On this page, we have compiled all the free trading strategies we have published since our start in 2012 (plus trading relevant articles). The page contains 70+ free strategies plus articles about indicators and trading strategy-specific articles.
If you don’t want to browse through all the articles, we have compiled the code for all articles that contain testable strategies or hypotheses. You’ll get code to quantify and description in “plain English”.
Before you look at our free trading strategies below, you might want to read our articles about what quantified strategies are about:
- Is it possible to find inefficiencies in the markets? (Examples, strategies, edges)
- Quantitative swing trading course for Amibroker and Tradestation
- Which time frame is best in trading? What time frame should you trade?
- Is this the Holy Grail of trading? (The secret of Holy Grail trading strategies)
- What is a good trading strategy? (What to look for in strategies)
- Why trading strategies don’t work in live trading (Why they stop working)
- What are quantified strategies? (Including a trading strategy)
- How to become a successful quant trader (Can you be a quant?)
- Why trading strategies are not working (How do you know a trading strategy stops working?)
- How to avoid or minimize strategies stop working (Be prepared when your strategy stops working)
- How and when should you exit a trade? 5 methods to exit your trading strategies (guide to exits)
- How to find trading edges in the markets (What is a trading edge – examples and strategies)
- Why build a portfolio of quantified strategies (including two strategies)
Types of trading strategies:
- 3 free mean reversion trading strategies (backtested buy and sell signals)
- 10 free swing strategies that work (backtested buy and sell signals)
- Gap trading strategies (How to trade gaps with backtested examples)
- Trend following strategies and systems explained (including strategies)
- How to create a mean reversion trading strategy (pros and cons of mean reversion strategies)
- Does quant trading work? How can you make quant trading work for you? (Is being a quant worth it?)
- Breakout trading strategies (including examples)
- Is trend following dead (again)? Or just the normal out-of-favor cycle?
Indicators and how they work (including trading strategies):
- The 200-day moving average: How it works, why it works, and why it doesn’t work
- Keltner Bands strategies (Keltner Channels strategies)
- Average True Range trading strategy (ATR indicator – how to use it)
- What is the VIX and how does it work? (VIX trading strategies)
- The stochastic indicator – does it work? (Stochastic trading strategies)
- Williams %R explained – does it work? (Williams %R strategies)
- WilliamsVixFix explained – does it work? (Including trading strategies)
- Heikin Ashi explained (is it useful?)
- Do candlesticks work? A quantitative test of 23 candlestick formations
- How many candlestick patterns are there?
- Does the MACD indicator work? (Including strategies)
- Are the Bollinger Bands profitable? (Including strategies)
- Are moving averages good or useless? (Quantified strategies)
- Ways to use ADX (Strategies – does it work)?
- How the RSI indicator works (RSI trading strategies)
- The internal bar strength (IBS) indicator
- The Elder Ray Indicator (with strategies): Does it work?
- The Chaikin Oscillator – does it work? (Chaikin Trading Strategies)
- Linear vs. logarithmic charts and scale – what is log scale chart (what is the difference? What is best?)
If you like our free trading strategies on this page, you might be interested in our monthly subscription service where we provide trading edges/strategies. We save our best strategies for our paying subscribers.
Each month we publish a new “edge”/strategy – a 100% quantifiable trading idea that includes buy and sell signals in “plain” English plus code for Amibroker and Tradestation/Easy language.
S&P 500 trading systems (SPY free trading strategies):
- The Turnaround Tuesday trading strategy
- Volatility trading strategy the S&P 500 (both long and short profitable)
- Conclusions about trend-following the S&P 500
- A simple trend-following system/strategy on the S&P 500 (By Meb Faber and Paul Tudor Jones)
- S&P 500 mean reversion using IBS and RSI (Classical mean reversion strategy S&P 500)
- Buy when the S&P 500 makes new intraday high? (Intraday High Breakout Trading Strategy)
- RSI(2) on SPY (RSI trading strategy S&P 500)
- Monday Reversal Trading Strategy In The S&P 500 And Nasdaq (Big Move On Mondays – Trend Reversal)
- End of month trading strategy in the S&P 500 – update
- 3 day low trading strategy in ETFs
- What happens after an “extraordinary” big fall in the S&P 500?
