Technical Analysis: Using Williams %R with Price Headley, CFA, CMT BIGTRENDS

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2 Technical Analysis: Using Williams %R with Price Headley, CFA, CMT

3 BigTrends Education Access to Big Trends and its educational services is provided for informational purposes only. All of the information presented here does not constitute a recommendation to buy or sell a particular investment. You are solely responsible for your investment decisions, and BigTrends and its staff are not responsible for any trades you choose to make. Not all Big Trends products or services are appropriate for all investors. BigTrends does not provide personalized financial, tax or legal advice. Please consult your tax consultant prior to making any investment that may impact your tax situation.

4 Percent R Conventional Approach vs. BigTrends Approach Larry Williams Created the Williams Percent R indicator. Used 14-Bar setting. Scale was 0 to Oversold Level: Overbought Level: -20. Extreme levels of -80 & -20 used to signal reversal points. Stocks can t stay oversold or overbought for an extended period of time. BigTrends Adapted Percent R to improve efficiency. Use 30-Bar setting. New Scale: 0 to New Oversold Level: 20. New Overbought Level: 80. New Extreme levels of 80 & 20 are used to signal a trending security. Stocks remain oversold / overbought for extended periods of time. The Mid-Line 50 Level shows basic trend

5 Williams %R - The BigTrends Way: Trading the Extremes to Find Major Trends Williams %R is similar to Stochastics in measuring overbought & oversold levels the traditional scale is from 0 down to While most use a 10 or 14 bar setting, I use a 30-bar setting smoother but still responsive BULL TRENDS: Look for overbought reading above -20, followed by a close above that bar s high BEAR TRENDS: Look for oversold reading below -80, followed by a close below that bar s low

6 Dow Diamonds (DIA) Daily Percent R & Acceleration Bands

7 Dow Diamonds (DIA) Daily 2011

8 US Oil (USO) Daily 2010

9 US Oil (USO) Daily 2011

10 What is it about ACHIEVEMENT that makes so many come up short? I believe the Answer is. DISCIPLINE (or lack thereof) How many times have you been Undisciplined (knew you should do X, but did not) And paid the price? Here s how to get on the Fast Track to potentially transfer Knowledge into Results

11 Apple Computer (AAPL) Daily 2010

12 Apple Computer (AAPL) Daily 2011

13 In The Moneys as Potential Stock Substitute Buy In the Money Options to Reduce Time Value => Example: Focus on Intrinsic Sell 100 XYZ = $5660 Buy 1 July = $ 470 XYZ goes to 50 before mid-july: Short Shares gain $660, or 11.7% ITMs gain $530, or 112%

14 Wynn Resorts (WYNN) Daily 2010

15 Wynn Resorts (WYNN) Daily 2011

16 Percent R: CBOE Volatility Index (VIX) Daily 2010

17 Percent R: CBOE Volatility Index (VIX) Daily 2011