Trading With Tick Index: Early Detection Of Trend Buy Day (Signal ID – TICK Trend Buy)

By Lawrence

Trend buy day are the days where the stock market indices just keep going higher. Day traders are often trapped on the wrong side of the market on such days due to various price based measures telling them the up moves are over extended. What they fail to realize is that the market has been driven by the buying of the underlying components on those days thus the index future has no choice but to follow.

Being able to detect this undercurrent before it turns into all out rally can be a life saver for day traders. Tick index is one of those tools best at giving us such information early on. Following is a basic day trading model showing you how to capture a trend day with the NYSE Tick Index.

The Performance

Following is a net dollar gain chart of the trading model trading a single Emini S&P contract. Commission of $2.5 per contract per trade is already deducted from the net gain.

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Comments
  • smilingsynic October 25, 2013 at 12:25 am

    Interesting. System did extremely well in the 2008-9 bear market, even better than in bull markets. Somehow I doubt negative tick days (sell @ 10 am if avg tick < X) would have the same kind of profitability

    • Lawrence Chan October 25, 2013 at 10:25 am

      trapped shorts behave differently comparing to trapped longs

      so yes the trend sell version is not based on the same concept

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