It think it might be best if we define a 'range' in some way, for example 3 losers in a row. If such a thing happens we might hold the method in stasis,perfectly hedged and adding long or short positions based upon the high/low points of the range rather than a break of the ma's upper/lower boundaries.
Extended ranges such as the one experienced in the last quarter of 2006 are highly detrimental to the system, but seem to be successfully counteracted in this way.
Also, it might be worth considering reversing the system at this time such that one buys at a break of the lower boundary and sells at a break of the upper. with T/p's being the opposing boundaries and stop losses the breaking of the range supports.
An end to the 'ranging' period would be defined by one of these trades being a loser.
Another thing I have noticed is that though the longer 100 ma is much more stable in normal market conditions, the 25 ma gives a much better indication of a reversal point at the top of trend surges.
If one plots the 25 and 100 ma's on the same chart and define a surge as being when the 25 Ma's lower boundary is fully above the upper boundary of the 100 ma then a breach of the 25 usually signifies a coming breach of the 100, thus giving an earlier and more profitable signal.
(i'm plotting both these on the 1 hr chart)
Extended ranges such as the one experienced in the last quarter of 2006 are highly detrimental to the system, but seem to be successfully counteracted in this way.
Also, it might be worth considering reversing the system at this time such that one buys at a break of the lower boundary and sells at a break of the upper. with T/p's being the opposing boundaries and stop losses the breaking of the range supports.
An end to the 'ranging' period would be defined by one of these trades being a loser.
Another thing I have noticed is that though the longer 100 ma is much more stable in normal market conditions, the 25 ma gives a much better indication of a reversal point at the top of trend surges.
If one plots the 25 and 100 ma's on the same chart and define a surge as being when the 25 Ma's lower boundary is fully above the upper boundary of the 100 ma then a breach of the 25 usually signifies a coming breach of the 100, thus giving an earlier and more profitable signal.
(i'm plotting both these on the 1 hr chart)
quote of the day:
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It's like deja-vu all over again