Trading System Ideas

[azouz110]

I started this thread to share with you some trading system ideas.

My first technique would be to use intercorrelation between sector ETFs to create a sentiment indicator to predict movement of the S&P 500.

Market Sector Correlations as Sentiment Measure - Seeking Alpha

The idea is to take several sector ETFs, calculate the intercorrelation between these ETFs, take the absolute value of each correlation then average the result.

Here is a ready to use indicator you can use in QuantShare:
Sentiment Measure Using ETF Sector Correlations

 

[NVP]

interesting - and then how do you trade it ?

N

 

[azouz110]

Like any sentiment indicator, there are several ways to trade this.
But I am going to post only ideas and techniques here. I am not going to explain how to trade each one.

 

[Babyblush]

How about developing a trading system just with the price action alone without much usage of the indicators.

 

[ZoomPips]

What would be the best components to use in a trading system? Direct price action and patterns or priced derived indicators? Would be interested in responses. Has anyone ever tried building statistics into trading system like statistics on the average retracements after a move of x percent?

 

[wilczek]

Agreed - There is one called Price Action Swing Trading (PAST) Strategy I am looking at and also another one called Price Action Trading Equation (both free) - Here's the links - Assuming they are allowed - Price Action Swing Trading (PAST) Strategy eBook « Forex Useful - price action trading - - Price Action Trading Equation

Perhaps others can add more ...

 

[NVP]

Like any sentiment indicator, there are several ways to trade this.
But I am going to post only ideas and techniques here. I am not going to explain how to trade each one.

great ..........my idea is to trade forex .........but I cant go into any further detail here..........

N

 

[neil]

very interesting!!!!

Sinceyou are a spread betting company what is your idea of the best trading system?

 

[wackypete2]

Sinceyou are a spread betting company what is your idea of the best trading system?

Let's give him some more time. He's still thinking.

Peter

 

[The Leopard]

Here's a good system.

Trade only liquid instruments traded on proper exchanges. ES on CME is ideal.

Buy (or sell, as the case may be) pullbacks. Trade only in the direction of the trend. Do not under any circumstances attempt to trade reversals.

Cut losses quickly. Trail winners up with generous room. Where still in, just close at the end of regular trading hours.

Take only those opportunities that seem to be the strongest. It is impossible (and useless) to put a number on this, but in general on average you can probably expect a couple of trades a week. The point is, a small number of trades each month is normal and to be welcomed.

Work on increasing the number of contracts you trade.

That's it.

 

[numbertea]

I trade ES reversals, I win, I lose, but it works for me. Look at all possibly viable trading systems, find one that inspires you and improve it so that it works for you. That is the best system you will ever find.

Cheers