Uptrend and Oversold Index Swing Trading System 8H

2022년 3월 29일

--- Foreword ---
The Overbought and Oversold Index Swing Trading System or short: I11L Hypertrend primarily uses money management Strategies, EMA and SMA and my momentum Ideas for trying to produce satisfactory Alpha over a timespan of multiple years.


--- How does it Work? ---
It uses 20 different EMA's and SMA's to produce a score for each Bar.
It will credit one Point If the EMA is above the SMA.

A high score means that there is a strong Uptrend.
Spotting the strong Uptrend early is important.
The I11L Hypertrend System trys to spot the "UPTREND" by checking for a crossover of the Score(EMA) / Score(SMA).

A low score means that there is a strong Downtrend.
Its quite common to see a reversal to the mean after a Downtrend and spotting the bottom is important.
The System trys to spot the reversal, or "OVERSOLD" state by a crossunder of the Score(EMA) / Score(SMA).


--- What can i customize? ---

-> Trading Mode: You can choose between two different trading modes, Oversold and Overbought(trend) and Random Buys to check if your systems Profitfactor is actually better then market.

-> Work with the total equity: The system uses the initial capital per default for Backtesting purposes but seeing the maximum drawdown in a compounding mode might help!

-> Use a trailing SL: A TSL trys to not lose too much if the trade goes against your TP

-> Lookbackdistance for the Score: A higher Lookbackdistance results in a more lagging indicator. You have to find the balance between the confirmation of the Signal and the frontrunning.

-> Leverage: To see how your strategie and your maximum Drawdown with the total equity mode enabled would have performed.

-> Risk Capital per Trade unleveraged: How much the underlying asset can go against your position before the TSL hits, or the SL if no TSL is set.

-> TPFactor: Your risk/reward Ratio. If you risk 3% and you set the ratio to 1.2, you will have a TP at 3 * 1.2 = 3.6%

-> Select Date: Works best in the 8H Timeframe for CFD's. Good for getting a sense of what overfitting actually means and how easy one can fool themself, find the highest Profitfactor setting in the first Sector (Start - 2012) and then see if the second Sector (2012 - Now) produces Alpha over the Random Buy mode.


--- I have some questions about the System ---
Dear reader, please ask the question in the comment Section and i will do my best to assist you.

2022년 3월 29일

릴리즈 노트

Corrected the Leverage input to actualy account for the Risk Capital unleveraged.