- Does volume really matter in the S&P 500? (A volume-based trading strategy in the S&P 500)
- When both Thursday and Friday are down in SPY (S&P 500 reversal trading strategy)
- A failed bounce is normally followed by rising prices (The failed bounce trading strategy)
- The 2x Fall trading strategy in the S&P 500 (mean reversion trading strategy)
- The high and low divergence day trading strategy
- The bottom of the range trading strategy
- Two big down days trading strategy
- The momentum day trading strategy in the S&P 500 (SPY) during the last hour
- The 5-day low and low of the range trading strategy (S&P 500 mean reversion)
- Opening gaps in SPY/S&P 500, part 3, the anatomy of fading gaps
- When SPY closes in the bottom of today’s range
- Opening gaps in SPY/S&P 500, part 2
- Opening gaps in SPY/S&P 500, part 1
- At what time of the day does SPY/S&P 500set high and low?
- Using the VIX to trade S&P 500
- The trend is not your friend in the S&P 500 (and other indices)
- The Tuesday reversal trading strategy (S&P 500 – SPY)
- Daily seasonalities in the S&P 500
- Intraday high and low in the S&P 500 by weekday
- Every open down trading strategy (Buy every open down?)
- MACD-histogram trading strategy
- Four down days in a row trading strategy
- S&P 500 weekly gains and losses distribution (strong mean reversion)
- Some performance facts about the S&P 500
Overnight trading strategies in stocks:
- Night strategies trading (overnight edges/strategies)
- An overnight short trading strategy in the S&P 500
- 4 Overnight Trading Strategies In The S&P 500 (Strategies From Close To The Next Open)
- Overnight trading strategy in the S&P 500
- Monday Overnight Reversal In The S&P 500 (Short strategy)
- The 5-day low overnight trading strategy (S&P 500 overnight)
- The 3-day down overnight trading strategy in the S&P 500 (3 down days – and gap up?)
Nasdaq trading systems (QQQ free trading strategies):
- RSI(2) on QQQ (RSI mean reversion trading strategy Nasdaq)
- Monday/Tuesday trade in Nasdaq
- Nasdaq (QQQ) mean reversion
- Monday/Tuesday trade in Nasdaq
Treasuries/bonds trading systems (TLT free trading strategies):
- Calendar effects in long-term Treasuries (TLT seasonal trading strategies)
- Trend following strategies Treasuries
- Some monthly seasonalities in US Treasury bills
- Monthly seasonalities in long-term Treasuries
- Daily effects in long-term Treasuries (Day of the week trading strategy in TLT)
Consumer staples trading systems (XLP free trading strategies):
- XLP trading strategies (Why trade XLP)
- Internal bar strength trading strategy in consumer staples
- Trade the boring consumer stocks when they open down and yesterday was a down day – a day trading strategy
- When XLP diverges from recent high and low: A mean-reversion trading strategy
Seasonality strategies in stocks (seasonalities, anomalies, abnormalities, and effects):
- Why use seasonalities in trading (Seasonal examples and strategies)
- Even Vs. odd days trading strategy (S&P 500)
- Last trading day of the month trading strategy (the last day of the month effect/seasonality)
- The options expiration week effect (options week anomaly and seasonality trading strategy)
- Trading the holiday effect in stock markets (anomaly and seasonality)
- The turn of the month trading strategy (end of month effect)
- The January effect strategy that works
- The January effect in the S&P 500
- Sector ETF performance per quarter
- Country ETF performance by quarter
- First trading day of the month trading strategy (first day of the month effect)
- The end of the year rally in stocks (S&P 500 Santa Claus rally/effect)
- What is the worst month of the year for stocks? It’s September
- Retail stock market seasonality trading strategy
- The Russell 2000 rebalancing strategy (end of June Rally/Effect)
- Sell in May and go away – OBX (Oslo Stock Exchange)
- The End of month rally/effect in stocks (S&P 500 seasonality)
- December seasonality in OBX (Oslo Stock Exchange)
- Day of week seasonality in the S&P 500
- Sell in May and go away – myth or fact – the S&P 500 (trading seasonality)
- The first day of month seasonality in the S&P 500 (Trading the first day of the month)
- The average gain per trading day and day of the week since 1970 in the S&P 500
Rotation strategies (free momentum strategies):
