A weekly two-close breakout and an eight-week time stop

A weekly two-close signal

The archive writes a T-bond and yen futures plan from weekly high, low, and close only. Two consecutive weekly closes above the prior week's high are a buy. Two consecutive weekly closes below the prior week's low are a sell.

The entry is a fully specified weekly-close procedure. A long or short signal is issued only when two consecutive weekly closes print beyond the prior week's high or low, with no chart-pattern judgment. The weekly range-break then follows those two closes and manages the resulting position with the same weekly-close rules.

An eight-week default with three exceptions

The default exit is a time stop after eight weeks. That holding limit closes the position unless a protective weekly close, an opposite signal, or a same-direction re-signal at weeks seven and eight changes the plan.

The three written exceptions are specific. A weekly close through the entry pair's extreme flattens the trade. An opposite two-week close signal reverses the position. A same-direction signal on weeks seven and eight restarts the eight-week clock.

The T-bond long and its protective close

In the worked T-bond example, weeks with closes of 99-16 and 104-20 each exceed the prior week's high, so the long is taken at 104-20. The trade is flattened if a later weekly close prints below 88-00, the lowest price of the two signal weeks.

The yen walk-through uses every exception

The 1982 yen walk-through shows all three time-stop exceptions. A buy is taken at 0.4713. After two weaker weekly closes the position reverses to short at 0.4625. A sell signal at the eighth week keeps the short open and restarts the clock.

Why eight weeks is preferred

The eight-week default is presented as the preferred holding period after a fundamental-driven entry, on the view that later participants have already joined and the move then tends to stall or reverse. Five-week and ten-week exits are described as workable but inferior.

Write the plan without pattern judgment

The author argues that systems should be written without discretionary pattern judgment and must be tested across both volatile and quiet historical regimes. Many breakout rules that looked profitable in late-1970s and early-1980s volatility produced large losses in early-1990s quiet markets.

Market selection is treated as part of the procedure. Concentrate on a few markets whose character is understood rather than applying one breakout rule across all futures, and do not expect the same weekly two-close signal to transfer cleanly to markets such as silver or soybeans.

A mechanical plan is valued because it specifies when to exit or reverse, removing the need to second-guess an open position after the entry signal has already been taken.