|
PureBytes Links
Trading Reference Links
|
Hello Dirk,
I think for strictly mechanical trading system channel breakouts, with
filtering are fine. However the reason for this study was not to have
a mechanical system. But rather it was created so that I could
better statistically trade selling options on both sides of the
markets. This study helped me have a statistical understanding of
what the odds were in my favor or against me. How much heat would I
have to endure, if I was wrong. And if I was correct how long could
I expect it to last? While this is not a system, I do believe
over time you will learn to respect it, if you watch it.
DdV> Do channel breakout systems perform better or worse depending on volume?
Of course a perfect world average volume of the best for the entry of
channel breakout system. With ever increasing volume as a trade
progresses in your direction. More often than not, enthusiasm
leaves shortly after the breakout. Leaving hopeful traders out to
dry.
DdV> My own channel breakout sys that I use on big caps breaks down when avg
DdV> volume on NYSE falls below its 50 day moving average, and esp below 200
DdV> day moving avg (as per right now). This might apply to SPY (ie. the
DdV> exchange traded fund for SP500) right NOW but not on AVERAGE. This happens
DdV> to my channel breakout system even though it trades short quite often as
DdV> well.
It sounds as though you have understanding of market participation in
the pitfalls of the system which is based strictly on price movement.
--
Best regards,
Mark Brown mailto:markbrown@xxxxxxxxxxxxx
|