TaylorTree

Thursday, January 27, 2005

Fed Chair History

Daytraders out there need to check out the action in EAT. The market maker for that stock is making some serious coin.

The BreakUp system really missed out on the ACV trade. Just one more day would have been really nice. The ACV trade was closed at the open today and then proceeded to surge 5% beyond that opening price.

Need a little help from my readers. I'm doing some research on the history of Federal Reserve Chairmen. Anyone know the starting month for Benjamin Strong's tenure as Fed Chair?

Also, what's the deal with Ronald Ransom? I believe he died while Fed Chair and then McCabe was appointed. But, don't know the actual tenure timeline or starting month. Review the list below and let me know of any errors.

Federal Reserve Chairman in History
Benjamin Strong (starting month: ?; served: 1914 - 1928)
Marriner Eccles (starting month: February; 1936 - 1948)
Ronald Ransom (starting month: ?; served: ?)
Thomas McCabe (starting month: April; served: 1948 - 1951)
William McChesney Martin (starting month: April; served: 1951 - 1970)
Arthur Burns (starting month: February; served: 1970 - 1978)
G. William Miller (starting month: March; served: 1978 - 1979)
Paul Volcker (starting month: August; served: 1979 - 1987)
Alan Greenspan (starting month: August; served: 1987-current)

Thanks!

Daily Systems

New System Triggers

Close QQQQ (ATRBreakBB) long position at Friday's market open.

Recently Closed Trades

Closed QQQQ (MidWeekDrops) long position with a -0.62% loss.
Closed ACV (BreakUp) long position with a +3.96% profit.
Closed EAT (BreakUp) long position with a +2.96% profit.

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
QQQQ	ATRBreakBB	1/5/2005	open	-4.08%
MGF	BreakUp	1/19/2005	open	+0.60%
FO	Breakup	1/24/2005	open	+2.83%
			Total	-0.65%

Please read the disclaimer on the website. This is not a recommendation to buy, sell, or trade securities. Just a journal of my travels through Wall Street. I can buy, sell, or hold any positions mentioned on this website at anytime. So, be warned.

Wednesday, January 26, 2005

John Henry and Airbrushing Models

Very interesting Q & A with John Henry. Read here.

I admire how John has full confidence in his systems...especially in the drawdowns. I'm sure the biggest key to his performance is not deleveraging during heavy drawdowns. By staying fully leveraged he is able to snap back to prior highs. Of course, in the wrong hands this could be another Long Term Capital. So, not only confidence in your system is key...but your system's validity is an even bigger key.

Also interesting how he chooses to deleverage due to profit. And how they will look at various charts priced in different currencies.

That brings up a long-term gripe I have about some forms of technical analysis. I used to eyeball charts...up to 1500 a night. Looking for patterns that matched what I considered to be "winning charts".

The problem with this approach is that many factors change on a stock chart when a stock begins advancing. Splits, dividends, volatility, etc. You look back at a chart and might see a nice tight range then a breakout that leads to a 100% or more movement in price. You get that "aha" moment that you need to look for nice tight ranges and buy the breakouts.

Problem with this approach, is often times those "tight ranges" are only created after a 40% to 50% upward move in the stock.

Split-adjusted stocks are even more fun. They make many stocks look as if they rose from mere pennies when in fact they got their start at a much higher price. Fools several beginning investors into thinking they need to look at penny stocks in order to find the next Starbucks.

Okay, enough griping before I piss off anymore die hard chart readers.

Seriously, I still review charts every night. Always will. There's no better way to tell what's going on with a stock for me. But, realize you're often times looking at a Maxim Magazine cover spread. Airbrush and all. Looks can be deceiving.

Later trades.

Daily Systems

New System Triggers

Close QQQQ (MidWeekDrops) long position at Thursday's market open.
Close ACV (BreakUp) long position at Thursday's market open.
Close EAT (BreakUp) long position at Thursday's market open.

Recently Closed Trades

none

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
QQQQ	ATRBreakBB	1/5/2005	open	-3.96%
ACV	BreakUp	1/7/2005	open	+1.01%
MGF	BreakUp	1/19/2005	open	+0.60%
QQQQ	MidWeekDrops	1/24/2005	open	+1.03%
FO	Breakup	1/24/2005	open	+2.70%
EAT	Breakup	1/25/2005	open	+4.33%**
			Total	+5.71%

Note: EAT opened late on the NYSE exchange and its very possible the actual opening print was much higher than the $36.52 quoted in the various data providers.

