What is the Ease of Movement Indicator? The Ease of Movement (EMV) is a volume-based oscillator developed by Richard Arms that quantifies the relationship between price change and volume. It identifies the “path of least resistance”: a large price increase…
What is the True Strength Index Indicator? The True Strength Index (TSI) is a momentum indicator that is based on a double smoothing of price changes. It is an oscillator, swinging between limits of -100 and +100, with 0 as…
Understanding volume analysis is very necessary for successful trading, and one indicator you can use for such analysis is the Volume Rate of Change (VROC). Do you know about this indicator and how to use it? In trading, the Volume…
One thing about the financial trading world is that traders are always looking for more tools to analyze the markets, and one such emerging tool is the Relative Volatility Index (RVI). What do you know about this tool and how…
In the fast-paced world of financial markets, traders are always seeking new indicators to perform better technical analysis and improve their trading game — one such indicator is the Range Expansion Index (REI). What do you know about this indicator?…
Determining the right mix of assets to help you reach your short-term and long-term financial goals is the key to building a winning investment portfolio. For many years, financial advisors and experts recommend the 60/40 portfolio because of its simplicity…
Seasonality has long been used in trading and investing: the idea that certain patterns in market returns repeat at similar times each year. In his book Quantitative Investing: Strategies to Exploit Stock Market Anomalies for All Investors, Fred Piard explores…
In the trading world, there are many technical indicators to help you understand market trends and many more are being created — one such indicator is Polarized Fractal Efficiency (PFE). What do you know about this indicator? Polarized Fractal Efficiency…
What is the Relative Vigor Index (RVI) Indicator? The Relative Vigor Index (RVI) is a technical analysis indicator that measures price momentum by comparing the closing price to its trading range and using a simple moving average (SMA) to smooth…
Key Summary: What is the Order Flow Trading Strategy?An order flow trading strategy is a method of trading that is based mainly on watching the flow of trading orders and the impact those have on the current price of an…
Few concepts are as enduring as momentum and trend following. A recent research paper titled “A Century of Profitable Industry Trends”, authored by Carlo Zarattini and Gary Antonacci, explores a systematic approach to capturing these trends over a 100-year horizon….
What is the best swing trading strategy? Is swing trading still profitable with positive returns? We have summarized 10 free swing trading strategies that might help you start your trading career. The internet is flooded with anecdotal evidence about how…
The January Barometer is a seasonal trading strategy that worked over many decades. While the traditional January Effect seems to be arbed away, the January Barometer has worked well for many decades. This is the January effect that works – the January…
This blog post explores fascinating new evidence from a research paper titled “From Red to Blue: The Long-Run Inversion of Political Cycles and Stock Market Returns Over 153 Years” by Han, Lu, Xu, and Zhou. The paper documents a fundamental…
There are several ways to smooth price data using the moving average technique, and one of the interesting averaging methods is the Modified Moving Average (MMA). What do you know about this MMA indicator? Also known as the Running Moving…
With trading strategies, there are many different ways to trade and as many different types of trading strategies. It’s important to remember that what works well for one person might not yield the same results for you. Conducting thorough data analysis and data-driven backtesting,…
This strategy, which we found in a research paper by Carlo Zarattini et al., titled An Effective Intraday Momentum Strategy for S&P500 ETF (SPY), focuses on exploiting intraday trends in the S&P 500 ETF (SPY) driven by persistent supply-and-demand imbalances….
