Trading smart means using the right tools to gain meaningful insights into the markets, find the right opportunities, and enter and exit the market fast, just like the professionals do — one tool that can help you achieve this is…
As traders, we rely on technical indicators and other analysis tools to study price movements and gain meaningful insights into the price action — one interesting indicator for tracking price swings is the zero-lag stochastic. What do you know about…
Many indicators are available for tracking price movements, but one common feature among them is lagging significantly behind price action — one indicator that tries to solve this problem is the Zero Lag MACD. What do you know about the…
Sifting through the randomness of price movements to identify trading opportunities can be a daunting task, even for seasoned traders, but one tool that promises to help our understanding of price action is the wave volume indicator. What do you…
An interesting thing about technical analysis tools, such as the Ergodic Oscillator, is that they enable traders to use statistical methods to tackle the randomness of the financial markets. What do you know about this indicator and its uses? In…
There are different ways of analyzing financial markets using price charts. Some traders make use of indicators, while others study the price movements and the patterns made by candlesticks. One common candlestick pattern used in spotting buying opportunities in the…
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…
In the trading world, people approach markets differently. While some use swing or position trading strategies, others trade intra-day and use intraday trading strategies. Wondering what intraday trading strategies are? Intraday trading strategies refers to a style of trading where…
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…
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…
Ascertaining the market condition is often necessary but can be very difficult, which is why the choppiness index can be very powerful for your trading. What do you know about the choppiness index? The Choppiness Index is an indicator created…
Machine learning trading strategies can predict market trends and make better trading decisions. This guide explains the essential strategies and techniques to leverage machine learning in trading. Key Takeaways **Top Machine Learning Trading Strategies for Predicting Market Trends** Machine learning…
Trading smart involves using the right tools to analyze the markets more effectively, and which tool reflects the price action than the Weighted Close. What do you know about Weighted Close in trading? In trading, Weighted Close is a technical…
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…
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…
There are many types of volume indicators traders can use to navigate the complex world of market analysis, and one of the best indicators to assess volume changes is the volume oscillator. What do you know about this indicator? The…
As traders, we rely on different tools to analyze the markets effectively and gain useful insights into the price trend, and only a few tools can do it as well as the linear regression indicator does. What do you know…
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…
As traders, we rely on different technical analysis tools to gain valuable insights into market movements and attempt to predict the future price direction — the KST oscillator is one tool that is worth checking out. What do you know…
There are many technical indicators and analysis tools traders can use to track how the market is moving, and one that is growing in popularity is the Disparity Index. What do you know about this indicator? The Disparity Index is…
Nick Radge’s Weekend Trend Trader trading strategy is a mechanical and systematic trading system designed for part-time traders, allowing them to make decisions and manage trades during the weekend when markets are closed. In this article, we explain the Weekend…
In the fast-paced financial trading world, using the most responsive indicators for your technical analysis is key to catching the right moves in time, and this is where the Adaptive Laguerre Filter comes in. What do you know about this…
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,…
Today we are presenting three free mean reversion strategies. They were partially published on this website a few years back, and today we make some minor adjustments and present their performance on different ETFs. Furthermore, we discuss why mean reversion…
Analysis of the financial markets today has become so much more scientific, as professionals from different fields of science try hard to solve the market puzzle, and this has led to indicators like the Prime Number Bands. What do you…
In the fast-paced world of financial trading, everyone is looking for better tools to improve their technical analysis, and one such tool is the High-Low Bands indicator. What do you know about this indicator? The High-Low Bands are two lines…
The financial markets may seem random in the way they move, but with certain technical analysis tools, like the Zigzag Fibonacci, you might find that the movements follow a certain pattern. What do you know about the Zigzag Fibonacci? In…
Previously I wrote an article about the detrimental effect of using stop-loss. What happens if we reverse it? Does using a profit target create any value? When trading it’s mentally very hard to see a nice gain turn around into…
Three german researchers have written a study called Is Poker a Game of Skill or Chance? A Quasi-Experimental Study. I was made aware of this article in Peter Warrens’s blog (only in Norwegian). I totally agree with the content. Most…
Zero-lag exponential moving average strategy backtest (ZLEMA) The moving average is no doubt one of the most widely used technical indicators. While there are different traditional types, many variations are being created all the time to improve on the old…
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…
I believe experience is the most important asset for any speculator. In this article, I explain why experience matters in trading. It’s simple: the longer you survive, the fitter and stronger you get, and thus more fit to prey on…
I guess most traders have heard that “the trend is your friend“. Personally, I don’t do trend-following strategies, I go the opposite way: buy weakness and sell strength – mean reversion strategies. However, this depends on the instrument you trade…
You can develop and create profitable short-selling strategies and systems, but you can’t expect to find many; they normally trade infrequently. This article presents several short-selling strategies in the S&P 500 (SPY and ES) and consumer staples (XLP). Moreover, we…
The 5-Day Low Overnight Trading Strategy focuses on trading the S&P 500 when it opens at a 5-day low but closes higher than its opening price. This strategy involves entering trades at the close and exiting when the market opens…
This article presents a SPY volume trading strategy. Understanding the significance of trading volume in SPY and the S&P 500 ETF is crucial. This article explores the relevance of volume in SPY trading and presents findings from historical data analysis…
Pairs Trading Strategy involves being neutral to the direction of the market. This article looks at what pairs trading is, how it works, and its advantages and disadvantages (pros and cons). The main benefit of pairs trading is market neutrality….
