4 5 6 7 8 9
_______________________________________________________________________
950217 *.........+.........+.........+.... L--C .........+.........+...
950221 *.........+.........+.........+... LC--H .........+.........+...
950222 *.........+.........+.........+... C-H .+.........+.........+...
950223 *.........+.........+.........+.. L--C .+.........+.........+...
950224 *.........+.........+.........+... LCH .+.........+.........+...
950227 *.........+.........+.........+ L-C-H ..+.........+.........+...
950228 *.........+.........+.........+ C--H ...+.........+.........+...
950301 *.........+.........+.........+ L-CH ...+.........+.........+...
950302 *.........+.........+.........+ L-CH ...+.........+.........+...
950303 *.........+.........+.........+.. L-----C ........+.........+...
950306 *.........+.........+.........+.... L--------CH ..+.........+...
EXAMPLE OF SCREEN FOR TEN PERCENT DOWN IN TWO DAYS
(Actual Data From Momentum Trader(TM))
=======================================================================
SYQUEST TECHNOLOGY INC CO Printed: 03-07-1995 09:51:07
10 11 12 13 14 15 16
_______________________________________________________________________
950221 *.........+.........+.........+.........+.........+.. L--C--H ..
950222 *.........+.........+.........+.........+.........+.. L-C---H ..
950223 *.........+.........+.........+.........+.........+.. L-CH .+...
950224 *.........+.........+.........+.........+.........+.. C-H ..+...
950227 *.........+.........+.........+.........+........ LC--H ....+...
950228 *.........+.........+.........+.........+.. L--C----H ......+...
950301 *.........+.........+.........+.........+... LC--H .........+...
950302 *.........+.........+.........+.........+... C---H .........+...
950303 *.........+.........+......... LC------------H ...+.........+...
950306 *.........+.. LC--------------H ........+.........+.........+...
INSTALLING MOMENTUM TRADER
Momentum Trader takes the tedium out of stock
tracking. Here are the things you will need to
do in order to get started.
- Put the installation disk in your floppy
diskette drive. Switch to that drive.
- Type INSTALL <Enter>. The MT files will be
installed on your hard disk on the drive you
specify.
- Put away your installation diskette. Switch to
the subdirectory containing MT.
GETTING STARTED
- Type MTRADER <Enter>. Soon you will be at
the Momentum Trader Main Menu screen.
Momentum Trader will track stocks, mutual
funds, and market indices (such as the Dow
Jones 30), using data obtained with a basic
CompuServe(R) membership account. Each day
after you download the daily activity of your
stock list (up to hundreds of stocks), The data
from each stock will automatically be stored in
a history file which can be plotted, printed,
and searched with powerful algorithms to flag
stocks which have unusually high price
activity, turnarounds, or sustained runs, up or
down.
USING THE KEYBOARD AND MOUSE
Momentum Trader is easiest to operate with a
mouse. If you wish to use the keyboard,
however, there are two ways to do so.
- Hold down the <Alt> key, and press the
highlighted letter of the control you wish to
operate.
- Use the <Tab> key until the control you want is
highlighted. Then press <Enter>.
ENTERING YOUR COMPUSERVE ACCOUNT DATA
Momentum Trader handles the details of
retrieving your data automatically. You will
need to tell the program your CompuServe
account number, your password,the local
CompuServe phone number, your Com Port, and the
baud speed of your modem.
- Select "Options" from the main menu. Select
the sub menu "Communications".
- Enter the data mentioned in the paragraph
above. (If your first call to CompuServe is
unsuccessful, double check all of this data.
- Press "OK" to save the data and return to the
main menu.
RETRIEVING STOCK DATA
It is impractical to distribute Momentum Trader
with historical data files, since you will wish
them to be current each trading day. However,
to get you started, we have pre-installed a
list of more than two hundred active stocks
into your tracking list. Although you can add
to or delete stocks from this list at any time,
you may wish to use this list for a few days to
get the hang of it. So let's move on for the
moment to downloading data.
DOWNLOADING TODAY'S DATA
You can't do anything with Momentum Trader
(except look at the pretty menus) until you
have downloaded at least one day"s data.