- S&P 500 and gold miners rotation strategy/system
- S&P 500 and gold rotation strategy (SPY and GLD rotation)
- Market neutral momentum in SPY and EEM
- Monthly momentum in SPY and EEM
- Monthly momentum in SPY and TLT (rotation strategy)
- A monthly momentum strategy in ETFs (sector rotation in EEM, SPY, TLT)
- A simple pair trading strategy in liquid ETFs (pair trade ETFs)
Free trading strategies for one or more instruments/assets:
- A pair trade in SPY and TLT (pairs trading strategies)
- Trend following and momentum strategies on bitcoin (crypto) – capturing the trend (free bitcoin trading strategies)
- The anatomy of a bear market: 2000 -2003 (Nasdaq and the S&P 500)
- Stock and sector rotation – what is it – why do it
- How does pairs trading work? (Market-neutral strategies)
- Larry Connors’ Double Seven strategy (Double 7 trading strategy)
- Larry Connors’ multiple days up and multiple days down strategy
- Larry Connors’ %b strategy (Bollinger Bands)
- Larry Connors’ R3 strategy
- Larry Connors’ RSI 25 & RSI 75 strategy
- Larry Connors’ 3-day high/low strategy
Day trading: strategies, systems, and relevant articles:
- A new potential day trading strategy, part2
- A new potential day trading strategy
- SPY sets low or high in the last hour – a day trading strategy
- How to succeed in day trading
- How I made money day trading (How day traders make money – tips, tricks, and hacks)
- Why day traders fail (avoid the pitfalls of day trading)
- Is day trading a good idea? Is it worth it?
- Moving Abroad: Tax Implications for Day Traders
- The Best Day Trading Stocks Are The Most Boring Stocks
- Pros and Cons with Day Trading
- Day Trading SPY: Returns In The First Hour, Middle of The Day, and The Last Hour
- Confessions Of A Day Trader
- Is It Possible To Make Money Day Trading? My numbers July 2012 – July 2013
- Is It Possible to Make Money Day Trading? Can you make money day trading? (My numbers 2002-2012 – real money)
- Is It Possible To Make Money Day Trading? Part 2: Automated trading
- Is It Possible To Make Money Day Trading? Part 3: Tuco Trading
- The Cost of Second-Guessing Strategies (Why you need a written trading plan and log)
- Why I Day Trade US Stocks
- Some Random Facts About My Day trading So Far In 2013
Gold trading systems (GLD free trading strategies):
- Gold weekend trading strategy (GLD swing trading)
- Trend-following system/strategy in gold (12-month moving average)
- The greatest gold stock system you should trade
- When gold gaps up or down
Miscellaneous trading strategies:
- How to trade and invest in oil stocks (trading strategy and seasonality)
- Why scalping is a waste of time (do this instead)
- Why you shouldn’t trade penny stocks (why avoid them)
- Shorting oil when the dollar rises
- The Friday Seasonality in USO (oil)
- What is more important? Entry or exit?
- Pivot points – are they profitable?
- Candlestick pattern – doji
- Gap down strategy in stocks – going long
- Can I swing trade futures? (How much do I need?)
- In the long term it pays to be a contrarian trader and investor
- The Importance of Trading Records
———-Trading related articles———-
Quant trading, algorithmic trading, mechanical trading, and quantified trading strategies:
- 26 trading lessons I have learned after 20 years as full-time trader (learning how to trade)
- How Jim Simons’ trading strategies made 66% a year (The Medallion Fund)
- 6 reasons why backtesting works
- Can you get rich by quant trading? (Tips and tricks for quant traders)
- 8 pros and cons of quant trading (Quant trading strategies)
- Advantages With Quantified And Mechanical Trading Strategies (The Parts Of A Mechanical Trading Strategy)
- Proprietary trading – pros and cons (a personal experience)
- How can a beginner start trading? How to get started in trading
- Survivorship bias in backtesting, trading, and investing (How To Avoid And Minimize It – Examples)
- Trading or investing – what is best? (What’s the difference?)
- The Sharpe Ratio Explained (What is a good Sharpe Ratio? Examples)
- The profit factor explained (what is a good profit factor in trading? Examples of profit factors)
- Disadvantages of backtesting (Why backtesting doesn’t work)
- How to fail as a trader: 11 skills of the unsuccessful (inverse thinking)
- Out-of-sample trading tests explained (what is out-of-sample backtesting?)