Here we are presenting a lot of very interesting Day Trading Statistics that will probably shock or at least surprise a lot of readers. Day trading has witnessed a surge in popularity. The rise of internet trading platforms and social…
This article looks at the world of trading, uncovering trading statistics, truths, facts, and realities that shed light on many things you probably didn’t know about trading in stocks, futures, ETFs, and crypto. But first some key takeaways. Key Takeaways: Trading…
A compelling approach to tactical asset allocation is the global equities momentum strategy, originally called “Enhanced” Global Growth Cycle (GGC) strategy, developed by Grzegorz Link, and referred to by Allocate Smartly. This strategy builds on the original GGC by combining…
Interested in optimizing your market timing and trend identification with moving average trading strategies? This comprehensive guide delves into the intricacies of utilizing fundamental moving averages such as the SMA and EMA. Explore techniques for refining entry and exit points,…
Volume is one of the most overlooked aspects of technical analysis. Most traders rely heavily on price indicators, even though volume can reveal hidden momentum and confirm (or contradict) price action. One way to quantify volume strength is to use…
In this article, we present you a Gold Momentum Trading Strategy, originally based on research by Cyril Dujava of Quantpedia, suggests that gold performs significantly better when its momentum aligns with that of other asset classes – specifically US Treasuries….
Traders often look for ways to measure the price momentum. The rate of change (ROC) is one of the most commonly used indicators for that. Let’s take a look at the indicator. Often referred to as the momentum indicator, the…
Every market cycle eventually reminds investors of the same uncomfortable truth: stocks do not always go up. When drawdowns occur, the natural question becomes which assets actually protect capital when equities fall. Defensive assets are supposed to do exactly that….
There are many tools traders use to navigate the ever-changing landscape of financial markets, but in markets with real volume data, no one does it better than volume indicators, such as the Accumulation/Distribution Line. What do you know about this…
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,…
Recently, we came across an interesting research paper called A Unified Framework for Anomalies Based on Daily Returns by Nusret Cakici et al. The authors examined the price performance of stocks over the past 21 trading days and rebalanced the…
Is it possible to use the ADX indicator (Average Directional Movement Index) (DMI) to find a profitable ADX trading strategy? This article looks at the ADX indicator where we make some historical backtest to evaluate and analyze. The adx indicator…
In finance, markets are generally believed to be efficient, meaning predictable patterns should quickly vanish through arbitrage. However, groundbreaking research by Heston et al. (2010, 2011) uncovered a peculiar regularity: the intra-day stock return periodicity puzzle. This puzzle describes a…
The Chaikin Oscillator Indicator was developed by Marc Chaikin in the 1980s. It’s not widely used nor well-known, perhaps for good reasons: we didn’t manage to find any significant profitable Chaikin Oscillator Trading Strategy in any of the quantified tests we…
Adapted from the original article by Ben Carlson on A Wealth of Common Sense. Investing in the stock market isn’t a guarantee of smooth gains. Instead, it’s a mathematical game of odds, and understanding those odds is critical for long-term…
Technical indicators offer powerful insights into what is happening in the market. While price is a factor in technical analysis, volume is as important as price as this tells traders the level of activity on a given security. The On-Balance…
Bond trading strategies are a great inclusion in a portfolio of strategies because they offer diversification and, most likely, uncorrelated returns. Bonds are complementary. First, you might want to have a look at other articles related to bond trading strategies:…
The exponential moving average strategy is one of the most commonly used among traders. But do you know what it is? And do you know if an exponential average strategy can be used profitably in the stock market? Backtests indicate…
The “Lazy Man’s Momentum Strategy” stands out for its simplicity. The rules are straightforward: every six months, the strategy looks at 22 country indices and buys the 11 with the highest 6-month return. This is a strategy we first identified…
How and when should you exit a trade? Most articles about trading center around when to buy (or sell short) or how to deal with the psychological aspects. Hardly anything can be found about exits, even though when to exit…
For decades, traders have used momentum strategies, the idea that past winners keep winning, to find success in equity, currency, and commodity markets. While most research focuses on long-term trends over months or years, a groundbreaking study by Wen et…
