IWM Simulation for Entries on Monday

[Pascal]

Billy,
Am I correct in thinking the robot siganls are independent of a short signal of the 20DMF? So even with a TEV extension on inverse ETFs turning red, the robot could still be looking for a long position on Monday? Correct?
Dave

In reality, there are three stages in the decision process:
1. The robot looks at the 20DMF market direction model (the signal must be TEV confirmed for shorts).
2. On that base, the robot will go dig into its trade statistics for short or long positions. The set of statitics is different depending if the 20DMF direction is long or short. The robot then compares the probabilities of short and long positions both LT/SH and then decides to go long or short.
3. Once the trade direction is taken, then the robot looks at the pivots and the 3:1 reward-risk.

When you see this process, you can understand that the 20DMF plays a major role. However, it happens that on step 2, the robot finds a different conclusion from the 20DMF direction model. This is however extremely rare (less than 1% of the cases) and when this occurs, it is only anticipating a 20DMF signal change by one day or so.

The process for the GDX robot is identical, except that the GDX robot does not care about the 20DMF. It works on its own MF direction model, which is explained in the GDX reference documentation.

Pascal