Do you want to trade the Nasdaq 100? We bring you 3 trading strategies to help you get started trading. The strategies are backtested on the ETF with the ticker code QQQ, which tracks the Nasdaq 100. We have not…
When the Federal Reserve announces a rate cut, the financial world often holds its breath. But what does this mean for the stock market, particularly the S&P 500, when the FED makes its first-rate cut? A fascinating chart from Goldman…
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…
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…
QQQ – TLT Strategy (With backtest and trading rules) A Bond and Nasdaq 100 trading strategy. This strategy trades the NASDAQ 100 and long-term treasury bonds from the long side, using the ticker codes QQQ and TLT. We include interest…
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,…
Compounding in trading involves reinvesting your profits for exponential capital growth over time. This blog post will guide you on how progress compounds in trading and present key strategies for maximizing returns. You’ll learn to set effective goals, develop a…
Are all-time highs in the S&P 500 bullish or bearish? This is a common question among investors when the market hits new peaks. Understanding whether new highs signal continued growth or a potential downturn is crucial. In this article, we’ll…
U.S. credit spreads reflect economic conditions and investment risks. High spreads indicate higher risk and economic uncertainty, while low spreads suggest stability. This article explains what U.S. credit spreads high and low: what does it mean, and how they affect…
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…
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…
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…
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…
Introduction to the Z-Score Trading Strategy: The Z-Score is a statistical measure used in finance to assess a company’s financial health and its likelihood of bankruptcy. The Z-Score Trading Strategy employs this metric to make improved investment decisions. The Z-Score…
Introducing the “3 Day Low Trading Strategy”! This strategy is based on Larry Connors’ double 7 method and aims to capitalize on the stock market’s mean-reverting tendencies. It involves identifying ETFs that close at a 3-day low and have an…
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…
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…
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…
Today we’ll present a strategy that we first wrote about some years ago – an article called big moves on Mondays – but we have made a small twist to the strategy. We call the strategy for the Big Reversal…
In this article, we present some Larry Williams trading strategies. Larry Williams has marked his name in the register of successful traders. He has authored several books and is very popular in the trading industry. Born on 6th October 1942,…
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…
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….
QQQ Trading Strategies and Systems The QQQ is the largest and most liquid ETF that tracks the Nasdaq Composite Index. It is a popular investment vehicle for both individual and institutional investors. However, successfully trading the QQQ can be challenging…
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….
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…
Momentum trading is the opposite of buying low and selling high: momentum is about buying strength. Can we make a successful momentum strategy for S&P 500? Yes, a momentum strategy for the S&P 500 works. We use monthly bars and…
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,…
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…
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…
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…
How important are the best days compared to total profits? In trading, you want to avoid negatively skewed trading strategies. These are strategies that have fat left tails and might wipe out all your profits from many trades. You need…
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…
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…
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…
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…
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…
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…
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…
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…
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….
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…
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…
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…
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…
The common belief is that large-cap stocks don’t perform very well because they are already big and they don’t grow at high rates. However, is this true? What is the large-cap effect (factor) trading strategy? In this article, we are…
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…
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…
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….
