Originally Posted by
Billy
Adam,
This is at the source of the statistical reliability problem. The 20 DMF was in confirmed shorting mode during all of September 2008 and had its first market direction signal change with a cover your short/buy signal on October 10, 2008. The robot did manage the trade well because it was looking for short positions durring all of that time Currently, the 20 DMF is already in unprecedented oversold territory and waiting for a long signal. Under such circumstances, the robot decides independently of the 20 DMF, and based on ST/LT statistics, whether to go long or short. But because the database only has a very few ST/LT combinations similar to today's, this is the exception to the rule that should be applied instead.
Billy