Details matter in trading, and today we show you 2 simple trading rules to improve your performance. Let’s start with the first one: 200-Day Moving Average Trend Following This simple trading rule can make you money (according to Paul Tudor…
A Simple Stochastic Pullback Strategy for Uptrending Markets aims to buy short-term weakness without fighting the broader trend. The basic idea is straightforward: when a market is trading above a rising moving average, a low Stochastic reading may signal a…
The RSI pullback strategy is a simple way to look for short-term buying opportunities during an existing uptrend. Instead of buying after prices have already moved higher, the strategy waits for a temporary decline. The Relative Strength Index, or RSI,…
Today, we look at how to profit from market pullbacks: 2 mean reversion strategies. Markets rarely move in a straight line. Even during strong trends, prices often pull back before continuing higher. Mean reversion strategies try to take advantage of…
2 IBS Indicator Strategies That Exploit Short-Term Reversals examines how a simple but little-known indicator can help identify short-term overbought and oversold conditions. What Is The IBS Indicator? IBS stands for Internal Bar Strength and measures where the closing price…
Today, we look at 2 different RSI strategies. The strategies are called the Normalized RSI strategy and RSI-based range momentum system. The Relative Strength Index, better known as RSI, is one of the most widely used indicators in trading. However,…
Today, we look at a trading strategy we call the rate-of-return momentum strategy. Rate-of-Return Momentum Strategy The backtested strategy returned the following results (after slippage and commissions of 0.03% per trade): Strategy type: Momentum strategy. Market: S&P 500 Momentum Index…
Erik Smolinski’s Background and Track Record Erik Smolinski’s journey into the financial world began far from the trading floor. Raised by a single mother who worked as an occupational therapist, he grew up in a low-income household where he worked…
Today, we ask a simple question: Should you avoid bear markets? First, we need to establish what a bear market is: it’s when the price is below the 200-day moving average. The average is a frequently used filter for bull…
Many traders dream of quitting their jobs and trading for a living. But for most people, this dream does not survive a simple look at the numbers. Suppose you need $75,000 a year to support yourself and your family (unless…
Many readers have indicated they like to rotate between assets. Thus, we compile an article called how to rotate between assets: 3 backtested strategies. Markets rarely move in the same direction at the same time. While one asset class is…
Today, we look at 3 trend following strategies. Trend following is simple in theory: buy when prices move higher and exit when the trend weakens. The challenge is finding rules that are robust enough to work across different markets and…
This article looks at 3 technical indicator strategies that work. Indicators are often dismissed as unreliable or overly simplistic. And in many cases, that criticism is justified. An indicator alone does not create a profitable trading strategy, and almost any…
You have probably experienced the following: You crush it for a week with Strategy A – three green days in a row, confidence through the roof. Then a couple of losers hit, and suddenly you’re on Reddit hunting for Strategy…
Today, we show you a trend-following and mean-reversion strategy – combined. Trend following and mean reversion are often presented as two opposing ways to trade. Trend-following strategies assume that price movements can continue in the same direction. They attempt to capture…
Today, we backtest a multi-asset trend-following strategy. Instead of trying to predict which asset class will perform best, the strategy follows price trends across several markets. When an asset is rising and showing strength, the strategy can be invested. When…
Today, we backtest a Donchian Trend-Following Strategy. Trend following is one of the oldest and most tested ideas in trading. Instead of trying to buy cheap or predict turning points, a trend following strategy tries to do something much simpler:…
Let’s look at a century of US stock returns*. Most investors know the long-term story of the US stock market. Stocks go up over time. But that simple sentence hides a lot of pain, patience, luck, and uncertainty. Looking at…
Today, we are looking at yield vs. stock strategy. The relationship between bond yields and stock market returns is one of the most important connections in financial markets. Let’s look at the theory: In theory, higher yields should make stocks…
Today, we look at a seasonal strategy for bonds. We backtest TLT. Are bonds boring? Bonds are often seen as boring, but boring markets can still offer useful trading edges. This strategy focuses on TLT, the ETF that tracks long-term…
Today, we look at a new high strategy for the stock market. This strategy is more like a pullback strategy, thus it offers great diversification benefits for a portfolio of strategies. We first published this strategy on our website about…
Today, we look at a rotation strategy for SPY, EEM, EFA, TLT, and GLD. The basic idea is that assets showing positive relative momentum have a tendency to continue outperforming over intermediate time horizons, while assets with poor momentum may…
