Scanning the 21 markets
tracked weekly by Christian at
www.perfectstockalert.com, and seeing that several major markets (Australia, France and
Hong Kong) have recently officially crossed over into bear market
territory, I thought it might be interesting to compare the
official bulls (however arthritic) and official bears in terms of
how long they’ve been around.
It may not be long before
Canada crosses back over into the bear list, with silver and India
not far behind.
Hadn’t realized how weak Italy
is: the index has fallen more than half since July 2008.
guys - using a 50/200 MA cross is very archaic and you should
not trade from that - quite a while back I posted my own
statistics on MA crosses - the problem is they lag so much and the
draw downs are substantial.
Remember I can test any MA cross you want, I've tested all sorts
of combinations - if you ever want to know the exact statistics,
just ask me, also if you have a Tradestation account I can post the
code here for you to test on your own.
Also, my whipsaw confirmation method when applied to any moving
average crossover system greatly improves them by filtering out the
many false signals that are very common with MA cross systems - if
you look at a MA cross strategy you will notice that many times
when the MA's cross, that's exactly where price reverses back - my
confirmation method filters those out. But even with that, a
MA cross is too slow, by the time MA's cross, the market is going
to be very overbought or oversold at that point, so you would
typically want to wait for a pullback.
Here's my post from back in 2011on the MA crosses - note, I have not updated the
statistics but it doesn't really matter, as you can see the MA
cross system with the whipsaw confirmation method has far superior
statistics - note I've attached two chart examples showing how the
whipsaw confirmation method works, read the text and see the
examples on the charts.
However even still, I would still not trade such a system, for
long term stuff like that my SPX 401K system from 1961 blows any MA
cross system away as does my BPT MA on a month SPX chart.
Regarding 50/200 Day EMA
Crosses:
Over 20 years here's the back testing results. Backtesting
shows that this moving average system works better with a
confirmation candle! what I mean by that is, you need a
confirming candle to validate the cross, this filters out a lot of
the whipsaws.
see the first example as to how to use a confirmation candle
(shows a confirmation candle using 13/34)
here's two sets of statistics, 1 shows the 50/200 cross with and
without the confirming candle
Confirming candle:
Profit factor of 8 and 70% winning trades
Non comfirming
candle: Profit factor of 5.5 and 43.7% winning trades
I've found that no matter what moving average crossover you use,
the confirming candle always makes it better.
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Recent Death Crosses
Posted by audax on 6th of Jul 2013 at 12:23 am
Scanning the 21 markets tracked weekly by Christian at www.perfectstockalert.com , and seeing that several major markets (Australia, France and Hong Kong) have recently officially crossed over into bear market territory, I thought it might be interesting to compare the official bulls (however arthritic) and official bears in terms of how long they’ve been around.
It may not be long before Canada crosses back over into the bear list, with silver and India not far behind.
Hadn’t realized how weak Italy is: the index has fallen more than half since July 2008.
guys - using a 50/200
Posted by matt on 7th of Jul 2013 at 02:08 am
guys - using a 50/200 MA cross is very archaic and you should not trade from that - quite a while back I posted my own statistics on MA crosses - the problem is they lag so much and the draw downs are substantial.
Remember I can test any MA cross you want, I've tested all sorts of combinations - if you ever want to know the exact statistics, just ask me, also if you have a Tradestation account I can post the code here for you to test on your own.
Also, my whipsaw confirmation method when applied to any moving average crossover system greatly improves them by filtering out the many false signals that are very common with MA cross systems - if you look at a MA cross strategy you will notice that many times when the MA's cross, that's exactly where price reverses back - my confirmation method filters those out. But even with that, a MA cross is too slow, by the time MA's cross, the market is going to be very overbought or oversold at that point, so you would typically want to wait for a pullback.
Here's my post from back
Posted by matt on 7th of Jul 2013 at 02:21 am
Here's my post from back in 2011 on the MA crosses - note, I have not updated the statistics but it doesn't really matter, as you can see the MA cross system with the whipsaw confirmation method has far superior statistics - note I've attached two chart examples showing how the whipsaw confirmation method works, read the text and see the examples on the charts.
However even still, I would still not trade such a system, for long term stuff like that my SPX 401K system from 1961 blows any MA cross system away as does my BPT MA on a month SPX chart.
Regarding 50/200 Day EMA Crosses:
Over 20 years here's the back testing results. Backtesting shows that this moving average system works better with a confirmation candle! what I mean by that is, you need a confirming candle to validate the cross, this filters out a lot of the whipsaws.
see the first example as to how to use a confirmation candle (shows a confirmation candle using 13/34)
here's two sets of statistics, 1 shows the 50/200 cross with and without the confirming candle
Confirming candle: Profit factor of 8 and 70% winning trades
Non comfirming candle: Profit factor of 5.5 and 43.7% winning trades
I've found that no matter what moving average crossover you use, the confirming candle always makes it better.