Trading Methodology
SPI • NIKKEI • TAIWAN •
HANG SENG • DAX • FTSE • NASDAQ
If you are considering subscribing to my daily advisory newsletter its important (in my opinion) that you have an understanding of the overall methodology I use. Understandably I’m unable to make a full disclosure however it’s important for you to be comfortable about how and from what direction IndexALERT™ finds its trade levels.
It will be this small understanding that will assist you in determining with, or without the assistance of a licensed financial adviser, whether the general trading suggestions will be appropriate for your particular needs, financial situation and investment objectives.
I hope here that I’ll be able to give you a little insight into how IndexALERT™ works. I should also say at this point that if you have spent some time reviewing my web site and trading models that you’ll already be aware that I have a strong preference in using simple short-term pattern based methodologies that shy away from indicators. Well it won’t come as a surprise to you that IndexALERT™ operates along the same line.
In a nutshell IndexALERT™ operates a simple mechanical pattern-trading model that does not employ any indicators with adjustable parameters.
The way it works is this. IndexALERT’s™ trading model merely scans the SPI, NIKKEI, TAIWAN, HANG SENG, DAX, FTSE, NASDAQ and S&P500 index contracts looking to identify recurring high probability trading patterns. It operates the same simple yet robust model across a global portfolio of index contracts that all futures brokers can service.
IndexALERT’s™ short-term pattern-trading model is straightforward and operates on a very simple premise to achieve its edge, and it is this. It simply searches for patterns that identify possible points in market structure that could either be a significant;
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Support Level, or
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Resistance Level.
Once these areas are identified the model will produce either a BUY or SELL signal.
A buy signal will be produced if either;
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The identified support level holds, suggesting higher prices ahead, or
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The identified resistance level fails, suggesting higher prices ahead.
A sell signal will be produce if either;
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The identified resistance level holds, suggesting lower prices ahead, or
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The identified support level fails, suggesting lower prices ahead.
All signals are accompanied by stop levels and IndexALERT™ provides continual trade management until positions are exited. IndexALERT™ cuts losing trades quickly while letting winning trades run.
Well I hope this gives you a little insight into IndexALERT’s™ trading methodology and if something is a little unclear please do not hesitate to contact me at bpenfold@tpg.com.au and I’ll try to clear it up for you. Thanks for taking the time to review this overview of IndexALERT’s™ trading methodology and if you do decide to become a subscriber I’ll look forward to welcoming you to IndexALERT™ and adding you to my IndexALERT™ group.
Brent Penfold