Pascal
11-16-2014, 06:55 AM
KEX is in a trading range, but shows negative EV
26947
The problem is that the downtrend is rather new and it is difficult to know whether this pull-back is going to revert back-up or generate a new sell-off.
26948
We only analyse here a breakdown on volume below 104. If we take 60 days as analysis period, then the returns look good (we have been in a downtrend for the last 60 days)
26950
If we now use 300 days (most of this period was an uptrend,) we can see that the returns still look OK.
26949
However, if we increase the number of holding days from 5D to 10D, then even though the 60D work fine, a 300 days period is rather negative.
26951
26952
This tells us that we should only trade short-term for now. However, the holding period is a false issue, because we do not need to decide today if e hold for 10 days. We can decide after reviewing the results early in the trade: if returns look good, we can analyze the situation and decide to keep the trade or not.
26947
The problem is that the downtrend is rather new and it is difficult to know whether this pull-back is going to revert back-up or generate a new sell-off.
26948
We only analyse here a breakdown on volume below 104. If we take 60 days as analysis period, then the returns look good (we have been in a downtrend for the last 60 days)
26950
If we now use 300 days (most of this period was an uptrend,) we can see that the returns still look OK.
26949
However, if we increase the number of holding days from 5D to 10D, then even though the 60D work fine, a 300 days period is rather negative.
26951
26952
This tells us that we should only trade short-term for now. However, the holding period is a false issue, because we do not need to decide today if e hold for 10 days. We can decide after reviewing the results early in the trade: if returns look good, we can analyze the situation and decide to keep the trade or not.