Quote Originally Posted by lulzasaur View Post
Hi Pascal,

going along those lines of thinking, I was wondering if it might be beneficial to have multiple robots instead of one that would rotate depending on what current market conditions were. For example, in turbulent markets such as this, we would switch to a robot that would be more sensitive with different rules; whereas in a "normal" market we would switch to a slower robot. An idea to measure whether or not we are in a "normal" market could be determined by a myriad of factors including but not limited to readings on the $tick, price volatility, etc etc. I think part of the problem with models (by other people) in the past is trying to put a "one size fits all" strategy which does not work very well.
Today's market action does not request specific explanation. Money management and stop loss is what is important.
Even if the IWM robot is in a long and probably stopped out position today, the signal was very weak and let's hope that everyone followed our advises not to trade weak signals. The string of losses on the robot came from the 20DMF's miss on the short signal about 10 days ago. For now, the 20DMF is in oversold, waiting for a buy signal which will surely come, even if we are now in a sell-all situation.

What we might do in the future is run two separate versions of the robot: a "trade all" signals and a "trade strong signals" IWM robot.

I have however to study more on how to manage the last 20DMF short miss. There is nothing urgent here, as we are in a "buy wait" mode. The "buy" side works as before. Simply be aware that without QE3 there is little chance that this market comes back in a bull mode very quickly. But buyable opportunities and shortable bounces will come along the way.


Pascal