Category Archives: Trend following

Trends And Trend-Following Are Not The Same Thing

It is an empirical fact that trends develop in financial price series. But it is also an empirical fact that in recent years profiting from trends has not been easy. People with skin-in-the-game know that trends and trend-following are not … Continue reading

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CTA Woes Continue in 2016

CTAs have been unable to profit this year according to official sources, adding to a long streak of disappointing returns in recent years. This is despite some notable downtrends in bonds, gold, commodities and currencies this year. Based on statistical … Continue reading

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S&P 500 Getting Close to Its 200-day Moving Average. Should You Worry?

According to comments made in the past by experts, a drop below the 200-day moving average is important. But paying too much attention to expert comments from the past can cost money when market dynamics change.

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Market Timers Looking Forward To An Orderly Stock Market Crash

Market timers profit at the expense of buy and hold crowd when there is an orderly crash followed by a V-bottom recovery. The chart below demonstrates these facts.

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Market Timers And Gambling

Arguments in favor of market timing usually rest on the existence of the momentum premium anomaly and empirical analysis that shows it can be captured with relatively simple strategies, such as moving averages and price rate of change. However, these … Continue reading

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Absolute Momentum Woes

There are now two back-to-back golden crosses and two back-to-back death crosses of the 50-day and 200-day moving averages in S&P 500 that have generated losses. This is the highest number of consecutive losers in the last 66 years. Absolute … Continue reading

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