Category Archives: Trading System Analysis

Fooled by Persisting Market Conditions

This blog is related to the previous blog on the RSI(2) but also conveys a much more general message about the impact of persisting market conditions and how they can fool trading system developers. In the case of the RSI(2) it … Continue reading

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Two-Period RSI Versus a Two-Day Losing Streak

The RSI indicator has served as the foundation of several popular short-term trading strategies over the years mainly due to its popularity. In the article I compare the results of a basic system based on a two-period RSI to those … Continue reading

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Let Us Toss a Biased Coin

The quantitative analysis in this blog shows that when a market has an upward structural bias, such as the S&P 500, for example, then random trading based on a biased coin guarantees positive performance over the longer-term. A large percentage … Continue reading

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Free Demo of Price Action Lab Software

There is now a free demo of Price Action Lab available for download. Price Action Lab is the most advanced software for quantitative discretionary and systematic trading based on parameter-less price patterns. Share

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Fooled by Machine Learning Applied to Trading Algo Development

The chances of finding a profitable trading algo by applying machine learning are for all practical purposes zero. There is always a small probability of success  when using machine learning but one of the problems is that the results cannot … Continue reading

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Release of Price Action Lab v7.0

We are pleased to announce the release of Price Action Lab v7.0.  The new version offers several new features and comes with an add-on that allows a massive increase in the capabilities of this quantitative trading software. Share

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Long/Short Symmetry Effect on Trading System Performance

Although some quants prefer long/short symmetric trading systems there is no conclusive evidence that they offer any advantages, especially when dealing with markets with a structural bias. In this blog post I present two examples of the performance of trading systems that were … Continue reading

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