Trading Rules

Timing the Nasdaq 100 Index:

The Nasdaq 100 Index was launched in January 1985 and comprises the largest non-financial companies listed on the NASDAQ stock market. Most of the 100 issues are well known companies, such as Microsoft, Qualcomm, Intel, Cisco Systems, eBay, Amgen, Dell, etc. There are many ways to trade the Nasdaq 100 index.  Because of its wide usage, the Nasdaq 100 is one of the most heavily traded indices on the planet.  Most traders are familiar with the wildly popular Nasdaq 100 Trust (symbol QQQQ, also commonly referred to as the "q's" or "cubes)--an exchange-traded fund (ETF) that tracks the Nasdaq 100 index.  This ETF (symbol QQQQ) is one of the most liquid issues on the NASDAQ. It is probably the most efficient way to trade this index

Another way to trade the Nasdaq 100 is through Nasdaq 100 futures contracts.  Nasdaq futures were designed by the CME to track the Nasdaq 100 Index.  Like all futures contracts, Nasdaq index futures require only a small margin deposit. With Nasdaq futures contracts, you can trade the Nasdaq 100 index with a relatively small investment.

There are also hundreds of mutual funds that track the Nasdaq 100 index and many more tracking funds popping up regularly.  Each Nasdaq 100 tracking mutual fund sits at a different price depending on how that particular mutual fund company calculates its price.  Some mutual funds track the NASDAQ 100 index with a performance of 200 percent over the Nasdaq 100 index. This means that if the Nasdaq 100 index moves up 1 percent, the fund will move up 2 percent. 

The above are just a few of the many trading instruments used to trade the Nasdaq 100 Index. 

About System Max Profit:

The trading signals are based on a trading system which was developed in 1999. The specific details of the system are proprietary but the signals generated from year 2000 to date are listed on the Trade History page.  The system uses a sophisticated mechanical approach to triggering signals.  In essence, it looks at many different rules and inputs every trading day, then measures risk before issuing a signal.  In trading, its all about position risk.  For example, if the general market risk is high, the system will stay in cash regardless of market moves. In a strong up trend,  it  will avoid shorting (unless the risk is very low) and focus on long plays. In downtrend markets, the system may take both longs and shorts.  Max Profit system will also evaluate seasonal patterns, breadth, expiration plays, day of week/month,  trends, supports, resistances, etc . These are just a few of the many rules it  looks at every day.  Max Profit system also looks at long term rules to determine how aggressive or conservative the signals should be going forward. For example,  if the longer term rules give the system a strong bearish view, the system will become aggressive on shorting and very conservative on any long signals. Vice versa if longer term view is bullish. So it does not matter what the trend in the market is today or tomorrow, because Max Profit system evaluates the current market conditions and adjusts accordingly when major market trends change. 

Rules are as follow:

A unique feature about the system Max Profit, is that it can take up to THREE  positions in any direction.  In some cases there may only be ONE position followed by an exit, or TWO positions followed by an exit, or the full MAX THREE positions followed by an exit.

Here is how the system trades:

When a signal is triggered, the system takes action on the 4:00 pm ET closing price of the QQQQ.  For Nasdaq 100 futures, the signal is still triggered at 4:00 pm ET, but the system acts on the 4:15 pm ET futures closing price.

The performance shown on the Trade History page is based on all signals generated. But now let me tell you a few tips about FIRST, SECOND and max THIRD signal. In general, based on history, when the system signals a FIRST signal, it is somewhat a more aggressive signal than the others, because fewer rules are required to trigger this signal. The SECOND signal is a more conservative signal since many more rules need to play out to trigger the SECOND signal. First signals have a probability in the low 60% of being a profitable entry, while the more conservative SECOND signal has a probability in the mid 80% of being a profitable entry. 

About XTR Dev QQQQ System:

XTR Dev QQQQ system is a simple tool that uses statistical analysis of price. The standard deviation of QQQQ price is calculated over a period of years.  Standard deviation is a statistical measure of spread or variability.  It is the root mean square deviation of the values from their arithmetic mean.  The square of the standard deviation is a measure of the degree of spread among a set of values, a measure of the tendency of individual values to vary from the mean value.

Standard deviation is sometimes difficult to explain.  Think of it as kind of the "mean of the mean," and often can help find data points of interest (in our case price of QQQQ).  Deviation can be described as a variation that deviates from the standard or norm "the deviation from the mean".  The XTR Dev (Extreme Deviation) system combines both of the above, to point out when QQQQ price has advanced to an EXTREME point.

An EXTREME deviation move from the mean can also be described as an outlier meaning a value (in this case QQQQ price) that has moved far from most others in a given set of data.  In simple terms, a price move that is abnormal and at some point must retrace to the mean price.

When the QQQQ price moves to an abnormal level, the system triggers an  Extreme Deviation move from the norm (XTR Dev).

The XTR Dev takes an aggressive approach to trading the long side of QQQQ.  The main objective of this system is to beat the Buy and Hold.  XTR Dev QQQQ System only trades the long side. XTR Dev QQQQ System has been profitable every year since inception.

Rules are as follow:

Prior to market open, the XTR Dev QQQQ alert price triggers are posted on the Current Signal web page.  The XTR Dev QQQQ system would then take a position or exit a position if these trigger QQQQ prices take place at the exact 4:00 pm ET QQQQ closing.  

Only a maximum of two long positions are allowed at any given time.

A reminder that past performance in not a guarantee of future performance and users should read the disclaimer.

Past performance is no guarantee of future results. Please read Disclaimer
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