Making new equity highs on a system feels great – but it's also very important. It shows that the system has not been over-optimized. With today's system designing platforms it's all too easy to run the optimization routines and develop the "perfect" system. I learned that the hard way. Now my system signals are very simple – no optimized values, one line for an entry, one line for an exit, etc.
Plus, I was lucky stumbling upon the TRIN – I do believe it has some leading indicator properties. Look at today's action – the adjusted TRIN Indicator reading was zero. Yes it was up day but according to the TRIN there was as much selling going on as buying. So profit taking as the market was going up. And I believe that was what was going on.
TRIN Indicator System Signals (Emini daily)
We finally took profits on a cluster of Long positions, exiting at the close. I trade a sub-set of these TRIN Indicator systems to reduce the number of trades, so I didn't have all these contracts on.
TRIN Indicator System New Equity High (Emini)
And a new high on the equity chart. It's been a few months since we made new highs and there's been some pain along the way – but that's system trading.
TRIN Indicator System Performance (Emini)
Lastly, the system performance stats. Remember, these are just "sample" systems that are possible using the Better TRIN Oscillator. You need to test and add your own money management rules.
Profit Taking Volume at End of Day (Emini 27 min)
Volume action at the end of the day showed profit taking on large volume. This is more like the pattern we should be seeing near a market turning point. I'm watching the next couple of days closely for weak closes on high volume bars then testing of the highs on low volume.
Good luck with your Emini trading.
