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Trading Stategy - Simon

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Nolan
Contributor
Hi Simon, I was reading the post yesterday about your trading stategy and am rather intrigued by it, obviously if you are using the moving averages you trade in longer term trades - am I correct? Do you wait for the 15 day to cross the rest of the MA's or just a couple of them? If there is a downward movement in the 15 day, do you look at the MACD to go short or do you just stay long most of the time? Did you go short at the beginning of the month with the correction? A lot of questions I know but I am a bit tired of the intraday stress and this looks like a great stategy.
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19 REPLIES 19
SimonPB
Valued Contributor
no, only go short when primary trend turns down and aside from a few days primary trend has been up since I started with the system in Jan 2005. So the 6 EMA's together only indicate the primary trend and I ONLY tarde in the direction of primary trend (so no short trades since Jan 2005). Secondary trend is indicated by 15EMA, and when primary is up and secondary cuts up through 15EMA, then I go long if next day = close green. Trades length anything from a day or two witht he longest being some 11 weeks. (winners = longer, losers = shorter trades).
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JohnnyCash
Super Contributor
Simon, any particular reason for using EMA vs. SMA?
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Nolan
Contributor
According to the information that I have plotted on IGIndex with the moving averages, how long have you been in the last trade because from what I can see the 15 day has not crossed the others since at least the 16 March, am I correct or does it work differently on a futures chart? If the trend is up and has been since Jan 2005, why ever sell (unless the warrant expires)? What is the eaverage length of your trades and what platform do you use for your information?
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SimonPB
Valued Contributor
I like EMA as it says that yesterdays data is more important then the data the day before and so on - and I agree with that logic as the market has a short memory. But there's not a huge amount of difference.

Nolan, I do not wait for 15EMA to cross the others. I wait for price EOD to cross the 15EMA, the 6 longer ones just give me the direction I will be trading in. As for why ever sell - well yes a buy and hold would have worked very nicely (except for expiry and lack of gearing towards the end of a warrants life and trading fees). BUT the issue is that while we have been in a strong bull the last two years, that is hind sight. Every trade is new and anything can happen, so I trade the price as it is today.
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Werner_1
Super Contributor
can someone please point me to that original post, i would like to hear which MA's you use, Simon, i am very interested as i also use MA's extensively in my system that i am building, maybe i can learn a few things from you...
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liquid
Contributor
Check the "US Data out today" post - it's about two thirds down...
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YNWA
Super Contributor
Werner under the post currently at the top: US Data out today.
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Not applicable
Hi, Do all of the primary trend EMA's have to be in synchronisation, i.e. 30EMA above 35EMA above etc or do you only need them to be pointing in the same direction? Thanks
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SimonPB
Valued Contributor
in sequence (sp?), when they are not but in right direction then I reduce tarde size.
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Nolan
Contributor
So when the EOD price crosses the 15 day EMA you sell and when it crosses back up you buy am I correct?
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SimonPB
Valued Contributor
no. when the primary is up and then the eod crosses the 15ema I buy (if next day is green). Then as I am in the tarde I ignore all ema's and focus on my exit. I only short when primary is down.
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Nolan
Contributor
When do you exit? P.S thanks for putting up with the questions...
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SimonPB
Valued Contributor
exit is initial 20% trailing stop on the derivative. When trailing = entry I made that the lowest exit price and move to dow theory exit. That is I exit a long on a lower low on the index eod.
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Nolan
Contributor
Oh Ok, I sort of get it, so if the low of today is lower than the low of yesterday you exit?
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SimonPB
Valued Contributor
almost, the index maskes a close after some downside and then moves higher. The close at the low is now my exit, if breached. If the next down leg does not breach that exit low before moving higher again then the new (and higher) low is my exit.
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DCTrader
Super Contributor
Simon, you get my mail?
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SimonPB
Valued Contributor
ya, digging for some answer. more complicated then seemed.
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DCTrader
Super Contributor
That's the problem... in theory the concept works but I've been struggling to roll with it because of the red tape and systems requirements. Even to establish it as a central information point requires buy-in from the brokers. Thanks for the help!
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Not applicable
Hi Simon, When doing short term trading, do you do it in your own name or trust or how do you go about for maximum tax relief / minimum tax exposure ?
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