This week's price bar is currently above the trend-line drawn across recent lower highs. Because it is a fairly steep trend-line, price making its way above the line does not seem all that significant on its own. But there are other factors that have my attention right now.
Prices have made slight new lows since the last post, so the trend is still down. If I were short this market right now (unfortunately not), stops would be moved down to 1.0748. We just keep stepping this down with what appears to be a deteriorating trend.
Swiss Franc moving average envelopes are still in downtrend mode on both the weekly and the daily charts. The real story here is the daily RSI.
While both weekly and daily RSI indicators are in downtrend range, the daily RSI continues to form a positive velocity divergence with price. This indicates a possible intermediate term low in the making.
The Dynamic Trailing Stop indicators is still in downtrend mode on both charts. Notice that the stop suggested earlier is right in between the two exit levels proposed by DTS. Any of these levels would be fine for someone who is holding shorts right now.
Weekly ADX shows non-trending behavior. Daily ADX is again registering trend with the new lows.
As some readers might know, I have been playing around with programming automated systems in my free-time. Although this has been a self directed learning effort, I have no prior experience in writing computer programs. I am relying on books and a lot of experimentation. Human input would be great! If any of you out there work on this type of thing, I would love your input and feedback. Trust me, I have questions!
Many of the systems simply have not worked well (expected), while others have actually worked well enough for me to continue various testing and development phases with them. Simple systems seem to work the best. Ultimately, I may trade a different account with these systems. Here is what trades (no position size adjustments; only entry and exit signals) with one of my medium to long-term trend-following systems would have looked like in the Swiss Franc futures contract over the past year:
Blue (or is it teal? I kind of suck with colors.) dotted lines connect entry and exit to winning trades. Red dotted lines connect entry and exit to losing trades. The blue are easier to see because the system does not stick around in a losing position for a long time, but will let the winning position run until signaled that the trend is ending.
I like how this system operates! It does get whipsawed in sideways markets, but it is really good at catching the major trends and profiting from major upside and major downside movements. Most importantly, it seems fairly robust across many markets. My current goal is to to keep working with it to see if I can filter out more of the noise or not. Note that the system stop is right in the same area that simple price bars as well as the DTS indicator suggested earlier in the post! I am taking this one step at a time, and moving slowly into this automated trading systems world, but it is very exciting nonetheless!
At the time of this post 1 USD = 0.94923 CHF.
Current Stance:
Long Term: Flat
Intermediate Term: Flat
Definitions:
Flat = no position / not long or short the market.
Sell Short = positioning to attempt to profit on price declines
Buy / Long = positioning to attempt to profit on price advances
Hold = hold a long position
Hold Short = hold a short position
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