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…
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…
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…
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…
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…
This article shows a rotation strategy between healthcare stocks and the S&P 500. The trading idea is pretty simple, but it beats the buy and hold of the S&P 500. Moreover, we believe this strategy is more rational than at…
The world of stock trading is a dynamic and ever-evolving landscape, where traders employ a wide array of strategies to capitalize on market movements. However, sometimes very basic strategies can perform really well. The 5 consecutive higher open trading strategy…
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…
S&P 500 trading strategies can sharpen your market understanding. This article delivers straightforward techniques for trend, momentum, and volatility trading, providing the know-how for strategic market engagement. Understand when to enter and exit the market with strategies suited for different…
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…
What are the worst days of the year for trading stocks? Let’s find out and test from the year 2000. We did a backtest where we optimized the month and trading day to find the WORST trading days for the…
The utility sector has taken a major hit over the last couple of weeks. Below is XLU, the ETF that tracks the sector: But as you can see, it’s not the first time it has “collapsed”, but it has caught…
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…
Triangular moving average strategy backtest Moving averages are the most common and useful technical indicators in forex trading, owing to their effect in smoothening out price movements and showing the actual direction of the trend. There are various types of…
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…
What happens in the coming days after a very bad Friday when the stock market goes down? Let’s backtest and find out if we can make any money from it. Friday 22nd of April was a very bad day in…
Gold is one of the most famous commodities in the world and is a great diversifier for those trading mainly stocks. However, its price has gone nowhere in the past decade, so we decided to test some strategies and try…
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…
Triple exponential moving average strategy One of the not-so-common moving average indicators used by traders is the triple exponential moving average (TEMA). It is an important trend indicator used by traders to identify trends more closely than a traditional moving…
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,…
One of the best edges in the stock market is the overnight edge – the price action from the close until tomorrow’s morning (or close). Is it still working? Can a trend filter improve performance? Empirical evidence – the overnight…
Investing in international stocks can be a rewarding venture, offering diversification and access to global opportunities. However, the decision to buy stocks when they are at all-time highs can be met with skepticism. But a question arises: Is it profitable…
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…
Volume-weighted average price strategy backtest Several indicators are used for technical analysis; some of these indicators combine different market data to tell a better story about what the market is doing. The volume-weighted average price (VWAP), which combines both volume…
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…
It’s possible to make Friday Jobs Report trading strategies. One of the most important macro numbers on this planet is the monthly US job report. As a bonus, at the end of this article, we provide you with the code…
Crafting a strategy that adapts to changing conditions is crucial for success. One such strategy gaining attention is the ETF sector rotation trading strategy. In this case, we are going to be focusing on the Consumer Staples and Consumer Discretionary…
This Big Down Day Trading Strategy, centered around the SPY ETF, focuses on identifying significant downward movements and capitalizing on them. By analyzing simple variables like the average difference between daily highs and lows over a specific period, we unveil…
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…
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…
Mean reversion has worked very well on most Western stock indices for about four decades since the advent of futures trading. It has worked even better during the bull market after the financial crisis in 2008/09. Perhaps counterintuitive, long strategies…
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…
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…
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…
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…
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 channel breakout trading strategy is one of many ways to trade breakouts. Breakouts are a popular trading strategy. As the name suggests, this method involves identifying and capitalizing on significant price movements as an asset breaks free from its typical…
Market breadth indicators provide different information about the stock market in a way that other market indicators do not. But what is the market breadth? Market breadth indicates the total number of stocks that are rising in price relative to…
The financial markets may seem to move randomly, but they actually move in repeating patterns and trends. One indicator traders use to take advantage of the patterns is the fractal indicator. What is it? Fractal Indicator Trading Strategy is the…
Burton Gordon Malkiel in his famous book — A Random Walk Down Wall Street — popularized the random walk model of the financial markets. According to him, the market moves randomly and its direction cannot be predicted with technical or…
Stock and sector rotation is when you switch between different asset classes or stocks. In this case, between different asset classes. We did a backtest involving SPY, TLT, and LQD. It’s a strategy backtested by many and in different ways,…
Introduction: Understanding Dumb Money in Trading The term “dumb money” in Dumb Money trading strategy refers to a group of investors who are considered to be less sophisticated or experienced than other participants in the market. These investors may make…
ETF trading strategies can be a very nice addition to your trading strategy arsenal. This guide breaks down key ETF tactics including trend following, mean reversion, and more, to give you a better understanding of how you can trade ETFs….
You must have heard about fundamental analysis whether you trade stocks, futures, or forex. Many market pros, such as portfolio managers, hedge fund investors, and investment bank professionals, use fundamental analysis. But what the fundamental analysis strategy actually entails? A…
Most price charts are time-based in the sense that a price bar represents price movement over a specified period of time. However, there are other chart types that are not based on time but, rather, on a specified price movement…
This article presents a stock trading system that only trades stocks. It has beaten buy&hold and (10.4% vs 7.5%) with a much lower drawdown. This is the equity curve and the complete trading rules are presented further down in the…
Interested in spread trading? It’s a strategy where traders open opposing positions in related markets, aiming at profits from the price gap. Our article takes you through 12 top strategies for spread trading, covering the essentials and diving into advanced…
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…
The futures market is exciting because of its good liquidity, and unlike equity day trading, there is no reasonable entry barrier, as you can start with as low as $500. But what exactly are futures? And can you find profitable…
There are many kinds of funds, ranging from illiquid private equity funds to highly liquid mutual funds and ETFs that are available to the public. Hedge funds occupy the sweet middle, but what are hedge fund trading strategies? Hedge fund…