The Weighted Moving Average (WMA) is a valuable technical indicator employed by traders to assess the direction of trade and assist in making informed decisions on when to buy or sell. This article looks at the math, theory, and basics…
Does trend following work in the S&P 500? We recently came across an article called Breaking into the Blackbox: Trend Following, Stop Losses, and the Frequency of Trading: The Case of the S&P 500. It’s written by academics, but in…
The Dow Theory is widely considered one of the earliest forms of technical analysis in the western world and has always been a very integral part of technical analysis since then. But what is the theory about? The Dow Theory…
Trading SPY And S&P 500 Using VIX (VIX Trading Strategies). The VIX is a popular measure of the implied volatility of S&P 500 index options. Put shortly, the VIX is a mean reversion indicator: when the risk premium increases (VIX…
Variable moving average strategy backtest Traders have always looked for ways to improve the performance of the exponential moving average, and using a volatility index (VI) to adjust the smoothing period as market conditions change has given rise to the…
Dogs Of The Dow (DOD) Some investment strategies allow you to enjoy maximum dividend income, and Dogs of the Dow is one of such. But what does it really mean and how has it performed lately? Dogs of the Dow…
A market-neutral strategy is a type of investment approach that enables an investor to benefit from both rising and falling stock prices. This is achieved by taking long positions in one stock and short positions in another stock. The strategy…
Of the many classifications a stock can have, one of the most significant is relative to its size. It is well known in the market that small caps tend to perform better than large caps, something called the small-cap effect….
The stock market is officially open for 6.5 hours daily and has an opening and closing price for each stock. What is the opening price of a stock? The opening price of a stock (or any asset on an exchange)…
With the tight regulations that followed the 2008/2009 financial crisis, this sector has been stable with steady growth. But let’s see what it has to offer. In this article, we discuss the US financial sector and we show you an…
When should you sell a stock or position? Many articles and videos deal with when to buy, but less focus is on when to sell. When should you sell? What method should you use to sell? What is the best…
The information technology sector has the highest weighting in the S&P 500 index, representing more than a quarter of the index’s market cap. Over the last decade, the sector has been “hot” and had a spectacular bull market. In this…
Identifying core strengths, weaknesses, opportunities, and threats leads to fact-based analysis, fresh perspectives, and new ideas, which are the benefits of a SWOT analysis. SWOT analysis is a technique for assessing the performance, competition, risk, and potential of a business,…
The Utilities sector is known to outperform the S&P 500 index when there are market downturns, especially during periods of recession. Let’s take a look at the sector and discuss an example of an utilities trading strategy. Utilities trading strategies…
Today we will look at a strategy published by Michael Gayed in his paper An Intermarket Approach to Beta Rotation: The Strategy, Signal and Power of Utilities. Gayed’s paper is among the most downloaded papers on the SSRN website. The…
A big part of a successful trading strategy is seasonal trading. As we are about to see, this is especially true in commodities. Today we will look at a silver seasonal trading strategy where we invest only in the best-performing…
The advent of Artificial Intelligence is here, and is forecast to combine with and revolutionize many industries in the years to come. One such combined industry is ‘Robotics and AI’, and traders are increasingly seeking ways to position themselves to…
The material sector is considered the primary producer in the supply chain because the companies here provide the raw materials used by other industries. Stocks in this sector tend to do well in a strong economy. However, the sector is…
Bear market strategy refers to the techniques traders and investors use to trade the market during a bear run. They include entry, exit, trade management, and risk management strategies investors use to protect their assets and even make some profits…
One of Warren Buffett’s investment advice is, “Be fearful when others are greedy and greedy when others are fearful!” That basically explains the contrarian trading strategy. The contrarian trading strategy is one that goes against the prevailing sentiment in the…
Energy sector trading is the process of gaining exposure to multiple stocks in the energy sector as a means of diversification and generating profits. Investment can be done by buying an ETF that tracks the sector or by building a…
Below we have a few selected End-Of-Day Trading Strategies. (EOD trading strategies) Since we started writing in 2012 we have presented over 200 free trading strategies, and we present a monthly trading edge for our paying subscribers (which you also…
What Does A Follow Through Day Mean In Trading? As a stock trader, you may likely have asked this question several times: “How do you identify a stock rally?” That might have been the question that led William J. O’Neil…
Stock indexes are widely used as benchmarks for tracking a basket of stocks within a particular sector or segment of the market. Investors use the indexes to assess the overall health of the sector, they compare the performance of their…
IWM is the ticker symbol for iShares Russell 2000 ETF, which is one of the main ETFs that track the Russell 2000 index. The ETF provides a way to invest in the index and gain exposure to small-cap U.S. stocks….