Today, we discuss a price compression trading strategy. Markets often move from quiet periods to active periods. This simple observation is the foundation of many breakout strategies. When price movement becomes unusually narrow, it can signal that buyers and sellers…
Today, we look at something we have called the new low trading strategy. Markets spend most of their time making noise. Prices move up, down, and sideways, and most traders are tempted to react to every small fluctuation. But some…
The Russell 2000 Rebalancing Trading Strategy is a method that takes advantage of the abnormal outperformance of the Russell 2000 index during its annual rebalancing at the end of June. Traders buy on the close of the first trading day…
Today, we present a mean reversion strategy with a seasonal filter. Mean reversion assumes that prices often stretch too far in one direction and eventually snap back toward a more “normal” level. But there is a problem. A dip-buying strategy…
Today, we look at a pullback strategy for the S&P 500. Pullbacks are among the most common price patterns in the stock market. Instead of chasing a stock after it has already moved sharply, a pullback strategy waits for the…
Earnings seasons, the quarterly periods when companies release financial results, are known for sparking market volatility. Occurring in January, April, July, and October, these seasons are closely watched by investors aiming to capitalize on price movements. But can these periods…
Today, we are backtesting a simple stock market rotation strategy. Over months, the difference between U.S. stocks, developed international stocks, and emerging markets can be substantial. Sometimes the S&P 500 dominates. At other times, international markets take the lead. And…
Today, we look at a momentum strategy for stocks, bonds, and gold. Instead of trying to predict the next market move, this strategy follows what the market is already telling us. The Momentum Strategy for Stocks, Bonds, and Gold ranks…
Many traders secretly feel embarrassed about trading small size. They believe small positions are for beginners. They think they need to trade bigger to be taken seriously, to make meaningful money, or to prove they have confidence. But this mindset…
One of the most persistent stock market tendencies has been the tue turn-of-the-month effect. The idea is straightforward: stock returns have historically tended to cluster around the final trading days of the month and the first few trading days of…
Many traders spend years obsessing over mindset and risk management. While these are important, they are often used as a distraction from a harsher reality: If your strategy lacks a statistical edge (positive expectancy), you probably won’t make money regardless…
Today, we look at what the eighth wonder of trading is – compounding returns (the eighth wonder presumably said by Albert Einstein). Most traders focus on entries, exits, win rates, and indicators. But sometimes the biggest difference in long-term returns…
Today, we look at the Bullish Harami – a small candle with big reversal potential. The bullish harami is one of those quieter signals: a two-candle pattern that suggests selling pressure may be weakening and buyers could be preparing to…
I have been day trading since 2001. And I can assure you that successful day trading is mostly not what it looks like. When people first hear “day trading,” they often think about fast charts, quick decisions, constant action, and…
Today, we look at what we regard as the best reversal strategy. For decades, markets have shown a surprisingly persistent tendency to rebound early in the week after a rough start. It is simple and easy to backtest (and to…
Today, we show you a mean reversion strategy for Semiconductors. Why semis? Semiconductor stocks are among the most exciting, and volatile, corners of the market. They can trend strongly for long periods, but they also tend to overreact in the…
Today, we look at Larry Connor’s RSI strategy, published two decades ago, and show that it works just as well now as it did then. We have traded parts of the strategy since 2002, and we published the sell trigger…
Your best trading edge may not be a setup, indicator, or platform. It may be the traders you meet. If you connect with smart, adaptable traders, that is worth a ton more than anything else. The people you surround yourself…
Today, we’ll revisit a strategy we call the Low Risk Pullback Strategy. I first published this idea on the blog more than ten years ago, and it remains a useful concept for traders who prefer patience over chasing prices. Most…
The RSI Drop Trading Strategy is a systematic mean-reversion approach designed to identify these moments of temporary weakness. Instead of buying simply because a stock or market has fallen, the strategy uses the Relative Strength Index (RSI) to measure when…
Investors have a variety of options when it comes to investing strategies — Bond vs. Equity, Passive vs. Active, and Value vs. Growth strategy. Here, we focus on the two most popular strategies — Growth Investing and Value Investing. The…
Every quant who has stared at a backtest’s equity curve has felt the pull of a “hot streak.” A strategy wins five, six, seven trades in a row, and the temptation is to believe the model has found something real….
