The Nasdaq Loves Keltner Channels

May 15, 2024

In our last Newsletter, we looked into Keltner Channels.

Are they as good as Bollinger Bands™?

In our first example using the ES Futures contract, a Keltner breakout was pretty good. But I wouldn’t say it was better than Bands.

So today we’ll try the Nasdaq (NQ.D). This instrument obviously trends more so we might get better results.

And we’ll take off the time exit. We’ll let it get to its target or stop no matter how long it takes.

Once again, we’re testing 60-minutes and only going Long.

Here are the details:

60M Keltner Channel NQ.D Breakout (Long Only)

• Entry: When price closes above the upper Keltner Channel (Length 80, ATR 1.5)
• Target: $2200 per contract
• Stop: $1100 per contract

Because NQ is more volatile, we had to increase the target and the stop.

Using Portfolio Architect, here’s how it’s done since 2001 trading 1 contract each time on a sample $20k account:

That’s definitely more hypothetical money than ES. Here’s the Curve:

And the Curve looks better, too.

It’s up over 700% during this period.

Is this as good as Bollinger Bands™? We’re definitely getting closer.

It’s interesting that a hard-trending instrument did better.

In our next Newsletter, we’ll look at another instrument that has big trends.

Talk to you soon.

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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.