Did you study intraday return with following conditions 1. price should be more than 50 period and above 13 period on 15 min (as its intraday (ideally it should 5 min chart)) to buy and sell by 3 pm or price goes down 21 period of 15 min chart. As i do not have source and not having require skills to back test it, But pl. do it to know actual result on base of above condition, and i think that would give real picture
Hi Manish, you will be surprised to know that one of the first trading system that I had back tested was exactly on these lines. Unfortunately the returns are not attractive and have very high drawdown periods with profitable days far & few in between. Few reasons why this system fails:
1. SMA is a significantly lagging indicator & in the premise of intraday its quite late to enter based on this lag
2. Larger swing trends when they start carries on for 2-3-4 day. But because the position is squared off at 3/3:15 some part of the move is lost that day, a good part on the gap up in next day.
3. When the trend carries on into the 2nd or 3rd day, fresh entries are absent as by then both the SMA/EMA have moved far apart for crossover.
4. Only when the stock/index is in sustained uptrend this works but gives back a lot in sideways and moderate trends.
Thank for study and reply
Hi,
Did you study intraday return with following conditions 1. price should be more than 50 period and above 13 period on 15 min (as its intraday (ideally it should 5 min chart)) to buy and sell by 3 pm or price goes down 21 period of 15 min chart. As i do not have source and not having require skills to back test it, But pl. do it to know actual result on base of above condition, and i think that would give real picture
Hi Manish, you will be surprised to know that one of the first trading system that I had back tested was exactly on these lines. Unfortunately the returns are not attractive and have very high drawdown periods with profitable days far & few in between. Few reasons why this system fails:
1. SMA is a significantly lagging indicator & in the premise of intraday its quite late to enter based on this lag
2. Larger swing trends when they start carries on for 2-3-4 day. But because the position is squared off at 3/3:15 some part of the move is lost that day, a good part on the gap up in next day.
3. When the trend carries on into the 2nd or 3rd day, fresh entries are absent as by then both the SMA/EMA have moved far apart for crossover.
4. Only when the stock/index is in sustained uptrend this works but gives back a lot in sideways and moderate trends.