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
 
Quote from nitro:

[...]

FWI, I am very close to agreeing with limitdown. It is INCREDIBLY hard to backtest _correctly_. If you use _only_ the tools as they are sold that are on the market to come up with a winning system, I would say that is nearly impossible to do so.

[...]

It is an incredibly hard road...The ideas that I have used to come up with winning futures systems, I have never seen before...

nitro
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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.
 
Quote from lindq:

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

[...]
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Hi lindq,

Who said the contrary? :D

nononsense

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

It is an incredibly hard road...The ideas that I have used to come up with winning futures systems, I have never seen before...

nitro
More...

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

I use TradeStation, Mathematica, Matlab, and C# for my system testing.

FWI, I am very close to agreeing with limitdown. It is INCREDIBLY hard to backtest _correctly_. If you use _only_ the tools as they are sold that are on the market to come up with a winning system, I would say that is nearly impossible to do so.

I use TS to protoptype an idea. But once I think I have something, I go to one of the other programs, eventually landing in C# for the production system, often in conjuction with Excel.

It is an incredibly hard road...The ideas that I have used to come up with winning futures systems, I have never seen before...

nitro
More...

Bwahahahahahahhaa....
 
Quote from nononsense:


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".
More...

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?
 
Quote from SumJurk:

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?
More...

Hi SumJurk,

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

:D
 
Quote from nononsense:

Hi SumJurk,

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

:D
More...

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