Free Friday 9 – Intermarket Signals

In this week’s Free Friday strategy (#9) I display a strategy built using inter-market signals. Inter-market signals/analysis is the ability to generate trading signals and filters for a primary market based on what another market may be doing.

For example, you may only want to buy the stock market when gold is trading lower or when bonds are below their 200 simple moving average.

Build Alpha now let’s you test these exact sort of scenarios and build strategies taking into account up to 3 markets (plus Vix). This specific strategy was built for SPY (S&P500 ETF) but takes into account Gold (GLD ETF) and holds for a maximum of 2 days.

There are no other exit rules or sophisticated risk management; all trades assume only a 100 share position for testing purposes.

The entry:
1. $SPY’s 2-period RSI <= 90
2. Gold’s 50 period simple moving average is greater than Gold’s 200 period simple moving average
3. Gold closed below both its 10 period simple moving average and its 50 period simple moving average

The exit:
Exit after holding for 2 days

For a better explanation of inter-market signals and how to configure Build Alpha to generate strategies based on them please watch this short video I made: https://www.youtube.com/watch?v=CaFRO_gvR-8

There might even be TradeStation/MultiCharts code in the video?!?

Thanks and enjoy the weekend,

-Dave

Thanks for reading,
Dave


4 thoughts on “Free Friday 9 – Intermarket Signals

  1. 1. Do you exit on the close of the seconde day or on the open of the third?
    For exampel if the entry signals occur on third of november and i buy on the open of the fourth. Do i sell on the close of the fifth of november or on the opening of sixth of november?
    2. If the entry signal occur both third of mars and on the fourth do i enter to trades or is it maximum one trade at a time?

    1. Hey,

      1. I believe for this strategy you would exit on close of the second day. I should note that Build Alpha does have the ability to create strategies with exits on either the close or the next open.
      2. Nope, only one trade at a time.

      Thanks for checking out the site,
      David

Leave a Reply

Your email address will not be published. Required fields are marked *