This post is the first in a series looking at Pullback trading using the VSTpro.
After testing many systems and indicators, the VSTpro results showed most performed poorly, and required discretionary intervention to save the trade.
Indicators and systems can fool the user into believing good profits can be had, but in reality the signal you see on the chart today may disappear as the chart goes forward.
This type of indicator is known as “forward referencing”. An example of this is shown on the Equis forum. Note the post by “henry1224” and the results in the commentary windows of his two charts.
Equis forum link http://forum.equis.com/forums/thread/34063.aspx
The data tested will be the ASX300 and the best performing sector.
Entry signals will be generated by the VST indicator bands (close cross below MidLine). Exit signals will result from the SmartStop being triggered.
Different “Transaction” costs (brokerage) will be tested, and the results could surprise.
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