Please read the disclaimer on the website. This is not a recommendation to buy, sell, or trade securities. Just a journal of my travels through Wall Street. I can buy, sell, or hold any positions mentioned on this website at anytime. So, be warned.

Tuesday, January 25, 2005

Bad Fill

Frustrated with my broker today. I decided to take the EAT trade this morning and received a horrible fill at the opening print. Just horrible.

If anyone has a good broker to recommend please pass them my way. To be honest, I don't really need much in the way of online brokerage services. I would even prefer to just call or email my order in. Pretty much the only type of orders I place are market orders at the open. Anyway, if you have a good broker...let me know either via comments or email at mike@taylortree.com. I'd appreciate your input.

Daily Systems

New System Triggers

none

Recently Closed Trades

none

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
QQQQ	ATRBreakBB	1/5/2005	open	-5.09%
ACV	BreakUp	1/7/2005	open	+0.57%
MGF	BreakUp	1/19/2005	open	+0.30%
QQQQ	MidWeekDrops	1/24/2005	open	-0.16%
FO	Breakup	1/24/2005	open	+2.94%
EAT	Breakup	1/25/2005	open	+1.92%**
			Total	+0.48%

Monday, January 24, 2005

Jim Rogers Interview

Check out RealWorldTrading.com's interview with Jim Rogers. Read here. And during my vist to the site I found a nice interview of Charles Cottle. Read here.

Working hard on trading systems development. My eyes are bloodshot, my brain is fried, and I need rest. But, can't stop. My system development juices are flowing again. Yeah!

I will most likely remove the trading system signals for the QQQQ systems. I found some interesting dynamics between the various index systems and I'm now certain these need to be used as an indicator instead of individual systems. So, I'll close the posting of QQQQ systems after the close of the MidWeeksDrops system. Hopefully, in the next few weeks I'll be able to post the indicator chart. That is if I'm still alive. :)

Daily Systems

New System Triggers

Enter EAT (BreakUp) long position at Tuesday's market open. Note: earnings will be announced Tuesday around 9:00am. This is an event that isn't backtested very well in the BreakUp System. So, I'm not sure I will take this trade. Might be better to watch and learn how the system handles this type of event.

Recently Closed Trades

Closed CB (BreakUp) long position with a -4.09% loss.

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
QQQQ	ATRBreakBB	1/5/2005	open	-4.21%
ACV	BreakUp	1/7/2005	open	+0.10%
MGF	BreakUp	1/19/2005	open	0.00%
QQQQ	MidWeekDrops	1/24/2005	open	-1.27%
FO	Breakup	1/24/2005	open	+0.87%
			Total	-4.51%

Weekend Update

Daily Systems

New System Triggers

Enter QQQQ (MidWeekDrops) long position at Monday's market open.
Enter FO (BreakUp) long position at Monday's market open.
Close CB (BreakUp) long position at Monday's market open.

Recently Closed Trades

None.

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
QQQQ	ATRBreakBB	1/5/2005	open	-4.21%
ACV	BreakUp	1/7/2005	open	+0.10%
CB	BreakUp	1/19/2005	open	-4.09%
MGF	Breakup	1/19/2005	open	-0.15%
			Total	-8.35%

Weekly Systems

New System Triggers

Enter DCTH (PennyLag) long position at Monday's market open.
Close EGHT (PennyLag) long position at Monday's market open.
Close ZICA (PennyLag) long position at Monday's market open.
Close QQQQ (TurtleTrader) long position at Monday's market open.

Recently Closed Trades

Closed VNWK (PennyLag) long position at +10.14% profit.

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
QQQQ	SimpleUp	1/4/2005	open	-2.37%
QQQQ	TurtleTrader	1/5/2005	open	-7.65%
AATK	PennyLag	1/5/2005	open	-19.44%
EGHT	PennyLag	1/5/2005	open	-34.20%
ZICA	PennyLag	1/6/2005	open	+29.75%
CARN	PennyLag	1/7/2005	open	-7.38%
HAUP	PennyLag	1/7/2005	open	-16.56%
DDDC	PennyLag	1/18/2005	open	-10.50%
			Total	-68.35%

Thursday, January 20, 2005

Back to the Salt Mine

Sorry for the lack in posts this week. It has been a very busy week. My mind is on other things than this blog or the current market's state. I've been trying to figure out how to code the QQQQ daily systems into an indicator.

