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I know that as we switch to smaller and smaller time frames, the "noise" becomes bigger, but it is also true that the market is fractal in nature, the same exact technical patterns are at work on every time frame, from the 1 min chart to the yearly chart. But you are right, a descending...

Interesting. But how do you define "velocity" in mathematical terms? Thanks. True, it seems that the equity market (stock and indexes) is essentially mean reverting, while commodities can trend for a very long time.

Really? Do you have any serious statistical study to validate this claim? True (at least for now), but financial markets have nothing to do with the weather. People (traders) move the market, while on the other hand the weather is controlled by physical laws.

You lost money trading and that means the market is not random?? Never heard that one before :D But the way, the only way to lose consistently is to constantly bet against the trend, you will get crushed in no time (and I am not even talking about the spread and/or commissions).

?? :confused: If you could predict a top with a high degree of accuracy, then predicting a monthly or a yearly top would be no more difficult than predicting an intraday top, all you need to do is change the time frame accordingly.

By the way, I remember reading that buying stocks that have been down for 3 consecutive days is a winning strategy in the long run (close of day 2 is lower than close of day1, and close of day 3 is lower than close of day 2), so the backtest should give you good results.

You are probably talking about their "S&P Low Volatility Breakout Trading Strategy". Impressive results I must say. Here are the hypothetical results, according to their website.

Good point. In other words you are looking for "quiet", "boring" stocks ready to explode.

The problem with this idea is that some of the most powerful breakouts occur precisely when the market is choppy and seemingly going nowhere... :cool:

Yes, it should be interesting to study the behavior and performance of breakouts with low volume , compared to breakouts with high volume. For example, how far do they "travel" after the breakout, in each case? Thanks for your feedback :)

That's why virtual (aka bullshit) currencies were invented my friend...

I have read somewhere that this rule actually hurts the performance of the breakout! In other word, breakouts that occur with above average volume do not perform that well, go figure why... Bottom line, a trader should never take any trading idea for granted, no matter how "logical" it sounds.

Keep in mind that money does not go anywhere and never disappears, it is simply transferred from one pocket to another pocket. And, most of the time, it is transferred from the poor to the rich. So when you hear on freaking TV that some company, government or country "lost" billions, someone...

Also note that real breakouts rarely go sideways after the breakout, they keep moving in the new direction and, more than 50% of the time, do not even pullback to the breakout point. So if the market goes sideways after a breakout, then it's time to ask yourself if this is a real breakout to...

Today, the banksters rule the world. https://www.youtube.com/watch?v=JZGiwNJw8E8

Put 2 simple moving averages on your chart (20 and 50 for example) and ignore any breakout to the upside if the price is not completely above the 2 moving averages. Same thing for short signals, ignore any breakout to the downside if the price is not completely below the 2 moving averages...

Try just to break even with your "system" and your oh-so-secret "quant" analysis and then we will talk some more.

I am puzzled by nothing Dbphoenix, I have my own profitable and purely mechanical trading system and could not care less about IBD or some other newspaper.

Yeah right, I bet you cannot even beat the S&P 500 :D

You are obviously promoting IBD. Anyway. Pfffff..... Like if trading has to be complicated to be profitable. You can make money with a simple moving average, assuming you have discipline and can manage risk, no need to export and manipulate excel files from some newspaper.