The history files are intended to be updated
after the close of each trading day. There are
some other tricks we'll get to later, but for
now let's get some data!
- Select the leftmost menu choice ("Comm Link").
Then choose "Download Today's Data". The
Communications parameters are displayed. Press
OK to initiate an automatic download.
Depending on the number of stocks you are
tracking, the download will take several
minutes. You will be "beeped" when it is
finished.
You will be shown your downloaded data in
tabular form, and encouraged to scan it before
placing it in the permanent files. The data
can be scrolled with the vertical scroll bar,
the <PgUp> <PgDn> keys, and the arrow keys. In
the rare event that the data contains
"glitches", you can cancel and download again.
>>>>>>>>>> A word of caution here. The
allowable speed of a download is just as
dependent on the speed of the computer as it is
on the speed of the modem. For example, a 386
SX 20 connected to a 14,400 baud modem has to
be set as low as 2,400 baud to reliably read
all the downloaded data! The input buffer just
fills up faster than the SX can handle it, and
characters are missed. Missed characters can
introduce errors into your data files. You
shouldn't have any trouble with a 486 or
Pentium(R). In any case, if you see offsets
(the right edges of the columns don't line up)
after your download, discard the download, set
the Baud Rate lower in the Communications
Parameters menu, then repeat the download.
Because of this, the default Baud rate has been
set at 2,400 baud. If you have a fast computer
and modem, try higher settings. Use the
highest setting which reliably works for you.
<<<<<<<<<<<
If the data appears OK in the tabular summary,
- Press the <OK> button and load the data into
the permanent files. A status screen will show
your progress.
REVIEWING YOUR DATA
There are several powerful ways to review your
downloaded data. The simplest is to retrieve
the tabular data you have already seen. Do
this with the menu choice "File - Review
Today's Data"
You have begun a plot of each stock, mutual
fund, and index in your stock list.
Eventually, for registered users, these files
will grow to 100 trading days length and will
be continually pruned at that length without
your intervention. To see the beginning of
your plot, choose "Plot a Stock", select your
stock and press <OK>.
Stock selection can be by mouse, <PgUp> <PgDn>,
or arrow key. To shortcut the process, press
the first letter of the stock symbol, and you
will jump to that section of the list.
STOCK PLOTS
Momentum Trader will plot your stocks for you,
either onscreen or in hardcopy. The onscreen
plot is your first choice. After reviewing the
onscreen plot, you may select"Print Hardcopy"
to print a paper record, if you choose.
SCREENING YOUR STOCKS
The most powerful feature of Momentum Trader is
its ability to screen all the stocks you have
downloaded for criteria that you specify.
Click on the main menu item "Screen Files".
HIGH MINUS LOW
If you use a discount broker, you can buy or
sell stocks for a few cents a share.
Momentum Trader will screen your stock list for
stocks which vary in price DURING THE LAST
DAY'S TRADING whose high minus low exceeded a
criteria you set. The default value is two
(dollars per day). Several stocks with that
activity level will usually be identified each
day.
This feature is available after the first day's
download!
MOVING AVERAGE CROSSOVERS
Momentum trader constantly keeps track of the
2, 3, 5, 10, 15, 40, and 90 day moving averages
of all the stocks you track. Momentum traders
are interested in the crossovers which occur
between 2-3 days, and 3-5 days, because these
can signal impending turnarounds (2-3 day) and
more sustained turnaround (3-5 day). Momentum
Trader will screen for both of these conditions,
both up and down. Stocks are identified which
meet these criteria, AND DID NOT DO SO YESTERDAY
(a powerful algorithm which signifies a true
turnaround).
PERCENT UP/DOWN IN X DAYS
Stocks with sustained runs in price, up or
down, can be identified to the criteria you
set.
"WATCH" LIST
You will have stocks of interest, either in
your portfolio, or stocks you are considering
for purchase. You can identify these as
"Watch" stocks (see how in STOCK LIST
MAINTENANCE). At any time during the trading
day, you can click menu item "Comm Link",
"Download Watch Prices" to download just these
stocks for their most recent prices.
