Is anyone successfully using MA crosses to trade?
- Thread starter new2trading
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skeptic123
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Quote from marketsurfer:
furthermore, skeptic, just look at any intraday chart of a heavily traded stock--when the sloping 20 period sma is violated by price --the move tends to continue. yes, i have extensively tested multitudes of methods and have found that simple is best.
surf
How can you test a method if your exits are based on intuition?
BTW, I absolutely agree with you that entries are as important as exits. After all you profit/loss is the difference between the two.
That is exactly why I was wondering why you believe your 20 MA crossover entries are any better then 5 MA or 105 MA or MACD, or direction of previous bar or whatever other criteria are out there.Hope you guys do not take my questions personally, I am just curious. I backtested a number of MA based strategies a long time ago and the results were not impressive (I really do not remember the specifics though). Then again, I was trying to backtest a purely mechanical system based on MA entries and exits, of course introducing intuition into the game renders backtesting completely impossible IMO.
PS - I took a look at IBM' 5min chart with 20 period SMA. It is a beauty today, you would have made a bundle (again depending on your exits), on friday though you would have been whipsawed to death - they crossed on just about every bar.
sto,
i use three minute candles.
best,
surf
Quote from skeptic123:
How can you test a method if your exits are based on intuition?
BTW, I absolutely agree with you that entries are as important as exits. After all you profit/loss is the difference between the two.
Hope you guys do not take my questions personally, I am just curious. I backtested a number of MA based strategies a long time ago and the results were not impressive (I really do not remember the specifics though). Then again, I was trying to backtest a purely mechanical system based on MA entries and exits, of course introducing intuition into the game renders backtesting completely impossible IMO.
skeptic,
dude, never personal--i apprieciate the questions/challenge. the 20 period sma in the three minute time frame works for me. i am certain that other ma lengths and indicators work depending on the traders mind set. i have backtested the 3 minute sma price crossover method via tradestation, capturing different profits/losses with a mechanical system and the crossover system came out positive on most big cap issues. yes, you are correct about being whipsawed. if the stock is not short term trending-- you will be whipsawed. my system allows for 3 entries at the crossovers before seeking another (hopefully) trending stock. hope this makes sense.
surf
PS - I took a look at IBM' 5min chart with 20 period SMA. It is a beauty today, you would have made a bundle (again depending on your exits), on friday though you would have been whipsawed to death - they crossed on just about every bar.
sorry, my reply got quoted with your post. read carefully !
best,
surf
best,
surf
let me guess--you are a tape reader ?? OR an opening order only type ??
skeptic has a good point about being whipsawed. if the stock is not short term trending, you will be whipsawed using this method. i remedied this problem by making no more than 3 entries long and 3 entries short--being stopped out each time before i start looking for another (hopefully) trending stock.
best,
su4rf
best,
su4rf
Quote from marketsurfer:
let me guess--you are a tape reader ?? OR an opening order only type ??
what i am saying is that anyone that simply trades MA crossovers isnt a real trader he/she is simply a techncian..no offense (OK
you know...cross over click mouse..cross back click mouse... repeat..
I divine the market...I predict..I assimilate...i am a T-R-A-D-E-R
and i am good at it
you are funny, doogie !
surf
surf