(Source) As the gaming sector continues to undergo significant transformation, assessing gaming stocks requires a more detailed understanding of this burgeoning sector’s multi-layered dynamics. In 2026, various factors will influence which gaming stocks might perform well, and being aware of…
In the ever-changing landscape of financial markets, traders sometimes refabricate old indicators to improve their market analysis and spot trend changes in time — one such indicator is the Composite Index Divergence Indicator (CIDI). What do you know about the…
In a recent research paper titled “Returns to Constant Leverage Strategies: General Principles and Application to Levered Single-Stock ETFs,” Professor Hendrik Bessembinder of Arizona State University provides a deep dive into the mechanics and risks of the rapidly growing levered…
https://www.youtube.com/watch?v=NdnJX4kjPQM Imagine a trading strategy so simple it takes just five minutes a year to manage, yet it has outperformed the Nasdaq for over a decade. That’s exactly what @thechartist showed on X. This strategy, pairing two ETFs with a…
A recent quantitative study examined the feasibility of generating abnormal returns (alpha) in the highly specialized commodity futures market by utilizing common technical indicators: the Moving Average Convergence Divergence (MACD) and the Relative Strength Index (RSI). This research investigated whether…
Williams %R was developed by the famous trader and tax rebellion Larry Williams, who has given names to several technical indicators. Last week we wrote about the WilliamsVixFix indicator, and today we are explaining the Williams %R trading strategy and…
Christmas Day is one of the federal holidays in the US. It’s a well-known “fact” that there is normally a Santa Claus rally in stocks, but do we see the same tendencies in the gold price? Is there a Christmas/Santa…
Christmas Day is one of the federal holidays in the US. But how does it affect the US financial markets? Is there a Santa Claus rally in stocks? Can we develop trading strategies for this holiday season? Our trading strategy…
(Source) Trading simulations offer a clean way to see probability at work when outcomes feel uncertain. Markets and casino games look different, yet both run on the same arithmetic. A 2023 review from Insider Monkey pointed to probability and statistics…
This article challenges the conventional wisdom that long-term investing in triple leveraged ETFs (TLETFs) is an “anathema” due to issues like daily rebalancing and “beta slippage” or the “constant leverage trap,” which often lead to poor long-term performance. We show…
It is important to be able to identify the beginning of a new trend; equally, it is also important to be able to identify the end of a trend. A well-timed entry fits perfectly with a well-timed exit. The parabolic…
For many, the approach is to buy low and sell high. But that is not the case with the 52-week high trading strategy – you do the opposite. What is the 52-week high trading strategy? The 52-week high strategy is…
Understanding volume and price, and how they can influence the market, is very important in trading. Since volume is the measure of activities in the market, traders can use the information provided to increase the probability of their trades. A…
How a psychological bias – the repurchase effect – predicts lower future stock returns. We show you a investor regret trading strategy. Have you ever sold a stock too early and watched it soar—and felt that pang of regret? What…
What Is the Laguerre RSI? This article is a practical short guide for traders. The Laguerre RSI is a lesser-known but highly effective momentum indicator developed by John Ehlers. It aims to improve on the traditional Relative Strength Index (RSI)…
Forget gold and options: This Factor-Based Strategy Is the Ultimate Crisis-Proof Investment (plus trend/following). A common investment strategy involves balancing risk and return with a traditional portfolio split: 60% stocks (equities) and 40% bonds (the 60/40 portfolio). While this portfolio…
In this article, we backtest Larry Connors‘ 3 day high/low Method/Strategy. How has the strategy performed since it was revealed in his book in 2009? The 3 day high/low method/strategy performed well in Connors’ book, and it still works pretty…
Can we develop a Thanksgiving holiday seasonal trading strategy? Is Thanksgiving bullish or bearish for stocks? Thanksgiving Day is one of the federal holidays in the US. The day after Thanksgiving is called Black Friday and is a day when consumers…
Among the tools available for analyzing the markets, oscillators are some of the most interesting for tracking the momentum of individual price swings — one that seems to do a damn good job is the Pretty Good Oscillator (PGO). What…
The triangle pattern is one of the common chart patterns you will encounter when analyzing stocks for short-term trading, and the most reasonable way to trade the pattern is the breakout strategy. What is the breakout triangle strategy? The triangle…
Hindenburg Omen Indicator Trading Strategy: how do you use it and what is it? Stock market crashes can wipe out traders’ and investors’ profits or even put them at a huge loss in no time. If you have been in…
