THE FLIPPER
What is The "Flipper"?
The "Flipper" is moving average, trend following, mechanical system. Buy and sell signals are automatically generated by a mechanical trading system triggered by a moving average's direction movement. The "Flipper" was designed to take advantage of long, directional moves. It is the epitome of a trend following system. The "Flipper" sacrafices a high winning percent to allow it to participate in major market moves.
How does your mechanical trading system work?
The mechanical trading system has predefined trade entry and exit rules. At various hourly, intraday, market closes, prices and proprietary indicators are evaluated to identify whether entry or exit conditions have been met. The system uses market-on-open orders for the next trading hour, to close open positions and enter new orders. All trade signals are generated by the trading system and no part of the system is subjective.
Entry conditions are signaled when a moving average changes direction. A buy or sell signal is generated when price causes the moving average to change direction. In this case, the "Flipper" (the selected moving average) is also the trend identifier. Exit conditions are triggered when a moving average reverses its direction.
What are the advantages of mechanical system trading?
The primary advantage of system trading is that it provides investors with an unemotional, rules-based, decision-making process. The benefit is that a rule based decision making process can be tested against historical price data to determine profitability. Subjective approaches cannot be tested; and, therefore, cannot be proved or disproved profitable. Another major benefit of a mechanical approach which uses technical indicators, is that investment decisions are not influenced by rumor, poor fundamental analysis, news, or questionable accounting practices. Human emotion, consistently cited as a major contributing factor to poor investment performance, is eliminated.
What indicators do you use?
The "Flipper" system indicators are NOT proprietary. We use a variety of moving averages. We use simple moving averages in many of our approaches. By far, our favorite adaptive moving averages are Tim Tillson's T3's.
How should the average investor use the trade data?
Our goal is to help average investors trade high-probability opportunities in futures markets and to help manage existing positions by providing short-term market signals to improve on exits and entries. We have found that the "flipper" data has been used by our clients in many ways. Most importantly, we ALWAYS recommend that traders should only trade in the direction of the trend. The "flipper" can be used as a filter for other mechanical systems or simply can define the direction of the market.
Do you employ stops or money management techniques?
Yes, we use both stops and money management techniques. With the grains, interest rates and indices, we do NOT use stops (using various "Flipper" approaches). The hourly "flipping" creates a short time committment to each trade. Average investors are encouraged to use the system in conjunction with their own risk management requirements.
What universe of futures do you cover?
The "flipper" is being traded, "live"...in the Hotcomm room: "Teach-talk-trade", with the grains, indices and interest rate futures.
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