The CCI (Commodity Channel Index) is a technical indicator that measures the current price level of a security relative to an average price level over a given period. It is a momentum oscillator that is used to identify extreme conditions,…
Different order types can result in vastly different outcomes, which is why it is important to understand the type of order you use. If you want your order to be filled at your specified price, go for a limit order….
Meb Faber has several times stated that he is a trend follower at heart. In 2015, he published an article about a momentum and trend-following strategy called Meb Faber’s Three-Way Model in gold, stocks, and bonds. The model came from…
Today we will look at another trend following strategy developed by a famous fund manager long ago. It’s called Fabian Timing Model and was developed by Richard Fabian in the 1960s. The Fabian timing model is a simple quantitative long-term trend…
Image from: Pexels Profitable investors focus way more on managing unexpected swings than making accurate predictions. Most mainstream market commentary fixates on trying to guess the next major economic shift or corporate earnings report. However, experienced systematic traders know that…
Imagine making $100 million in a single day. That is reportedly what Paul Tudor Jones did during the 1987 stock market crash. But the most interesting part is not only how much he made. It is how simple the underlying…
Commodities, being closely tied to weather patterns and economic activity, exhibit high cyclical characteristics. Similarly, stocks also display cyclical tendencies. Given this, is there an opportunity to capitalize on their optimal performance? The commodities to equity ratio tries to do…
Momentum is one of the most studied anomalies in traditional finance, but applying it to cryptocurrency introduces a unique set of complications. Extreme volatility, regime shifts, and thin liquidity windows all affect whether a rules-based entry truly carries an edge….
Quantifying the FX robot advantage reveals a startling gap in performance because approximately 60% of automated retail traders generate positive annual returns, while 90-95% of manual traders find themselves consistently failing or losing money. The reason for this discrepancy is…
A trend following strategy for the S&P 500 is one of those ideas that seems almost too simple to work: be invested when the market is rising, and step aside when it starts falling. Despite this simplicity, the approach has…
Larry Connors‘ %b strategy is a mean-reversion strategy outlined in Chapter 5 of his book “High Probability Trading.” It involves buying when the close is above the 200-day moving average, and %b is below 0.2 for the last three consecutive days….
This article presents some trend following strategies on Bitcoin. Cryptocurrency markets have many of the characteristics of the commodities markets: Wild swings and gyrations, both up and down, exactly what is needed for trend following and momentum strategies. Does this…
Bollinger Band squeeze strategy is a popular approach for spotting low volatility breakouts before strong price moves begin. In all financial markets, volatility moves in cycles. Quiet periods with tight price action are often followed by sharp expansions in volatility….
The Death Cross trading signal is a staple of financial news, often used to spark fear when markets like the S&P 500 or Bitcoin begin to slide. But does this indicator actually predict a market crash, or is it just…
The end-of-month effect (also called the Ultimo Effect) is a well-known trading strategy in the stock market. We have covered this anomaly before. Perhaps what is lesser known is that the effect spills over to the first three days of…
The era of burning venture capital just to inflate user numbers has officially hit a wall. For years, the standard playbook for growth hackers was simple: pump money into social media ads, jam traffic into a funnel, and hope a…
You are going to learn about Bollinger Bands trading strategies with backtests and performance in this article. This guide explains how to use Bollinger Bands for strong market entry and exit frames, exploiting periods of market calm and volatility alike….