Chart patterns can help you understand the condition of the market. The double top pattern can warn you about a market peak, but do you know what it is and how to identify it? The double top chart pattern trading…
Super Bowl Sunday is more than the biggest night in American sports. It is a cultural event that drives massive consumer spending on food, beverages, advertising, and merchandise. Investors often watch how certain companies perform around the game to gauge…
Learning how to accurately identify and analyze the double bottom chart pattern trading strategy can help you read market conditions and determine when to look for buying opportunities. But what is this double bottom chart pattern? The double bottom chart…
Just as traders use technical indicators to attempt to predict the future direction of an asset, quantitative analysts also utilize various statistical and mathematical models to forecast the future values of assets, with one of these models being the Kalman…
There are countless technical indicators that traders look at. Among the most popular that try to gauge momentum are the RSI and the stochastic indicator. However, today, we will learn about one that is not so well-known: Chande momentum oscillator…
If you’ve dipped your toes into cryptocurrency, you know how wild the market can be. Unlike traditional assets like stocks, which are tied to company fundamentals, crypto prices are driven almost entirely by simple supply and demand. This reliance means…
Gaps are a common feature in financial markets, and traders often wonder what happens after a gap down at the open. Does the stock market usually keep falling, or does it bounce back during the day? There is a 47%…
The magic behind Jim Simons’ trading strategies consists of collecting an enormous amount of data and analyzing the data to find statistical patterns and non-random events in a wide range of markets. Furthermore, Jim Simons and Renaissance Technologies have put…
Connors RSI trading strategy often referred to as CRSI, is a momentum-based oscillator and indicator that tries to improve on the original 14-period RSI indicator developed by Welles Wilder. Unlike the original 14-period RSI indicator, the CRSI uses 2 periods…
The Copper/Gold ratio trading strategy seems to offer good entry points for both copper and gold. We backtest the ratio and find positive results for the next one to 12 months after a signal is triggered. Copper and gold are…
Profit Factor is a key performance metric used in trading to assess the profitability of a trading system or strategy. It’s calculated by dividing the total profit generated by winning trades by the total loss incurred from losing trades. Essentially,…
Today we test Larry Connors‘ R3 strategy and we continue backtesting the trading strategies Larry Connors and his team published in 2009 in a book called High Probability ETF Trading. All the strategies were tested on a basket of 20…
In this post, we’ll walk you through three long-term trading strategies that aim to reduce drawdowns, ride bull markets, and potentially outperform buy-and-hold with less stress. These are the 3 long-term strategies that work: 1. The 200-Day Moving Average Strategy…
There are different types of tools and indicators professional traders can use to track markets and price action, but oscillators seem to suit swing traders more, which is why the Gator Oscillator was created from the already existing Alligator indicator….
In the world of finance, professional financial analysts play an important role, directing the allocation of capital through in-depth research. When analyzing a company, analysts typically conclude their reports with a recommendation, usually categorized as strong buy, buy, hold, sell,…
The phenomenon known as the overnight effect or overnight drift is a significant topic in quantitative finance, referring to the tendency of asset returns during non-trading hours to exhibit substantial patterns. This drift has been well-documented across numerous asset classes,…
What is the MAR Ratio and Why Should You Care? The MAR Ratio (Managed Accounts Report Ratio) is arguably one of the most important yet underutilized performance metrics in trading and investing. Named after the Managed Accounts Report newsletter, where…
Why day traders fail boils down to at least 16 reasons. This article explains why day traders fail and what you can do to survive and perhaps even prosper. Why day traders fail is mainly because they don’t understand the…
The lunchtime effect in the stock market, particularly in the U.S., refers to a noticeable pattern where trading volumes and returns drop during lunch hours, typically between 11:30 AM and 1:00 PM. This phenomenon has been observed across various markets…
The relationship between gold mining shares and gold bullion is often misunderstood. While gold miners move with gold prices because their revenue depends on the price of gold, they exhibit a clear long-term underperformance compared to the physical metal. We…
Market participants often discover that digital asset price movements are not distributed evenly throughout the day, with specific hours exhibiting higher volatility and liquidity. By identifying these recurring temporal patterns, you can determine whether execution timing can influence the statistical…
