Point and Figure Charting Message Board

To: Rich1 who wrote (25849)	11/8/2002 12:03:27 PM
From: Ben Antanaitis	Read Replies (2) of 26982

Log scaling works better than traditional scaling in all cases, indices included. For folks who want to work p&f with mutual funds, log scaling is ideal also. The log scale chart does not have the 'break-points' at 5, 20, or 100 which cause strange non-linearities in traditional scaling. And, the patterns do not change when splits occur in an issue. I wouldn't stick a flag in the ground based solely on the 1% chart. I usually watch a range of charts on an issue, 2% for direction, 1% or .5% for timing or quick in-out moves. The percentage value you choose can assist when there is a lot of price volatility with an issue. The higher the percent used, the more the volatility is filtered. The lower the value, the faster chart patterns will form. However, you have to remember that most non-professionals use the traditional charting because that is the only method they learned from popular press books on p&f. This means that they may be acting/reacting to p&f pattern signals generated off of the traditional scaled charts. So you need to consider what the traditional chart may be doing as well. Ben A. ez-pnf.com