Facebook Twitter Gplus Pinterest YouTube RSS
Home Archive for category "Trading strategies test"
formats

The trend is your friend!

“The trend is your friend”. This famous phrase is in almost all trading books. But how important is it to trade in the direction of the trend? This is the question I asked myself. Before answering this question, we will discuss some generalities. Whereof is usually composed a trading strategy: An entry that gives us

Read More…

 
 Share on Facebook Share on Twitter Share on Reddit Share on LinkedIn
No Comments  comments 
formats

Random entry + ATR Trailing Stop

Can a strategy based on a random input  with a suitable output and money management be profitable? Dr Van Tharp in his book Super Trader, said he did the test in 10 markets over a period of 10 years, and says the results were positive in a consistent manner. “It didn’t make a lot of money and

Read More…

 
 Share on Facebook Share on Twitter Share on Reddit Share on LinkedIn
No Comments  comments 
formats

Moving Average Crossover

If there is a popular technique in trading, it is the moving averages (MA) crossover. We saw in a previous article that the problem of the strategy based on the MA was whipsaw. We then presented a technique that corrects the issue in the article on the Keltner bands. The technique of using crossing of two

Read More…

 
 Share on Facebook Share on Twitter Share on Reddit Share on LinkedIn
No Comments  comments 
formats

The Donchian Channel

The Donchian Channel was developed by Richard Donchian, who used a 50 weeks period in the original strategy.  The idea is to buy when the price breaks the upper band of the channel (maximum 50 weeks) and sell when it breaks the lower band of the channel (minimum 50 weeks). However, this is Richard Dennis who popularized

Read More…

 
 Share on Facebook Share on Twitter Share on Reddit Share on LinkedIn
No Comments  comments 
formats

Keltner Channel

One weakness of the strategy of price crosses its moving average, is the many whipsaw, closing the position at a loss before the trend has a chance to settle. This is why trading slope of the moving average gives better results; It takes position when the trend is sufficiently established. The whipsaw is a component of

Read More…

 
 Share on Facebook Share on Twitter Share on Reddit Share on LinkedIn
No Comments  comments 
formats

All flavors of moving average!

The moving average is perhaps the most popular  technical analysis tool of markets. According to this article, its use for smoothing data goes back to the early 20th century. Its use to define the market trend is everywhere, on traders screen  as well as specialized media screens. It is impossible to find a book of

Read More…

 
 Share on Facebook Share on Twitter Share on Reddit Share on LinkedIn
No Comments  comments 
formats

Bollinger Bands

There are several strategies based on Bollinger Bands.  I choose two of them for my first test.   Strategy # 1: The classic strategy uses Bollinger bands as support and resistance. Indeed, we trade the bounce of bands. The basic rules are as follows: Buy: when the price tests the lower band and closes above it,

Read More…

 
 Share on Facebook Share on Twitter Share on Reddit Share on LinkedIn
No Comments  comments