Classical technical indicators like RSI and Stochastic are commonly used to build algorithmic trading strategies. But do these indicators really give you an edge in your market? Are they able to define the times when you want to be invested? This article will show you a way to quantify and compare the edge of technical indicators. Knowing the edge of the indicator makes it an easy task to select the right indicator for your market. Continue reading
Analysing at which time daily market extremes are established shows the significance of the first and last hours of market action. See how different markets show different behaviour and see what can be learned from this analysis.
Probability of Extremes
A day of trading usually starts with a lot of fantasies for the future, then we try to survive the day and end it with a lot of hope for tomorrow. This psychological pattern can also be shown when analysing intraday market data. A high level of fantasies usually leads to a strong market movement, and thus market extremes can often be seen near the beginning or the end of the trading session. Continue reading
Algorithmic trading adds noise to the markets we have known. So why not add some noise to your historic market data? This way you can check if your algorithmic trading strategies are fit for the future. Learn how to generate noisy data and how to test your strategies for stability in a noisy market.
Synthetic market data?
Factor investing has been around in portfolio management for some years. Based on algorithmic rules it became the big thing in trading and the ETF industry. But is there still some money to be made? Is small beta still smart or just beta? This article will give you a Tradesignal framework to test the factor investing ideas by your own. Continue reading
This article is about the dollar cost averaging investment strategy and the influence of luck in it. Continue reading
Since S&P500 has lost 20% from its top in 2018 and everybody is talking about bear markets. See what has happened in history. Continue reading
Analysing the market performance of the day session vs. the overnight movement reveals some interesting facts.
Daytime vs. Overnight Performance
So you are bullish on a specific stock, but you also have realised that timing is major problem? So what would be the best strategy to implement your bullish opinion but avoid the problems of any timing strategy?
Selling a put option might be the answer. Continue reading
“The stock market is never obvious. It is designed to fool most of the people, most of the time” Jesse Livermore Continue reading
In this article I will discuss a simple algorithmic stock picking approach based on momentum and volatility. The goal will be to generate excess returns versus a capital weighted stock basket. Continue reading
Markets have a high degree of randomness (and madness), but there are some things which hardly change over time. One is the width of an average market move before a counter-move can be observed. Continue reading
Over the last days and weeks some traders have been worried if the currently ongoing correction in the markets will evolve into a crash, or if it is just a normal correction. Continue reading
Usually it makes no sense to fight against normal distribution. But there are setups which have got a high probability of unexpected behaviour. Volatility can be the key to future market movements. Continue reading
Volatility trading: when to buy and when to sell volatility Continue reading
The Hindenburg Omen is an indicator which is believed to forecast market crashes. Unfortunately it does not work, but the idea behind this indicator is worth to be discussed. Continue reading
(1) You shall only trade when the chances are on your side Continue reading
“Tomorrow never happens. It’s all the same fucking day, man. ” Janis Joplin Continue reading
Ever since John Bollinger introduced his Bollinger Bands in the early 1980s the bands have been a favourite indicator to all technical trades. This article is about the prediction capabilities of Bollinger bands. Continue reading
I have been in search for a signal I could use for a short vertical spread or naked short option strategy. So my main concern has been to find a level, which will most probably not be penetrated over the next few bars.
This is what I came up with. Continue reading