These will be presented in tabular form (same
as "File", "Review Watch File" at the end of
the download. They will NOT be added to the
history file (which operates on a single, once
at day's end basis).
You may find it helpful to include indices,
such as the Dow Jones 30, in your Watch list.
"IGNORE" LIST
You will no doubt track some indices, such as
the Dow Jones 30 Industrials. It would be
confusing for these to keep popping up in your
list of stocks screened for high minus low, or
other criteria. By identifying them as
"Ignore", they will not be selected during a
screening.
It is perfectly acceptable to mark an index
both "Watch" and "Ignore". A "W" or "I"
appear after the stock symbol name in the stock
list to indicate your selection.
STOCK LIST MAINTENANCE
The menu item "File", "Edit Stock List" is the
place to add and delete stocks from your list,
to mark them as "Watch" or "Ignore". Bring
up this menu selection. It's use is very
straightforward.
Add/Delete Stock Symbol
Click on "Add a Symbol" to add a stock to your
list. You will be prompted for the symbol.
To delete, highlight the symbol in the list and
click on "Delete a Symbol". You will be asked
to confirm the deletion, then asked whether to
also delete the history file.
Add To Watch / Remove From Watch
Highlight the stock symbol you wish to change.
Then click the "Add to Watch" or "Remove From
Watch" button.
Ignore / Don't Ignore
Highlight the symbol you wish to change
(usually an index). Then click the "Ignore" or
"Don't Ignore" button.
OPTIONS
The menu item "Options" contains several useful
entries:
General
The general options window allows you to reset
the screening criteria you wish to use in
screening stocks (such as high minus low
screening value).
You can also reset them individually when
conducting your screens.
Communications
The communications window allows you to reset
the baud rate of your system, the Com Port, the
CompuServe phone number, your User ID, and
Password.
These can also be reset when initiating a
download.
Export Data To Windows On WallStreet(TM)
You can export your Momentum Trader stock data
to WOW. There are many elegant stock plotting
options available in WOW, and you can use
Momentum Trader as a data source, saving
significantly on download fees.
Data is exported in ".CSV" (comma separated value)
format, which WOW can read.
The MTrader export is very fast, and therefore all
of your stocks are exported when you choose
'Export Data to Windows on WallStreet' from the
file menu. The import into WOW is considerably
slower, so you may wish to import only selected
files, or import all of them while you attend to
other tasks.
Instructions for importing your ".CSV" data are found
in the WOW Users Guide, and are briefly shown on your
screen when you select 'Export Data'.
Remove One Day
In case you inadvertently store some incorrect data,
you can remove one day using the 'Remove One Day'
command in the File menu. This removes that day from
each of your stock files.
Calendar
A multi-year calendar is provided for your
convenience.
You will also see this calendar after a
download of Today's Data. Should you download
after midnight, or on a Saturday or Sunday,
just click on the day the data applies to, and
the data will be properly recorded.
Print Registration Form
Yes, we hope very much that you find Momentum
Trader(TM) exciting and rewarding, and will
want to register!
BEAT THE BIG BOYS
This program brings power and speed into the
analytical tools available for the small
investor. It just may change the way the
small investor approaches the market. We, the
developers of this program thank you for giving
us a chance to prove it to you.
---
CompuServe(R) is a registered trademark of the
CompuServe Corporation.
Pentium(R) is a registered trademark of IBM
Corporation.
Momentum Software
P. O. Box 60519
Sunnyvale, CA 94088
NOTICE
Momentum Software is not affiliated with CompuServe(R),
and has no control over the CompuServe menu structure
nor operating protocol.
We have made every effort to make this program flawless
in its operation. In the unlikely event that CompuServe
should ever change its menu structure or protocol in
such a way as to make this program inoperative, Momentum
Software will attempt to make available a functional
replacement to registered users as soon as possible.
Momentum Software, however, makes no guarantees regarding
future useability of this program on the CompuServe
network.
REQUIREMENTS
Minimum:
IBM(R) Compatible Computer, 386SX or higher
Hayes Compatible Modem, 2400 baud or higher
Basic Plan Membership in CompuServe(R)
Desirable:
Faster Computer
Faster Modem