The real estate industry group, previously stuffed inside the Financials sector, was elevated to a market sector level in 2016, making it the 11th sector in the S&P 500 index. Let’s take a look at the newest addition to the…
Channel trading can be profitable when used correctly. It can help you to track and speculate on the prevailing market trend, especially if you are a swing trader. But it can also be used in range-bound markets. Both mean-reversion traders…
Volatility goes up and down in any financial market. Low volatility is often followed by periods of high volatility and vice versa. Bollinger Bands are one of the tools a trader can use to measure volatility. What is the Bollinger…
Investors and analysts are always looking for ways to analyze the market, and one method of evaluating the current price of a stock to determine whether it is relatively overpriced or underpriced compared to the average trading price for the…
One often-mentioned expression in the financial markets is “risk on risk off”. What is it, and can you use it to develop a profitable risk on risk off trading strategy? A risk on risk off trading (RORO) strategy takes advantage…
Taking advantage of the popularity of Tradingview and its powerful tools for technical analysis, we will explore Bollinger Bands and their potential for creating a trading strategy. Stay with us until the end to see how we use the tools…
A Russell 2000 Death Cross occurs when the 50-day moving average of the Russell 2000 index crosses below its 200-day moving average. This is often seen as a bearish signal, but a new study by Rob Hanna on his blog…
How do you do overnight trading? Is it possible to make money via overnight trading? Can you make money by owning stocks or indices for just one day? Is overnight trading good? You do overnight trading by buying the close…
Are there any daily seasonalities in the S&P 500? I did some research into SPY, an ETF based on the S&P 500 components and a very good proxy, based average return on which day of the month. To get a…
Gap down trading strategies in stocks capitalize on downward price gaps between trading sessions. This strategy outlines specific entry and exit criteria to exploit these opportunities effectively. Entry occurs on the next trading day if certain conditions are met, while…
In 2022 the bond market experienced the worst drawdown in its history, and since then volatility has been off the charts. It seems like rates are moving like tech stocks did in 2000. Luckily, this can be seen through the…
Hull moving average strategy backtest Experienced traders know that the best trading indicators are those that can reduce lag, eliminate noise, and quickly respond to sustained market changes. The Hull Moving Average (HMA) seems to tick those boxes. What do…
Simple Moving Average Trading Strategy revolves around the use of a simple moving average (SMA), which is a technical analysis tool that helps traders identify the direction of a market trend by averaging the closing prices of a security or…
Gap fill trading strategies are popular among traders, especially when it comes to playing the opening gap of the S&P 500. But what exactly is an opening gap? This article explores the basics of gap trading strategies, focusing on understanding…
Wheel Trading Strategy The wheel trading strategy is a popular options trading strategy that involves generating income from options by buying and selling puts and covered calls. It is a systematic approach to trading options, allowing investors to potentially generate…
Is there a safe investment asset strategy? A while back, Meb Faber published a white paper called What Is The Safest Investment Asset. Faber wanted to answer if there is such a thing as the safest asset in the world….
Meb Faber’s Tactical Asset Allocation strategy is an active trend-following strategy that uses market timings and allocates assets across four asset classes: stocks, bonds, REITs, and commodities. These four asset classes are divided into five categories: U.S. stocks, foreign stocks,…
Italy is one of the most beautiful countries in the world, and it certainly has one of the best foods. However, they have struggled to grow their economy and, accordingly, their stock market. The Italian stock market is currently trading…
The PENTAD Timing Model By Nelson Freeburg is an active, complicated strategy that uses four stock indices and one advance/decline line for producing buy/sell signals. This timing model is designed for the US stock market. Using this timing model, you…
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:…
Let’s look at at price pattern that shows that Tesla’s stock price booms every time this happens. It doesn’t happen often, but it has worked well so far: Tesla’s Stock Price Booms Every Time This Happens The trading rules are…
In May 2015, Micheal A. Gayed published a paper called Lumber: Worth Its Weight in Gold Offense and Defense in Active Portfolio Management (free download at SSRN). We used that paper to make a profitable lumber/gold ratio trading strategy for…