A MACD histogram trading strategy identifies trend momentum shifts by measuring the distance between the MACD line and signal line. Key strategies include buying when bars shrink below the zero line (bottoming) or expanding above it (uptrend strength), and selling…
The 5-Day Low of The Range Strategy, with its simple criteria of IBS lower than 0.25 and the close lower than the lowest low of the previous 5 days, has shown remarkable results. Over the period from January 1993 until…
Momentum trading strategies are the practice of buying and selling assets according to the recent strength of price trends. Traders who use the strategy aim to buy securities that have been showing an upward price trend and short-sell securities that…
Rule-based trading is a method of making trading decisions with predefined rules instead of making every call in the moment. A solid ruleset usually covers what market you trade, what has to happen before you enter, how you get out,…
Paroli strategy in trading means increasing position size after wins and cutting it back after losses. That makes it a positive progression system, usually treated as a capped anti-Martingale. The short answer is simple: Paroli can change the shape of…
Introduced by the ISM in 1948, ISM Manufacturing Index, or PMI, is a useful resource for assessing the health of the US manufacturing sector. It is one of the key macroeconomic indicators financial market traders monitor on economic calendars because…
Crypto markets are all about discipline, not hunches, which plays well with traders who like rules over noise. Infrastructure choices deserve the same practical scrutiny. Tools such as NuxGame crypto casino software can be viewed through a quantitative lens. Think…
Easter is a Christian holiday celebrated across the world. But does it affect trading on the U.S. stock exchanges and other financial markets? We look at how the stock market performs before and after the Easter holiday. Additionally, we specifically…
While retail participation in financial markets has surged since the mid-2000s, especially following the 2020 pandemic and events like the 2021 GameStop short squeeze, retail traders often face the daunting challenge of competing with high-frequency trading (HFT) algorithms. Finding proven…
Can we make a successful momentum trading strategy? Momentum trading is the opposite of buying low and selling high: momentum is about buying strength. Yes, a momentum strategy for the S&P 500 works. Let’s show you why a momentum strategy…
Heikin Ashi are a modified price representation designed to filter out market noise and highlight trend direction more clearly than traditional Japanese candlesticks. Originally introduced to Western markets in the 1990s, this charting technique has become popular among traders looking…
Somewhere underneath the slick mobile apps and instant payment confirmations sits a core system that might be running on COBOL written in 1978. Not a guess — a documented reality for hundreds of institutions worldwide. In 2026, open banking mandates,…
August 2021 marked my 20-year anniversary as a full-time investor (day trading 2001-18), and I have learned a few trading lessons. I started trading when I was laid off after the dot-com bubble and dumped by my girlfriend. I thought…
Most people walk into a casino — or open one on their phone — and treat it as a coin flip dressed up in neon. Traders and systematic thinkers rarely make that mistake. For anyone who has spent time modeling…
What happens to stocks when bonds go up? Any stock investor or trader should have a basic understanding of the relationship between stocks and interest rates. Why? Because the interest rates influence investors’ risk appetite. When interest rates are high,…
There’s a question that comes up constantly among traders moving from spot exchanges into derivatives: are CFDs and spot crypto just different packaging for the same thing? The short answer is no, and the longer answer matters a lot if…
The options expiration happens on the Friday before the 3rd Saturday of each month in the US. An often referred to effect is the options expiration week effect. Is this effect real, or is it just a myth? In this…
A moving average crossover strategy uses two or more moving averages to generate objective buy and sell signals based on trend shifts. When the lines cross, traders have a clear, rule-based trigger for potential entries and exits. This approach removes…
This article presents the 7 best algo trading strategies for beginners. This is meant as a jump-start for anyone looking to move away from subjective opinions and toward data-driven trading. Before diving in, it’s important to understand the key concepts…
Over the years, we have come to a simple but uncomfortable conclusion: You don’t lose money because you lack a strategy. You lose money because you misunderstand what trading actually is. You might eventually discover a promising system. It might…
