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As we all know, the S&P futures tend to retrace, then shoot ahead; retrace, then shoot ahead. Here is an approach that takes advantage of this action by buying only after the market has fallen and started to move up again. It will catch some of the big moves and do better than break even on the rest. |
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This system buys when the S&P corrects 4% and then goes up. It sells if (a) it rises 4%, (b) it drops 4%, or (c) it crosses below a parabolic. You may want to try this on the Dow Jones Industrial Average futures. In Chicago-style trading, buying dips and selling rallies is part of the way we trade. Just be sure that you exit when the market goes against you. The SuperChart code is as follows: |
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IF: C[1] < .96 * HIGHEST(H,15)[1] and c > c[1] then: BUY this bar on the Close |
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IF: C < .96 * (EntryPrice) OR C CROSSES BELOW PARABOLIC(.00175) |
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OR maxPositionProfit > .04 * EntryPrice then: EXITLONG next bar at the market. |
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I was told that this approach had 78% accuracy. But keep in mind that we have just experienced a great bull market. As in any system, know what has been going on in the market you are testing. |
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What if you are not a programmer? Well, good news. There is software readily available in which the computer will write the code. All you have to do is identify key patterns. Currently, a company in New York allows traders to merely describe and locate a pattern. No written code required. |
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The application allows a trader to visually paint a market situation and then create an indicator or trading system by clicking a button. Since many traders are visually oriented, this is superior to most software packages with which you must learn programming skills just to trade. |
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Contact: webmaster@digital-ltd.com |
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