DYNAMIC - A SWING TRADING SYSTEM
Motivation
The momentum feature is well known and researched in the market. Momentum trades/signals often result in out sized positive returns when trades go well in their favor. At the same time, almost all momentum methods/signals suffer from frequent, small and multiple losses.
Dynamic indicator/system is a proprietary systematic method designed to capture momentum on Indian Indices of NIFTY and BANKNIFTY
It aims to identify bullish / bearish patterns in a systematic manner and uses volatility adjusted entry levels and trailing points. The method employs a proprietary method to filter out market noise from an underlying trend to ensure whipsaws arising from a trend-following method are removed.
The expected outcome of using this is to improve risk adjusted returns on Nifty and Bank Nifty.
Trade Usage
The indicator can be used either as a standalone indicator/method or can be used as an additional confirmation to user’s Long/Short method.
Time Frame
The edge plays out on all time frames. Most common being 30/60 Minutes for Swing Trading with holding periods of a few days to weeks and 5 Minutes for Swing Trading with holding periods of a few hours to a couple of days.
Trade Usage
The indicator can be used either as a standalone indicator/method or can be used as an additional confirmation to user’s Long/Short method.
Elements of the indicator
BUY/SELL markers - They depict the BUY/SELL at the open of that bar. The set up is ready at the bar prior.
Trail SL Marker - Current SL of the system. Often times the trade would exit or reverse if market conditions have changed, even before hitting SL.
A ready BUY set up is depicted by Green vertical bar. A ready SELL set up is depicted by Red vertical bar.
Example Chart:
Back Test Performance
The initial Backtest was conducted on TradingView PineScript and following are the results:
NIFTY
Time Period: Jan'14 - Nov'20
Chart Time Frame: 30 Minute Time Frame
Strategy gained 10811 points(vs Nifty points 6700) and a draw down of 1158 points (vs Nifty draw down of 4900 points)
BANKNIFTY
Time Period: Feb'2009 - Nov'2020
Chart Time Frame: 60 Minute Time Frame
Strategy gained 31529 points(vs Bank Nifty 25000 points) with a draw down of 4921 points (vs Bank Nifty 15,000)
GET TRADINGVIEW ACCESS
AUTO/ALGO-TRADING
DYNAMIC Signals on 5 Minute Time frame can now be automatically executed on your trading account. The strategy is Live on Tradetron, which is an algo trading marketplace. Below are strategy statistics for period of Jan-2020 to Jan 2021. LIVE performance from thereon can be viewed on Tradetron Strategy page. iIt has two versions:
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Futures Version - Trades Long/Short on Nifty & BankNifty futures
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Options Version - Trades Long Calls/Long Puts on Nifty & Banknifty Weekly Options
