When it comes to designing a neural network, inputs are king. It’s kind of like the saying “you are what you eat”. Well, this certainly applies to neural networks as well. If you train your network using “crap” inputs, then the network is doomed before you even begin. The question then becomes, what are good [...]
Due to my background in computer programming, I have always fantasized about designing a program capable of extracting money out of the markets like an ATM. Every time I would train a neural network that was able to accurately pinpoint entries and exits, I thought for sure my day had arrived. Soon after those hopes [...]
In the last article How to find a trading Strategy? Pt.2 we saw that our entry pattern has a small edge over random entries. Even such a small edge, should in theory be enough to develop a fairly profitable strategy. Now we are going to look at a few ways we can improve this entry [...]
In the last article How to find a trading strategy? Pt.1 we found a potentially tradeable pattern. Before moving ANY further, we need to know if this pattern has an edge over random entries.
Testing Metrics
All trades will be for 100 shares. Using the commission structure at Interactive Brokers each direction will incur $1 in [...]
It comes a time in every trader’s career, when you have to stop trading based on your gut, and start trading based on a sound strategy. In this article series, we will start with a basic observation, and try to develop a profitable strategy.
The first step is to look at several stock charts for a [...]