- Thoughts On Amibroker (review, summary, pros, and cons)
- The Importance of Backtesting
- How to generate trading ideas (What are trading ideas?)
- Common mistakes in quantified trading
- Is It Possible To Make Money Swingtrading? My numbers 1st half 2013
- Data Mining And Boredom (The same strategy can’t be used on all stocks)
- The Importance of Good Data Sets When Backtesting (Garbage In Equals Garbage Out)
Money, risk, and trade management in trading strategies:
- Win ratio in trading – what it is and why it is important
- Stop-loss – pros and cons (good or bad? Alternatives to stop-loss)
- How Important Are The Best Days Compared To Total Profits?
- Why is max drawdown important in trading? What is a good drawdown percentage?
- How to deal with drawdowns (How to prepare and minimize drawdowns)
- What are negatively skewed trading strategies? (Example of negatively skewed distribution – fat tail)
- What does correlation mean in trading? (Trading strategies and correlations)
- Should You Use Profit Target In Your Trading Strategy? (What Is A Profit Target In Trading?)
- How to enter and exit positions at the close in Amibroker and Tradestation (using daily bars)
- Why trading needs to be simple and easy (Simple beats complex in trading)
- 2 reasons why less is more in trading (why keep trading and investing simple)
- I Never Take My Losses Quickly (why use time stops)
- Why Experience Matters
- A Different Approach To Money Management
- Some random thoughts about risk
- Why consistency in trading is important
- How Much Pain Can You Take? Risk, Hindsight, Consistency, And Paper Trading
- Stop-loss doesn’t work (Mean-reversion and stops)
- Stops hurt! (What Larry Connors and Curtis Faith think about stop-losses)
- Is Trading A Game of Skill Or Chance?
- The value of using targets
- Is focusing on psychology overrated in trading? Do this instead
- Habits of wealthy and successful traders
- How to overcome trading biases (tips, tricks, and hacks)
- The most common trading biases (how to deal with them)
- Why the mental and behavioral aspects are equally important as the trading strategy
- Can you become a quant? A personality test (psychology and quants)
- The correct mindset for trading (a traders mindset)
- If you can´t suffer the pain, don´t play the game
- What is the best personality type for trading? (Who succeeds as traders – introverts or extroverts)
- How to gain a trading edge by knowing yourself
- Be aware your ego, be humble and open-minded in trading (case-study: Okumus Capital)
- Why intelligence and overconfidence in trading is bad
- Is fear good or bad for a trader? (How to overcome fear in trading)
- Don´t waste your youth dreaming about getting rich trading
- Things to consider before trading full time (don’t quit your job)
- Why keep trading as simple as possible
Execution, commissions, slippage, and rebate in trading strategies:
- How bigger bid-ask spreads influenced my trading profits negatively
- What Is More Important? Entry or Exit?
- What Is Slippage In Trading? (The Hidden Cost)
- An Example of Rebate
- Commission Costs
- How I Allocate My Capital And How Commissions Grab My Gross Profits
- How To Minimize Slippage and Commissions (MOC and OPG orders)
- How To Receive Commissions – Rebate Trading
Trading literature with trading strategies:
- Ed Seykota – wisdom, quotes, and strategies/systems (trend follower wizard)
- My books
- Edward Thorp: Beating the odds – the first quant
- How Jim Simons’ trading strategies Made 66% A Year (The Medallion Fund)
- Being Slightly Bonkers Can Serve You Well In Trading (Rory Sutherland Summary)
- The Way of The Turtle – Curtis Faith
- The Education of a Speculator – Victor Niederhoffer (review, summary, and lessons)
- Evidence Based Technical Analysis – David Aronson
- Boardgames And Trading
- My 6 Best Trading Books
- Poker (Trading), Sex And Dying by Juel Anderson And David Caplan
- When Genius Failed – Roger Lowenstein (The collapse of LTCM)
Brokers and legislation:
- How to choose the best stock broker for you (what to look for when choosing a broker)
- ETFs vs. futures: What should you trade – what’s the difference between? (EU vs. US ETFs)
- Is It Still Possible To Trade US ETFs For EU Retail Residents?
