Even simpler profitable method

Discussion in 'Technical Analysis' started by Pekelo, Sep 26, 2006.

  1. Pekelo

    Pekelo

    I saw the other thread with tinkering the MACD crossovers and such, but I am too lazy and ignorant to read the whole thingy. My friend told me it was a good idea, and I believe him.

    Here is an even simpler swingtrading approach using the SMA 12:

    If the Dow is crossing above, you go long, if it crossed below, you short. I counted 1500 points (using YM futures) in the last 6 months with about 10 trades. I was being conservative, and there were a few breakeven trades....
     
  2. Pekelo

    Pekelo

    My usual way of posting pics doesn't seem to work, so here it is:
     
  3. You need a few more details here to know if this is of any value.

    Is this an always in method, i.e. reverse on crossovers? Or are you using a profit target/stop loss with each cross?

    It appears you're only basing trade entry on the daily closing price. You can't trade the DJX. So in looking at the DIA (or the YM for that matter), and assuming entry only at crossing at close, there are lot more whipsaws then what you're showing (particularly if you look a bit further back in the year).
     
  4. Great system! Looking forward to your P/L postings.
     
  5. Pekelo

    Pekelo

    Quote from sandygray66:

    You need a few more details here to know if this is of any value.

    Hey, I just came up with it a few mins ago... but true, stop loss for entries should be noted.


    Is this an always in method, i.e. reverse on crossovers?


    yes.


    Or are you using a profit target/stop loss with each cross?

    No for profittarget but yes for stop loss. Well, I guess once you are statisfied with the profits (let's say you captured a 300 pts move) you can get out or use a moving Stop loss.

    For entering I would use Surf's deadzone approach with a 20-30 pts deadzone/stop loss...

    So in looking at the DIA (or the YM for that matter), and assuming entry only at crossing at close, there are lot more whipsaws then what you're showing (particularly if you look a bit further back in the year).

    I looked at the candlestick charts and no (although the possibility exists), but it is a valid observation. I will try to post a candlestick version of the chart and I will pick a random 6 months in the past...

    Edit: After checking the candlestick charts (showing the daily actions too) it looks like that using SMA 15 is better instead of SMA 12 to avoid a few whipsaw entries
     
  6. Pekelo

    Pekelo

    OK, here is 2004's first 6 months. As you guys can see there is plenty whipsawing, but still the system captured 4 big 300+ moves.

    So the difficulty is to keep the entries' stop losses small, so they don't take away too much of the big moves' profits...
     
  7. nkhoi

    nkhoi Moderator

    in a rush to put out the simplest method, I might miss something but this 4,500v chart could be traded using candle engulfing setup :p
     
  8. balda

    balda

    I'll save you some time

    12sma
    no slippage or commissions are included
     
  9. balda

    balda

    your first pick has 15sma on it

    here you go

    15sma

    no slippage or commissions
     
  10. balda

    balda

    Do you teach any other strategies.
     
    #10     Sep 27, 2006