Do you believe the retrace to the 20 ema with adx above 30 is a method one could make a living with? http://www.nofearzone.com/Grail.asp
I think it's one of the best ways of trading the trend. I used to use the ADX all the time, but I've found some stochastic settings that I really like and use now. I posted a sample on this thread here---second post. http://elitetrader.com/vb/showthread.php?s=&threadid=12028 As far as trading bounces off the 20 ma goes, I think it would work if you stick with it. In other words, take every signal and don't try to pick and choose which setups you want. Hope this helps...
It's just a visual aid. When I see green beads, I know I'm 80 or higher and when I see red beads I'm 20 or lower. I use Ensign sofware. You can download a free trial here
and the H.G. pattern doesn't look very good. I tested it across CIEN, IBM, GE, AMZN, HAS and none of them performed well over 1000 day period. I should point out that I didn't do the coding, I just had it laying around, so there might be some problems there. Anyone else find especially good results with this pattern across several equities?
and adjusted the ADX default from 14 to 30 and stuck a different (ATR based) exit on the same stocks. IBM performed very well over 500 and 1000 daily bars, but the other stocks didn't do very well.
Yeah, not really surprised. The holy grail method isn't really an objective method. That ADX can get tricky sometimes. But, I think if you practice with it for a good while, and get familiar with it's idiosyncrasies, it's a viable method. It's kind of like trying to backtest stochastic divergences, it would be very difficult, if not impossible. Since, no two divergences look the same.