- Is Interactive Brokers safe? Brexit mess
- The Hidden Cost Of Strict KYC and AML In The Banking Sector
- Implications of A Financial Transactions Tax (why it’s a bad idea)
Finale: Some advice before you embark on your trading career:
If you have clicked on one or several of the free trading strategies above, you might wonder what is the best way to approach trading. We have tried to answer that in many other articles, but below we give a very brief explanation of what should be your main considerations before you start trading:
Are you a trader or an investor?
First, you need to have a thorough understanding of what kind of investor you are. It might seem obvious, but many derail already before they start.
Sit down and think about what your aims and goals are. Are you a trader or an investor? Do you think you have the mindset and capabilities to deal with frequent profits and losses?
The alternative to trading is to invest in stocks and mutual funds for the long-term:
Position trading/buy and hold
By position trading we mean holding positions for a long time, close to or equal to “buy and hold”.
Should you trade at all? Trading is scalable, ie. you can make a lot of money in a relatively short period of time, but the fail ratio is much higher compared to buy and hold.
- Trading or investing – what is best?
- Compounding – the magic of a long-term mindset and delayed gratification
If you invest passively in a mutual fund you participate in the earnings and productivity growth in society and you are most likely well protected against inflation.
We recommend spending some time pondering where you should put your money.
What is a trading strategy?
A clearly defined trading strategy needs at least four elements:
- It needs to have defined/quantified buy/short criteria. That is, you need to know exactly when to buy. “Buy when touching resistance” is not a criterion – it’s vague and not clearly defined. You should not use anecdotal evidence in your decision-making!
- If you get a buy signal, how do you execute the buy/short order? Do you put in a limit order or do you buy at the market? In the strategies above, we mainly use at the close orders. Obviously, we only know the close price in hindsight. However, we start sending orders ten seconds before the close, and that works really well and gets very close to the results in our backtests.
- If you are in a position, you need to know when to sell/cover. Just like the buy criterion, this needs to be quantified to avoid second-guessing.
- The sell/short order should be executed at prices that are realistic compared to your backtests. Slippage and commissions are a big cost for a trader, and you need to minimize costs and make it as similar as possible to the backtest. We have been using at the close orders for years, just like when we buy and enter positions, and it works well for us.
Types of trading strategies: What kind of trader should you be?
If you start trading, you need to make plans and strategies. This takes time, but hopefully, this is time well spent and at the same time enjoyable.
If you don’t have a particular interest in trading, you should invest for the long-term and forget about trading. A great interest in trading is a prerequisite for success!
Furthermore, your approach should be agnostic. First off, what kind of instruments and asset classes should you trade? Don’t limit yourself by focusing on a certain time frame or asset class.
There are many types of strategies to choose from, but mainly we can argue they fall in two groups: day trading and swing trading.
Unfortunately, many want to be day traders in the hope they can make money faster. The reality is that most of them get poor pretty fast. It’s a fast way of departing your money if you don’t know what you’re doing.
Another downside with day trading is that you don’t benefit from the long-term tailwind in the stock market, as you do in swing trading:
Swing trading (end-of-day trading)
We prefer end-of-day trading where we enter at the close (but sometimes exit at the open). This is the same as swing trading.
Many argue they will day trade to avoid the overnight “risk” in the stock market. But the long-term trend suggests that you get well awarded for taking this “risk”: all the gains since 1993 have come from the close until the next day’s open. There has been no money to be made intraday from the open to the close.
The overnight “risk” is a nice tailwind you can exploit!
The tailwind is particularly strong in stocks, and to some extent in gold. In most other asset classes, you don’t have this edge.
Other trading strategies
Among prop traders long/short and pairs trading are popular. These are market-neutral strategies because you hold an equal amount of capital both long and short that should cancel each other out in case of adverse movements.
The idea behind pairs trading strategies is to trade on the value of the spread. For example, this could be shorting the strongest and buying the weakest on the assumption they will converge.
The downside of trading
If you buy a basket of mutual funds there is no much you need to do. Just buy the funds and forget about it. Get on with your life and save regularly and don’t interfere in your dollar-cost averaging. If history is any guide, you will be well rewarded as long as you are patient and let the capital compound.
With trading, you need to do a lot of work and research. It requires time to develop strategies, and when you are done developing you need to do the actual trading. It’s essential you like this process and find it enjoyable. If not, you will not make it as a trader.