I've made some progress the past two nights. But, still much work ahead. So, before I head back to the salt mine...wanted to wish everyone a great weekend.

Later trades.

Daily Systems

New System Triggers

None

Recently Closed Trades

Closed QQQQ (TrueRVolume) at Thursday's market open with a -2.66% loss.

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
QQQQ	ATRBreakBB	1/5/2005	open	-3.44%
ACV	BreakUp	1/7/2005	open	+1.62%
CB	BreakUp	1/19/2005	open	-3.25%
MGF	Breakup	1/19/2005	open	+0.00%
			Total	-5.07%

Wednesday, January 19, 2005

Year 2000 Behavior?

Is it just me or does the recent market behavior feel like early 2000? When companies with good earnings got slaughtered. In fact, any good news was sold and sold hard.

I guess what I'm getting at is this type of behavior feels more like a top than a bottom. So, be careful out there.

Later trades.

Daily Systems

New System Triggers

Closing the QQQQ (TrueRVolume) long system at Thursday's market open.

Recently Closed Trades

Closed QQQQ (VolSurgeDown) at Wednesday's market open with a +1.23% profit.
Closed QQQQ (BBLower) at Wednesday's market open with a +0.18% profit.
Closed WAG (Breakup) at Wednesday's market open with a +6.77% profit.

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
QQQQ	ATRBreakBB	1/5/2005	open	-1.55%
QQQQ	TrueRVolume	1/5/2005	open	-1.55%
ACV	BreakUp	1/7/2005	open	+0.61%
CB	BreakUp	1/19/2005	open	-1.16%
MGF	Breakup	1/19/2005	open	+0.15%
			Total	-3.50%

Tuesday, January 18, 2005

Busy as a Bee

This promises to be a busy week. Sorry for any lack in posting.

Received a new system trigger for the close-end fund, MGF for Wednesday's market open. This system trigger is from the BreakUp system. I don't like this trade selection. It's not what the system was created for...but these type of instruments have been included in my backtest. So, the BreakUp system can handle it...I'm just reluctant to trade it. I'll add it out there and most likely just track it not trade. I'll think about it more over a good night's rest.

Later Trades.

Daily Systems

New System Triggers

Closing the QQQQ (VolSurgeDown) long system at Wednesday's market open.
Closing the QQQQ (BBLower) long system at Wednesday's market open.
Closing the WAG (BreakUp) long system at Wednesday's market open.
Opening the CB (BreakUp) long system at Wednesday's market open.
Opening the MGF (BreakUp) long system at Wednesday's market open.

Recently Closed Profits

Closed the QQQQ (Tii100Low) on Tuesday's market open with a -0.88% loss.
Closed the QQQQ (Harami) on Tuesday's market open with a -1.03% loss.

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
WAG	BreakUp	1/4/2005	open	+6.96%
QQQQ	BBLower	1/5/2005	open	+0.10%
QQQQ	ATRBreakBB	1/5/2005	open	+0.10%
QQQQ	TrueRVolume	1/5/2005	open	+0.10%
ACV	Breakup	1/7/2005	open	+1.19%
QQQQ	VolSurgeDown	1/8/2005	open	+1.15%
			Total	+9.60%

*Note, my totals were not correct in previous posts on the daily system tables.

Please read the disclaimer on the website. This is not a recommendation to buy, sell, or trade securities. Just a journal of my travels through Wall Street. I can buy, sell, or hold any positions mentioned on this website at anytime. So, be warned.

Monday, January 17, 2005

3 Day Weekend Update

Stayed and played at the Kemah Boardwalk this weekend. The girls and I ate great seafood, shopped, and rode the train. It was a little cold...but still enjoyable. My daughter loved the Aquarium restaurant. Her parents did too. :)

Now, on to business. I'm thinking about changing the trading of the QQQQ systems...both the weekly and daily systems. The reason? Too much money is tied up in order to trade them. Basically, they just don't produce enough profit to warrant the tie up of capital. I have two choices: 1) Trade the underlying option contracts or 2) Convert the systems into an indicator and use to create strategies to trade stocks within the Nasdaq 100 index.

So, over the coming weeks expect changes in those systems and how they are published.

Have a great week!

Daily Systems

New System Triggers

Closing the following long systems at Tuesday's market open: QQQQ (Tii100Low) and QQQQ (Harami).
Opening the QQQQ (VolSurgeDown) long system at Tuesday's market open. I'm no longer trading the QQQQ systems but will continue to publish them until I decide upon an alternative way to trade them.

