Are there pullback systems that backtest well?

backtesting? no it's the Right edge of the chart that counts

pullbacks? no it's Breakouts that attract new trend buying/selling, not pullbacks, which is essentially fading the immediate past trend.

i like to keep it simple.
"jump on breakouts", as long as the stock isn't extended near the edge of it's daily trading range, and using time & sales patterns to spot new price action moves in the stock, along w/market internals (sector/trin/compq/emini patterns) etc.


ken

 

There are a quite a few good pullback systems discussed on the wealth-lab.com forum.

Runningbear

 

Bravo nitro,

An old Wall Street fox out of Jessie's days, Loeb (who didn't go broke), said something like:
"If it's known to everybody, it won't do any good".

May your wisdom also transcend the current century!

Be good,

nononsense

 

Ken DTU: backtesting? no it's the Right edge of the chart that counts

But backtesting takes the fear out of falling off the edge. Without backtesting, it would have been virtually impossible for me to put some excellent pullback systems in place.

Ken DTU: pullbacks? no it's Breakouts that attract new trend buying/selling, not pullbacks, which is essentially fading the immediate past trend.

While breakouts may attract trend buyers (often at just the time the trend is ready to end!), pullbacks will attract the greater number of private/insitutional traders and investors who like to buy low and sell higher, and who know the value of getting into a clearly oversold stock.

IMO, a very big advantage of trading pullbacks vs trends is that a trend trading win/loss ratio will typically be nearer 50%, whereas a good pullback system will often run 75-80 %. For me, and for many others, watching half your trend trades crap out because you bought at a high is NOT a pleasant way to spend the week. And finally, a good pullback system can perform well in a flat to down market when some stocks are quickly oversold. But trading a trend system in overall market weakness is very problematic.

 

Hi lindq,

Who said the contrary?

nononsense

(P.S. whether your "Right edge" is "of the chart" or not, it doesn't really matter.)

 

Would you post some of those ideas you have not seen before ? I mean those you are not recently using .
Thanks,
Walter

 

Bwahahahahahahhaa....

 

I'm not sure I agree with that.
I think that's why pivots, divergences, breakouts and pullbacks do work.

They work, because their are so many traders looking at the same thing. So, I would think, if you wanted to trade pullbacks as you're main strategy, look for the most common approach.

You want to be buying or selling when everyone else is, right?

 

Hi SumJurk,

If they work for you, you better keep quiet about the details. Be happy to cash in on it.

 

Hi...I'd be happy to share the details. Because, I want everybody to be going long or short when I do the same...