STOCKCASTER is based on an statistical algorithm that searches for recuring patterns on 500 of the highest volume stocks traded on the NYSE and NASDAQ.

When a pattern is validated, the stock is run against another model to determine the probability of a short term gain during the same trading day that the pattern is made.

The programs are run each night using historical price data from a rolling ten-day period, including the current day’s trading data.

At 7:00 CST each morning, four or five trade candidates are posted on the STOCKCASTER.NET site based on the results of the algorithm run the prior night.  Five-minute interval charts, courtesy of Trading View, are displayed with the entry and exit points for the day.  

 

What do the daily charts look like and how do I use them?

How does the algorithm work?

Can these trades be auto-executed through a bot?

 

 

 

How does the algorithm work?

The program searches for a recurring pattern among five minute bar closing prices.  

 

The program tracks five-minute bar intervals and searches for a  sequential pattern of closing prices over a four to seven bar period during a single trading day.

When that pattern is repeated significantly (find another word) over the ten day lookback period, a second program is run to compare the comparison is made between the opening price of the next bar following the completed sequence, and the end of day price.   If there is a 90% or greater probablity that the end of the day price will be higher, or lower than the opening after the sequence, then that stock and pattern is posted on the Stockcaster site as a potential trade.  These probablities are obviously based on historical prices, but can be quite accurate in the short term.  

Here’s an example:

Over the prior 10 trading days, on a five-minute bar chart, AAPL has had this sequence of bars at some point during 7 of the 10 days:

Bar X – Closing Price is Higher than prior bar

Bar X+1 – Closing Price is Higher than BarX

Bar X+2 – Closing Price is Lower than Bar X +1

Bar X +3 – Closing Price is Higher than Bar X+2

Bar X +4 – Closing Price is Lower  than Bar X+3

Bar X+5 – Compare Opening price to End of Day Price

In this example, if AAPL 

 

 

 

 

 

 

 

 

 If there has been at least a 90% consistency rate that the end of the day price is higher than the opening price after the sequence, then that stock is chosen as a candidate to trade for the next day.  

calculates the number of times a stock has  closing prices for each five-minute bar and if a pattern