Recently Closed Profits

Closed the QQQQ (VolSurgeDown) on Friday's market open with a -1.11% loss.

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
WAG	BreakUp	1/4/2005	open	+3.17%
QQQQ	Tii100Low	1/5/2005	open	-0.65%
QQQQ	BBLower	1/5/2005	open	-0.65%
QQQQ	ATRBreakBB	1/5/2005	open	-0.65%
QQQQ	TrueRVolume	1/5/2005	open	-0.65%
QQQQ	Harami	1/6/2005	open	-0.49%
ACV	BreakUp	1/7/2005	open	-0.02%
			Total	+0.03%

Weekly Systems

New System Triggers

Closing the VNWK (PennyLag) long system at Tuesday's market open.
Opening the DDDC (PennyLag) long system at Tuesday's market open.

Current Open Systems

Symbol	System	Entry Date	Exit Date	Profit/Loss%
QQQQ	SimpleUp	1/4/2005	open	+1.26%
QQQQ	TurtleTrader	1/5/2005	open	-4.21%
AATK	PennyLag	1/5/2005	open	-17.86%
VNWK	PennyLag	1/5/2005	open	+13.04%
EGHT	PennyLag	1/5/2005	open	-23.58%
ZICA	PennyLag	1/6/2005	open	+21.28%
CARN	PennyLag	1/7/2005	open	-5.87%
HAUP	PennyLag	1/7/2005	open	-14.77%
			Total	-30.71%

Thursday, January 13, 2005

TGIF

When I run my weekly system scans this weekend...I'm afraid a few sell triggers will be issued due to disaster stops. Unless we have a good day tomorrow.

Losses hurt but are a part of business. A great take on losses is from Tom Basso's interview in The New Market Wizards book:

"Think of each trade as one of the next one thousand trades he's going to make. If you start thinking in terms of the next one thousand trades, all of a sudden you've made any single trade seem very inconsequential."

"I stopped looking at losses as problems and started viewing them as opportunities to elevate myself to the next plateau."

"I sat there for a moment and thought about all the events and actions of the previous evening and that morning. I realized that there was not a single thing I would have done differently. Despite having just lost 15 percent in our portfolios overnight, I felt phenomonally good at that point."

Market note: The heavy-weights were back at it again today. Will they be back tomorrow? Doubt it. We should see some strength. But, watch the last hour of trading to gauge how comfortable traders are with holding over the weekend.

Everyone have a great Friday and enjoy your weekend.

Daily Systems

Sell trigger issued for QQQQ (VolSurgeDown) long system at Friday's market open. The signal issuing the sell is a time stop. Most of these QQQQ systems will be hitting time stops next week.

Current Open Systems:

Symbol	System	Entry Date	Exit Date	Profit/Loss%
WAG	BreakUp	1/4/2005	open	+2.30%
QQQQ	Tii100Low	1/5/2005	open	-1.58%
QQQQ	BBLower	1/5/2005	open	-1.58%
QQQQ	ATRBreakBB	1/5/2005	open	-1.58%
QQQQ	TrueRVolume	1/5/2005	open	-1.58%
QQQQ	VolSurgeDown	1/6/2005	open	-1.42%
QQQQ	Harami	1/6/2005	open	-1.42%
ACV	BreakUp	1/7/2005	open	-0.81%
			Total	-0.94%

Wednesday, January 12, 2005

Ringing the Bell

Is that what Bill Cara said he does when he makes some coin? Well, I'm ringing the bell because yesterday's post was spot on with how the market traded today. Bill, can you hear the bell? :)

Articles for the musing:

Another great post from the Texas Hedge Report. I do not want to agree with their analogy on the Roaring Twenties and today. But, they make a good case. If you throw the Presidential cycle into the mix...their timing might be pretty accurate. The 29 crash occured 3 October's before the 1932 election. We're currently 3 January's away from the 2008 election. If the gold and silver markets are truly in secular bull markets...they're going to have to start turning around sooner rather than later.

An interesting study on buying the prior year's strongest sectors. If you would have done this from 1991 thru 2004; you'd have a compounded annual return of 18.4% versus the SP-500's 9.7%. Read here.

Interview of Jeffrey A. Hirsch from RealWorldTrading. Take it for what you will. Read here.

I have a problem with simplified logic. Maybe because that's my game. ;) Regardless, the logic this investor is using to game oil and satellite radio worries me. Read here.