In Chapter 6 of Larry Connors’ High Probability Trading, there is a trading strategy called Multiple Days Up (MDU) and Multiple Days Down (MDD). The books by Larry Connors, including High Probability Trading, are considered key resources for traders interested…
Is a stop loss good or bad? What is the best stop-loss trading strategy? Are there alternatives to a stop-loss? How many different stop loss strategies are there? One mantra is repeated when you read books and blogs about trading:…
Whether candlestick patterns actually work depends heavily on how you define your entry and exit rules, as academic research shows mixed results ranging from no added value to statistically significant predictive power. While some candlestick patterns show a measurable historical…
The Short Interest Strategies. Is high short interest good or bad? Short interest in trading has been a hot topic during 2021 after Gamestop made short-sellers run for cover at prices many times higher than their entry price. But was…
How many times have we witnessed in our trading systems how trades move against our position? Many! Well, in this blog post, we will see how to analyze this behavior in our trades and what conclusions we can draw from…
Image source: Pexels Why are institutional investors suddenly treating player health and game momentum like blue-chip stocks? In 2026, the answer lies in the data. Sports have evolved from a weekend pastime into a high-fidelity data stream, generating millions of…
This article presents an ETF rotation strategy. Sector rotation is popular and this is not without merit. The idea is to be in the sector that shows the best recent momentum. Today we present an ETF momentum rotation trading strategy…
This article presents an ETF rotation strategy. Sector rotation is popular, and this is not without merit. The idea is to be in the sector that shows the best recent momentum. Today we present an ETF momentum rotation trading strategy…
Today, we provide you 5 swing trading strategies with backtest and trading rules Swing trading is a trading style focused on profiting from short- to medium-term price swings in stocks, ETFs, or other assets. Swing trading work involves capturing these…
Volatility ATR Bands strategy is a rules-based trading approach that uses volatility measures to time breakouts and reversals. It overlays dynamic price bands (centered on a moving average) set by the Average True Range (ATR) to capture volatility-driven moves. In…
The SuperTrend indicator is a type of trend following indicator that was created by trader Oliver Seban. It signals the direction of a trend, its continuation, or changes in direction. The primary function of the SuperTrend indicator is to help…
Heikin Ashi is a modified price representation designed to filter out market noise and highlight trend direction more clearly than traditional Japanese candlesticks. Originally introduced to Western markets in the 1990s, this charting technique has become popular among traders looking…
What happens to stocks when bonds go up? Any stock investor or trader should have a basic understanding of the relationship between stocks and interest rates. Why? Because the interest rates influence investors’ risk appetite. When you buy a bond,…
Can we make a successful momentum trading strategy? Momentum trading is the opposite of buying low and selling high: momentum is about buying strength. Momentum trading is an investment strategy that differs from traditional buy-low-sell-high approaches, focusing instead on capitalizing…
The RSI 2 strategy stands as one of the most researched mean reversion approaches in systematic trading. Developed by Larry Connors in the late 1990s and refined through his books “Street Smarts” (1996) and “Short Term Trading Strategies That Work”…
There are different ways to skin a cat, they say; but in trading, especially short-term trading, a Multi-Timeframe Analysis trading strategy might stand a shoulder above all. This method is widely used in financial markets to identify market trends and…
The Williams Percent Range (WPR) indicator was developed by the famous trader and tax rebel Larry Williams, who has given names to several technical indicators. Williams %R does work. In this article, we explain how to use Williams %R in…
When a stock is overbought, we can expect weaker returns than average over the next few days. But in the long term, returns gravitate toward the average returns. Thus, overbought stock markets only predict short-term results – not long-term. This…
IMG Quant trading often sounds more impressive when it looks complicated. Dense models, layered indicators, endless filters, and highly technical language can create the feeling that a system must be advanced to be effective. In practice, that is not always…