A recent academic paper titled “An Information Factor: What Are Skilled Investors Buying and Selling?” introduces a fascinating, evidence-backed trading strategy that builds on a deceptively simple premise: Follow the money — but not just any money. Follow the informed…
One of the most challenging tasks in forex trading has always been catching market turning points. Reversals are situations in which trending moves lose momentum and the price moves in the opposite direction, often quickly and more violently. Old-fashioned traders…
The increasing accessibility of computational power and public data has recently spurred greater investor reliance on technical analysis techniques. This environment makes it feasible to evaluate and back-test various trading methodologies thoroughly. Technical analysis aims to derive an optimized approach…
In the long term, gold has proved itself as an inflation hedge, but not in the short term. Gold is often viewed as the world’s oldest financial asset, possessing a reputation as a crucial safe-haven asset, particularly during times of…
Why Bitcoin is Called ‘Digital Gold’ Bitcoin is a relatively new asset, having debuted with the white paper by Satoshi Nakamoto in 2008. While gold has existed throughout human history, Bitcoin has quickly grown, achieving a market value of over…
The options market has traditionally been considered the domain of sophisticated institutional investors, but recent years have seen a dramatic shift. Facilitated by the advent of zero-commission trading on apps like Robinhood, retail investor activity in U.S. options has soared,…
The $3.5 billion “secret”: how a bias skews S&P 500 option payoffs every month! In this blog post, we tell you how retail and prop traders make money on the options expiration day (OPEX). For investors and traders in the S&P…
In an age dominated by machine learning, high-frequency trading (HFT), AI, and complex black box models, it’s easy to believe that only the most sophisticated strategies have any edge left. But it’s not! If simple can succeed, why complicate things?…
When traders think about diversification, they often focus on spreading risk across different stocks, sectors, or asset classes. But few consider the powerful benefits of adding gold strategies to their trading portfolio. Gold has historically behaved differently from equities, bonds,…
The systematic global macro investment style, labeled Macro Momentum, is grounded in economic theory and aims to capitalize on the tendency of market participants to underreact to news by positioning on the basis of fundamental macroeconomic trends. In general, such…
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…
The Recession Fear Index (RFI) is proposed as a direct measure of recession concerns based on Google search activity. The development of the RFI is premised on the shift toward active information-seeking by market participants. The search frequency data derived…
Traditional equity and commodity markets frequently exhibit a well-documented pre-holiday effect, where returns on trading days immediately preceding public holidays tend to outperform other days. This anomaly is classified as one of the most substantial calendar effects in the stock…
The worst week of the year for stocks is the last week of September, after the third Friday of the month. September is a poor month for stocks, especially the week after OPEX day, which is the third Friday of…
While some prominent investors, like Warren Buffett, advocate for highly concentrated portfolios, believing diversification is unnecessary for those who “know what they are doing”, academic research and empirical evidence suggest the opposite. Nobel Prizes in financial economics have been awarded…
In recent years, the cryptocurrency market has rapidly transformed from a niche innovation into a significant segment of the global financial system. By March 2025, its total market capitalization soared past $3 trillion, with over 100 cryptocurrencies individually exceeding $1…
This post looks into a recent study titled “Does Trend Following Still Work on Stocks?” by Zarattini, Pagani, and Wilcox, which extends the foundational 2005 work by Wilcox and Crittenden. We emphasize that we at QuantifiedStrategies.com have NOT backtested or…
Have you ever wondered if it’s possible to profit from stocks that experience significant one-day drops? New research sheds light on economically significant short-term price reversals, offering insights for traders looking to refine their strategies and potentially achieve substantial returns:…
Is gold truly the inflation-proof sanctuary many believe it to be? While its allure as a safeguard against rising prices has long been celebrated, particularly after the turbulent 1970s, recent comprehensive analysis reveals a far more nuanced reality. Far from…
Do you sometimes wonder what separates successful traders from the 90% who fail? The answer isn’t better market predictions or secret indicators – it’s understanding the mathematics behind trading success. Most retail traders approach markets trying to predict where prices…