Interview with Pulte Homes CEO, Richard Dugas. A completely different perspective on the rise in real estate. Can you believe they build and sale 100 homes a day? Read here.

Daily Systems

Current Open Systems:

Symbol	System	Entry Date	Exit Date	Profit/Loss%
WAG	BreakUp	1/4/2005	open	+3.89%
QQQQ	Tii100Low	1/5/2005	open	-0.26%
QQQQ	BBLower	1/5/2005	open	-0.26%
QQQQ	ATRBreakBB	1/5/2005	open	-0.26%
QQQQ	TrueRVolume	1/5/2005	open	-0.26%
QQQQ	VolSurgeDown	1/6/2005	open	-0.10%
QQQQ	Harami	1/6/2005	open	-0.10%
ACV	BreakUp	1/7/2005	open	+0.26%
			Total	+0.38%

Time for the Pop?

Are the heavy-weights through selling? Will Intel's earnings be enough to pop the market up tomorrow? Or will the heavy-weights use the strength to continue their liquidation?

All good questions. And this guy has no answers. Just a warning. Everyone is now used to strength in the morning and weakness in the afternoon. Tomorrow sure looks to start out strong. If so, you can bet your hard earned dollar that retail traders will be shorting that strength hard and fast. Might lead to a nice little squeeze in the afternoon for those traders. That is if the heavy-weights are indeed through with their selling.

A side note. Has anyone been watching SBUX? I for one have never understood this stock or the company. Now, don't get me wrong...I must have my daily cup of joe like the next fella. But, c'mon. Their prices. You gotta be crazy. The local Diamond Shamrock store has a nice little coffee shop with prices more to my liking. And if you don't like that try a Dunkin Doughnuts or the many places sprouting across the country selling premium coffee for discount prices.

Can SBUX really survive long-term? At these stock prices? The recent announcement of MCD entering the premium coffee biz makes me wonder. At least the war between these two very different companies will be fun to watch. Especially with SBUX getting into the hot food business.

And if MCD isn't enough of a worry maybe KO is. With the rumor of a new coffee-flavored coke possibly hitting the market. Read here.

Of course, you've got to add the widespread ownership of SBUX to boot. There's only one exit fellas. Single file, single file.

Note: I do not have any position in SBUX, MCD, or KO at the time of this writing.

Daily Systems

Current Open Systems:

Symbol	System	Entry Date	Exit Date	Profit/Loss%
WAG	BreakUp	1/4/2005	open	+3.27%
QQQQ	Tii100Low	1/5/2005	open	-1.09%
QQQQ	BBLower	1/5/2005	open	-1.09%
QQQQ	ATRBreakBB	1/5/2005	open	-1.09%
QQQQ	TrueRVolume	1/5/2005	open	-1.09%
QQQQ	VolSurgeDown	1/6/2005	open	-0.93%
QQQQ	Harami	1/6/2005	open	-0.93%
ACV	BreakUp	1/7/2005	open	+0.02%
			Total	-0.33%

Monday, January 10, 2005

Weak!

The market is looking weak. You feel good about the market when you wake up in the morning, the market is down, and then spends the rest of the day trending up. Day after day of this behavior and traders get bullish.

Not this market. Wake up every morning to witness the market up, sometimes nicely, then to watch it sell-off and finish the day lower. Weak!

You can almost feel the heavy-weights allowing the market to work higher in the morning and then begin their selling into the strength...working their positions off.

During these trading environments watch what is being sold. What's getting hit, experiencing a nice pop in the morning to then experience heavy selling pressure in the afternoon. These stocks can be a lot of fun once the heavy-weights work their positions off.

How did the Five Down system work out? Not good. If you would have taken the trade you would have lost -0.08%. There were 3 trades that occurred in the year 2004. Only 1 was a loser that occurred back in March. The loss was -0.82%. What's worse is the market lost another -2.52% within seven days of the close of the system. But, the good news is the market then rallied +7.48% from the opening of the Five Down system.

Not that any of that matters. Cause you know the saying...past results are not indicitive of future performance. Ha!

Be careful out there...traders are getting comfortable with the morning rally/afternoon sell-off. They might get more agressive in selling this market.

