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2012issue C1254-57

Staged stops as one mechanical entry and exit procedure

A price-only algorithm can stage a prebuy or presell together with a protective stop and more than one profit-taking level. Editorial point: treat that package as one mechanical procedure, and treat a blank scan as an abstention rather than a prompt to improvise.

  • A single price-only algorithm can emit buy and sell signals for stocks, exchange-traded funds, futures, and currency pairs.
  • Each staged signal is packaged with a protective stop and more than one profit-taking level, so exit is specified with the entry.
  • A daily presell can be treated as a stronger short candidate when it coincides with bearish readings on shorter bars and on the weekly frame.
  • Editorial takeaway: write the staged entry, the protective stop, and the targets as one procedure, and treat a blank scan as an abstention rather than a prompt to improvise.
Entries in this reading3 entries

What the workflow emits

A single price-only algorithm can emit buy and sell signals for stocks, exchange-traded funds, futures, and currency pairs. Short-horizon setups are taken from intraday or daily data, while long-horizon setups are taken from weekly data. Intraday signals are defined on five fixed bars of 15, 30, 60, 120, and 240 minutes.

The system's output is a signal: an instruction to enter, exit, or stay out. In the terms used here, that makes the workflow a mechanical-trading-system, a complete and repeatable set of entry, exit, and abstention rules applied the same way each time the inputs appear. A rule-based-entry is the predefined condition that issues the buy, sell, or stand-aside instruction from market state and execution constraints rather than from discretionary judgment.

What is chosen before a scan runs

Before a scan runs, the user chooses market, time frame, bullish or bearish bias, and whether the desired signal is a prebuy or a presell. The tradable universe can be narrowed by subcategory, price limits, and a minimum-volume filter.

Staged stops arrive with exits already written

A prebuy is a staged long entry price that has not yet traded and is placed in advance as a buy-stop. A presell is a staged short entry price that has not yet traded and is placed in advance as a sell-stop. In this workflow, a prebuy or presell is a staged stop price that has not yet been reached at the last scan update.

Each staged signal is packaged with a protective stop and more than one profit-taking level so exit is specified with the entry. The holding-period is the time a position remains open once the system's entry rule has fired. Editorial reading: the package is written for that holding-period, so the trader is not asked to invent an exit after the signal appears.

A top-down short search ranks weak sectors, then industries inside those sectors, then the weakest names for presell signals. A name can be treated as a stronger short candidate when a daily presell coincides with bearish readings on shorter bars and on the weekly frame. Time-frame-alignment is that check: whether shorter and longer bars agree before the signal is treated as confirmed.

Editorial framing: the procedure follows the prevailing trend across the holding-period instead of forecasting a reversal, which is the sense of a momentum-strategy used here.

A calendar of past marks

Past buy and sell marks can be reviewed on a calendar of daily and weekly history for the market or for a single security. Editorial reading: the calendar is for reviewing how the mechanical-trading-system already marked the tape. It is not a substitute for a blank scan, and it is not a reason to write a new rule on the spot.

Bed Bath & Beyond staged short on 1 June 2012

A trader should read this as one written short, not five separate ideas: last 70.78, presell 70.76, protective stop 71.05, then scaled covers at 69.26 and 68.25. Every print is taken from the 15-minute scan-result row under the Bed Bath & Beyond pane, not from tracing the candles.
A trader should read this as one written short, not five separate ideas: last 70.78, presell 70.76, protective stop 71.05, then scaled covers at 69.26 and 68.25. Every print is taken from the 15-minute scan-result row under the Bed Bath & Beyond pane, not from tracing the candles.BBBY · 15 minute · 2012-06-01T00:00:00.000Z to 2012-06-01T00:00:00.000Z

Conservative 15-minute TheWizard presell scan on Friday 1 June 2012. The 50% and 75% prints are the algorithm’s scaled covers on the short.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
36 of 51 in the Momentum strategy track
201215-22 pp.Next on Momentum strategyStacking a relative-strength-index forecast, a trend filter, and long-only momentumA relative-strength-index forecast classifies an implied-volatility-index by comparing the daily-low series with a 50-session lookback average.
All readings on this track · 51 readings
  1. 1984Half-cycle differencing for momentum signals
  2. 1987Relative strength evaluation under competing optimization criteria
  3. 1988Weekly MACD as a two-clock momentum confirmation stack
  4. 1989Equal-weight zero-cross from smoothed spreads
  5. 1989Testing relative-strength-index reversal rules against trend continuation
  6. 1989Smoothed three-day futures filter for index option bounces
  7. 1989Cycle-length windows for momentum, Relative Strength Index, and stochastic construction
  8. 1991Filtered rally magnitude as a bull-regime breakout
  9. 1992Constructing true strength from double-smoothed momentum
  10. 1992Constructing a double-smoothed true strength index
  11. 1993When momentum structure and breadth break together
  12. 1993Constructing double-smoothed range and momentum oscillators
  13. 1993Constructing a two-parameter relative momentum index
  14. 1993Building a bounded momentum oscillator with RSI smoothing
  15. 1993Two-speed oscillators with divergence and trendline gates
  16. 1993Constructing a relative momentum index from the relative strength index
  17. 1994Constructing daily advance-decline breadth tools
  18. 1994Building a composite regime score from monetary climate and weekly trend
  19. 1994Averaging Relative Strength Index and the stochastic oscillator into one reversal oscillator
  20. 1995Dividend-yield regression as a hold versus momentum gate
  21. 1996Jump and hold filters for long-term Treasury yield direction
  22. 1997Constructing extendedness from a 10 percent swing filter
  23. 1997A range-expansion oscillator that can refuse its own stretch
  24. 1997RSI trend permission and Fibonacci pullback rules
  25. 1998Nested midpoint construction for a range-normalized oscillator
  26. 1999Evaluating Relative Strength Index momentum with zero-line and threshold rules
  27. 1999Treat RSI and momentum as three mechanical procedures
  28. 2000Thrust strength figure from moving-average swings
  29. 2001Constructing a non-range-bound balance of market power score
  30. 2004Cleaned breadth oscillator and new-high divergence: a swing-market case file
  31. 2004Evaluating advance-issues-momentum on a fixed-symbol-basket
  32. 2004Constructing a trend filter from two adjacent high-low windows
  33. 2006A dollar-versus-commodity extreme as a regime case
  34. 2008Zero-centered stochastic bands and bracket stops
  35. 2012Evaluating engulfing momentum across hold windows
  36. 2012Staged stops as one mechanical entry and exit procedure
  37. 2012Stacking a relative-strength-index forecast, a trend filter, and long-only momentum
  38. 2013Constructing fair-value filters from averages and momentum
  39. 2014Constructing a multi-window slope divergence entry
  40. 2015Bandedge trend filter construction with inverse crossover rules
  41. 2017Opposite rules for index price and volatility momentum
  42. 2018A three-state overlay that colors a trend only after the line clears the bar
  43. 2018Half-cycle relative-strength index with a Fisher map for cyclic reversals
  44. 2018Emotion as a rule input when momentum breaks
  45. 2018Two-bar body expansion as a momentum breakout construction
  46. 2019Pair a two-day high breakout with a volume-weighted exit on the same chart
  47. 2020Building reflex and trendflex cross and extreme entry rules
  48. 2020Construct a dual-series price momentum oscillator overlay
  49. 2020A multi-timeframe stochastic as a panel of weekly voters
  50. 2020Centerline crossovers that compare index momentums
  51. 2020Multi-timeframe stochastic voting as one mechanical rule
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