However, if you use automated trading software you can “outsource” the trading to your computer. This gives you leverage to trade an “unlimited” number of strategies.
Which time frame is best for trading?
One of the most important things in trading is to have a portfolio of diversified strategies that correlate as little as possible. One way to do this is to trade several different time frames.
We believe we have given you a pretty wide variety in time frames in the systems and strategies we have presented above: from day trading to long-term position trading in the S&P 500.
However, most of the strategies are swing trades. Scalping and day trading is very difficult and only a few traders manage being profitable year in and year out. The longer the time frame, the more you utilize the long-term tailwind mentioned above (at least in the stock markets).
Which market is best for trading?
Because of inflation and earnings growth, a diversified basket of stocks, like for example owning the S&P 500, has proven to beat inflation in the long run. Just by owning stocks overnight, you manage a 0.04% return from the close until the next day’s open.
This is an edge, let’s call it tailwind, that you basically only get in the stock market. Very few other asset classes offer the same tailwind, perhaps gold being an exception.
Thus, we believe you stand better chances in stocks and stock indexes.
Moreover, our research stock trading strategies are less prone to “blow off”, like for example happens frequently in the commodities markets. Likewise, the forex markets are very difficult to trade. If you manage to find commodity and forex trading strategies that last year in and year out – congratulations!
We recommend starting with stocks. Not only do you have a tailwind, but you can also choose among thousand of stocks in different sectors. Many of those have little competition from other traders. Compare this to forex trading strategies where you are competing against millions of traders just in the USD/EUR spread!
Swing trading strategy tips: What are you looking for in a strategy?
You want to have consistent profits, more like an income, but that is very tough to achieve. Some kind of lump-sum and erratic profits are inevitable. Most likely just a few days per month will generate most of the profits. The rest of the time you are scraping by and looking to avoid losses and disasters.
Trading is much like a slow grind where you have to show up day in and day out for years with some occasional big wins.
That said, you want a steady rising equity curve from the left to the right. You want a profit factor that is somewhere between 1.75 and 3. Likewise, you can have a look at the Sharpe Ratio of your strategy as well.
Because of the behavioral mistakes you are most likely to commit, most traders should make strategies that give the smoothest returns you can get.
Trade small size – be careful
Trading requires experience – lots of it. In order to survive, always make sure you are trading smaller position sizes than you would like.
Likewise, don’t put all your eggs in one basket. Spread your time frames, asset classes, and strategies.
Why trade small?
You want to trade small because you want to make sure you can survive adverse movements against your position. Sooner or later you’ll experience days where all or most of your positions go against you.
Put aside money for a rainy day
Likewise, don’t put all your money in your trading account. We recommend setting aside money for long-term appreciation, preferably in mutual funds. Don’t try to be smart, make your investments simple.
Be careful with leverage:
It’s easy to get fooled by a backtest – it all looks so simple and easy in hindsight. Because of this, many use too much leverage by being greedy.
Leverage can put you out of business. Make sure you always think about how much you can lose, not what you can make. A 50% drop requires a 100% rise to get back to break-even.
Make sure you have a trading plan
This website is all about quantified trading strategies and systems. We believe 100% quantified rules are what fits most traders.
The reason for this is simple: Although nothing is certain about the future, you at least have an opinion if your strategy performed well in the past. Additionally, it makes you disciplined and less prone to knee-jerk trades out of the blue.
Besides, by automating all your trading you theoretically can trade an almost unlimited amount of trading systems. You focus on developing strategies, and you let the computer do the rest.
Avoid obvious mistakes
Profits tend to take care of themselves as long as you avoid the biggest blunders. In tennis, this is called unforced errors. In professional tennis, most of the matches are won by the player who makes the least amount of unforced errors!
Make sure you understand yourself
It might sound like a cliche, but you need to understand yourself and potential behavior mistakes you are prone to make. Even very profitable strategies won’t make you money if you buy and sell at the wrong time.
This page which contains our free trading strategies might give you input on how to start trading. Trading is not easy, and certainly much more demanding than long-term investing.
While trading offers scalability and huge profit potential, consider the time spent and risk of ruin. If you don’t know what you’re doing, you might lose your capital quickly.
Disclaimer: We are not financial advisors. Please do your own due diligence and investment research or consult a financial professional. All articles are our opinions – they are not suggestions to buy or sell any securities.