Daily Systems

Current Open Systems:

Symbol	System	Entry Date	Exit Date	Profit/Loss%
WAG	BreakUp	1/4/2005	open	+3.20%
QQQQ	Tii100Low	1/5/2005	open	-0.39%
QQQQ	BBLower	1/5/2005	open	-0.39%
QQQQ	ATRBreakBB	1/5/2005	open	-0.39%
QQQQ	TrueRVolume	1/5/2005	open	-0.39%
QQQQ	VolSurgeDown	1/6/2005	open	-0.23%
QQQQ	Harami	1/6/2005	open	-0.23%
ACV	BreakUp	1/7/2005	open	+0.89%
			Total	+0.30%

Sunday, January 09, 2005

Weekend Update

Busy weekend. Need rest. Post more tomorrow.

Have a great week!

Daily System Updates

Current Open Positions:

WAG (BreakUp) long with current profit of +2.85%;
QQQQ (Tii100Low) long position with current loss of -0.34%;
QQQQ (BBLower) long position with current loss of -0.34%;
QQQQ (ATRBreakBB) long position with current loss of -0.34%;
QQQQ (TrueRVolume) long position with current loss of -0.34%;
QQQQ (VolSurgeDown) long position with current loss of -0.18%;
QQQQ (Harami) long position with current loss of -0.18%;
ACV (BreakUp) long with current profit of +0.40%.

Weekly System Updates

Closed system positions (sold at last Monday's market open):

SPDE (PennyLag) long with closed profit of +9.62%.

Current open system positions:

QQQQ (SimpleUp) long with current profit of +1.58%;
QQQQ (TurtleTrader) long with current loss of -3.91%;
AATK (PennyLag) long with current loss of -19.05%;
VNWK (PennyLag) long with current profit of +2.03%;
EGHT (PennyLag) long with current loss of -12.97%;
ZICA (PennyLag) long with current profit of +47.83%;
CARN (PennyLag) long with current loss of -2.68%.
HAUP (PennyLag) long with current loss of -6.17%.

Thursday, January 06, 2005

5 Consecutive Closes and a System

I've been staying away from system development ideas for approximately 3 weeks now. I must have been burned out. But, an idea has been ruminating in my mind thanks to the help of a few posts on Roger Nusbaum's site. So, most likely, I'll start backtesting the idea this weekend.

I basically would like to see if there's some substance in creating a covered call trading system. I'm afraid the major problem with a system like this is the fact that too much capital would be tied up to take advantage of the system. But, my curiousity with this idea is getting the best of me.

Truth be told, I've always stayed away from options. Delta, gamma...it's all greek to me. I just figured it's hard enough to do one thing well...so why add more complexity to the task at hand. But, much like pigeons, I gotta make it harder and harder on myself. :)

One more note. The DJ-30 and SP-500 broke their consecutive lower closes today. But, the Nasdaq Composite has now gone 5 consecutive days with lower closes. Doesn't really mean anything though...or does it?

If you would have traded this phenom you would have placed 56 trades since 1990 with a win ratio of 62.50%. And an eaked out an average profit/loss of 0.71%. This assumes of course, you bought at the market the following day the 5 lower closes occurred and sold at the close two days later. Not a great record.

If you would have traded the QQQQ instead of the Nasdaq Composite...your performance would have improved slightly. 42 trades would have been placed since 1990 with a win ratio of 66.67% with an average profit/loss of 1.12%. A little better.

Now, if you just add a little tweak and a little system magic and combine the two...your results improve tremendously. If you only take trades where both the Nasdaq Composite and QQQQ place 5 consecutive lower closes in synch and use the QQQQ as your trading vehicle...you get an average win ratio of 79.17% and an average profit/loss of 2.22%. And the number of trades are reduced to 24. You get better performance and less risk from the combination. Less risk because your in the market less than half the time as when trading the vehicles seperately.

Don't get too excited. This is just a quick test...not a full system.

Are the Nasdaq Composite and QQQQ in synch this time with the 5 lower closes. Yes. So, we can conclude based on backtested results, that the QQQQ will be higher at Monday's close than tomorrow's opening...at least 79.17% of the time.

Anyway, have a great Friday and an even better weekend!

Daily System Updates

Received ACV (BreakUp) long system trigger for Friday's market open.

Current Open Positions:

WAG (BreakUp) long with current profit of +1.96%;
QQQQ (Tii100Low) long position with current loss of -0.85%;
QQQQ (BBLower) long position with current loss of -0.85%;
QQQQ (ATRBreakBB) long position with current loss of -0.85%;
QQQQ (TrueRVolume) long position with current loss of -0.85%;
QQQQ (VolSurgeDown) long position with current loss of -0.70%;
QQQQ (Harami) long position with current loss of -0.70%.