More Signals from More Indicators = More Profit?

Oct. 16, 2023

This trading year has been unique.

And not in a fun way.

Many strategies that have worked for years (and tested out well for decades) suddenly have been gobbled up by the constant reversals.

But some strategies are still holding up, as we learned in last week’s Newsletters.

It’s really the price-based breakout strategies that have gotten hammered. For some reason, traders and institutions have been pounding on breakouts to new highs or lows while breakouts from indicators have not been punished.

Remember, the 40in2out strategy trades a breakout to a new high based solely on price, and it’s down for 2023 (after making monstrous gains the past few years):

And Purple Valley is a traditional buy-a-new-high breakout fund also, and it’s been hit hard this year after thriving previously:

Indicator-based systems, though, have survived.

So, if breakouts from one indicator are still viable, what about breakouts from multiple indicators?

Would more indicator signals lead to more profit?

Let’s find out.

As you may know, I built the Master Trend robot for indicator-based trend following. But it was also built for research. That’s why it has the ability to trade breakouts from three indicators: Bollinger Bands™, RSI, and Stochastics.

But Master Trend also has the ability to take trades from all three at once.

Well, not really all at once. It can take entries from any of the three, whichever comes first.

In other words, if all three are activated, we can get a trade from Bands, RSI, or Stochastics. We’re not limited to just one.

Does activating all three work?

Here’s the Report on a 1-hour Master Trend robot on the GBPJPY only in 2023:

Trading 1 lot each time, it’s hypothetically done nicely this year.

Here’s the Curve:

It looks like the ability to take more signals from more indicators does have the potential to produce more profit.

In our next Newsletter, we’ll look deeper at this strategy and go back in time to see if taking multiple signals has any validity outside of weird 2023.

Talk to you soon.

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Disclaimer:
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results are not necessarily indicative of future results. Examples presented on these sites are for educational purposes only. These set-ups are not solicitations of any order to buy or sell. The authors, the publisher, and all affiliates assume no responsibility for your trading results. There is a high degree of risk in trading.

HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.