What happens after an extraordinary big fall in SPY? Volatility trading strategies can be very profitable – both long and short. Let’s find out and test by using some simple variables. To measure a big fall we use the average difference between the high and the low over the last 25 days. We made the…
Does volume matter in SPY? I’m trading SPY, but until now I have not paid any attention to the volume. Let’s test a simple SPY volume trading strategy. Volume probably matters in SPY because a lot of SPY trading is hedging. I trade SPY every day in my day trading simply for hedging purposes. So…
The S&P 500 has shown strong mean reversion tendencies for many decades. One reason for this is the tailwind in the form of 0.04% average return from the close until the next day open, so-called night trading, the lowest hang fruit in the tock market. This article looks at the performance of the overnight session…
What is an exhaustion gap? Exhaustion gaps are like a sign that the market is getting tired of going in one direction. After a long period of rising prices, for example, the market may suddenly gap up more than usual, signaling that it’s ready to take a break. This is a sign that the uptrend…
This has been a pretty bad week for my day trading. Yesterday, Thursday, I recorded my 4th day in a row with losses. The loss was significant as well. I couldn’t remember the last time I had 4 days in a row! Looking through my records I discovered this is the first time it has…
Mondays and Fridays often turn out to be reversals when they move hard either way. Let’s look at a specific reversal trading strategy in S&P 500: Today, we look at an S&P 500 reversal trading strategy that happens on Mondays and has generated 0.77% per trade. Let’s go straight to the trading rules: A reversal…
Mondays have turned out to be reversal days, at least on the long side after a fall on Mondays or the days leading up to Monday. Let’s test a reversal trading strategy: In this article, we test a Monday overnight reversal trading strategy in the S&P 500: we go short on a Monday or Tuesday…
I caught some ideas from Paststat and Quantifiable edges to test “big” movement on Mondays. I have tested this in a previous post, but this time we’ll look at what happens to SPY the rest of the week. Here are the criteria for long: Today is Monday Calculate a 25 day average of the daily…
A while back I wrote about a day trading strategy in SPY. This one works pretty well on XLP as well, with some modifications: The high and low divergence mean reversion trading strategy The strategy is like this in plain English: Trading Rules [am4show have=’p2;p3;p58;p59;p130;p138;’ user_error=’Premium Post Access’ guest_error=’Premium Posts’] Calculate a 25 day average…
This article presents an overnight trading strategy in the S&P 500. Overnight means entering at the close and exit at tomorrow’s open. We exit at the next open no matter the price movement during the night session. We have previously written about other overnight trading strategies plus described the night trading session: Night trading strategies…
