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I can not predict the future and can not tell "when a breakout is going to happen". I wait until price increases above some historical high price and then I buy. I wait until the price declines below some historical low price then I sell. I don't risk more than 1 % of equity on a single...

No. If you track your trading, or backtest for a long period of time, and accumulate enough trades then I expect to see losing trades and losing streaks. The losing streak is a drawdown. Trading individual securities can produce drawdowns. If you stop a loss then the loss is part of a...

SP500 index graph reminds me of the September 1990 SP500 index graph. Same sort of rounding bottom pattern. Probably doesn't mean anything.

I use the price trading range from various timeframes. I remember analyzing the 10 day range, 20 day, 50 day, 100 day range. Attached is volatility data for SPY stock. At the time I remember comparing the volatility of the unmanaged Standard And Poors 500 Index tracking stock, symbol SPY...

I remember calculating average volume for NASDAQ with Excel spreadsheet. I recall downloading NASDAQ price and volume data from yahoo.com, pasting it into a spreadsheet and writing formulas that calculate average volume.

Yes. If there is a drought the nearest contract price can increase a lot but the next contract price might not increase and price can decrease.

There is a big difference between day trading and overnight position trading. Slippage and the opening gap can make a short term overnight position trading system unprofitable.

That is how I use ATR, as a volatility indicator. I use ATR to calculate position size.

I disregard the Kelly criterion. It is the drawdowns that concern me. Risk has to be small enough so that the drawdowns do not make me feel sick. That seems to be less than 1 % risk using long term position trades.

Assume you bet 10 % of your money each time you trade. If you lose 10 times in a row then you lost everything and can not trade any more. Bet 1 % and it takes 100 losers in a row to lose all your money. You might want to consider how likely it is that you might lose 10 times, or 20 times...

I suspect price change is about two days ahead of the news. Maybe there is some kind of peace agreement between Israel and Lebanon.

These are the results of a long term stock simulation using Consolidated Edison stock, symbol ED. The simulation is over 36.59 years from 2 January 1970 to 28 July 2006. Donchian channel parameters used are 90 days entry, 240 days exit, 10 percent risk. Position size is equal to 10 percent of...

Assume the moving average value is 50.00. Price rises to 50.01 and you buy. The spread might be 0.10 or 0.20, below your intended exit price of 49.99. If you modify the rule, say "Buy when price moves one tick above 1.05 times the value of the 12 day simple MA" the system might not show the...

You might examine the Zweig system that I remember posting on elitetrader.com. I find EURUSD tests well with 6 % entry, 1.3 %exit, 5 % risk, cash only (no margin) and long positions only. I only have 7.79 years of EURUSD exchange rate data to test and prefer to have more data before trading with...

This is how I calculate the "extreme high price". Assume the simulation begins on day zero, HighPrice[0]. I set the extreme high price = HighPrice[0]. The next day price rises. If HighPrice[1] > HighPrice[0] then extreme high price = HighPrice[1]. Each following session I repeat the test...

This is an example of trading HLT using a long term Zweig trading system. This test uses these rules: 1) If price rallys 32 % from an extreme low price then buy. 2) If price reacts 26 % from an extreme high price then sell. 3) Position size is 10 % of account equity / 10 times average...

I recall about year 1980 Martin Zweig publishing a trend following system. I find this system interesting because it is independent of time and has no lag. I am writing the rules into computer code and testing the method. These are the rules that I remember Martin Zweig describing: 1) If...

I write computer programs and test trading methods. "Modeling" trading methods might be a better phrase. I also write software to model the behavior of an entire portfolio. One day I might post a page of results of portfolio studies. I suspect the behavior of a portfolio is more important than...

Why position trade long term? The following is what happens when a 10 day average is substituted for the 350 day average in the example above. Number of trades 394 Total profit $ 107978 Profit after subtracting $ 10.00 commission, slippage per transaction: $ 100098 Risk is 1.00 per cent of...

OK lets see what happens when I trade Boeing stock using a Bollinger Band system. Trading begins 2 January 1962 and ends 14 July 2006. These are the rules: 1) Buy when stock price increases above the 350 day average value plus 2 standard deviations. 2) Sell when stock price decreases below...