Thursday, August 11, 2011

JBIT Intermediate-Term Trading System

While I have long considered MOMENTUM (MOM)
to be one of the top 3 trading indicators,
I have not given sufficient attention
to another one of my top 3 -

If you are familiar with WAD then you know that it’s a:

  • Very stable indicator
  • It changes direction slowly
  • It tends to IGNORE many random moves in prices, and
  • It tends to keep you in moves for a relatively long period of time

My long time friend Larry Williams, vastly improved
the volume-based AD indicator, creating
Williams Accumulation Distribution (WAD)...
which is an integral part of the trigger
for my moving average channel method.

WAD, combined with my channel, has the ability
to capture huge moves and it can hold winning trades
for a relatively long period of time

The downside of using a very stable indicator is that it ignores many spurious moves
and loses some sensitivity –
but what it loses in accuracy it GAINS in the ability to capture large moves!

As an example, consider the current long term bull market in gold…
as you can see from the chart below, my WAD/MA (57 period MA of WAD)
went into buy mode in 2003 and has remained in buy mode since then;
there have been NO SELL SIGNALS!

How does JBIT Do it?

I have combined the better qualities of WAD/MA with Momentum (MOM)
in order to develop a trading system which does the following:

Signals are Generated Daily for the Following Markets

JBIT provides daily buy, sell, hold, stop and trailing stop--daily for the markets in the portfolio.

Jake Bernstein