Here is a simple mean reversion twist in SPY that holds the S&P 500 just one day (from the close to the next day’s open). It’s an overnight trading strategy, the lowest hanging fruit in the stock market. The 3-day down overnight trading strategy In plain English the strategy reads like this: SPY must be…
What happens after an extraordinary big fall in SPY? Let’s find out and test by using some simple variables. To measure a big fall we use the average difference between the high and the low over the last 25 days. Calculate the average H-L range over the last 25 days (in percent). If the ETF…
The S&P 500 has shown strong mean reversion tendencies for many decades. One reason for this is the tailwind in the form of 0.04% average return from the close until the next day open, so-called night trading, the lowest hang fruit in the tock market. This article looks at the performance of the overnight session…
Mondays have turned out to be reversal days, at least on the long side after a fall on Mondays or the days leading up to Monday. Letæs test a reversal trading strategy: In this article, we test a Monday overnight reversal trading strategy in the S&P 500: we go short on a Monday or Tuesday…
This article presents an overnight trading strategy in the S&P 500. Overnight means entering at the close and exit at tomorrow’s open. We exit at the next open no matter the price movement during the night session. We have previously written about other overnight trading strategies plus described the night trading session: Night trading strategies…
Jay Kaeppel wrote an interesting post about gold stocks: The greatest gold stock system you’ll probably never use. I have a twist to this system which I’ve been trading for some weeks. Since Kaeppel has published it I might as well publish it myself. And it’s so simple and the results are so astonishing I…
The overnight edge in the stock market is well documented: By using the tailwind from the close until the next open, you can develop some good short-term trading strategies. In this article, I present 4 overnight trading strategies in the S&P 500. The strategies buy at the close and sell the next day’s open. Because…