This week's bar closing almost at the bottom of the envelope is the first sign of weakness in over a year. Since this a Weekly time based chart, trading it implies that one is willing to tolerate draw downs up to about 10%. I usually have a position based on this chart and I do now. I will not monkey with it unless/until PA1's background turns gray and that adjustment might be to reduce by up to maybe 50%. The goal here is to stay engaged as much as possible but don't wait around to get creamed like 2008 - 2009. Why not just set a 50% stop and forget about it?. I may be fooling myself but the back-testing I have done indicates this plan is the most profitable while having the smallest draw downs. The most profitable since 2007 to date would have been to just buy and hold but there was a little +50% draw down in there that took a couple years to recover from. For an old geezer like me, I don't like the sound of that. It's probably best to use SPY or DIA for this sort of investing as they pay a dividend. 2/2/18
I may be fooling myself but the back-testing I have done indicates this plan is the most profitable while having the smallest draw downs.
The most profitable since 2007 to date would have been to just buy and hold but there was a little +50% draw down in there that took a couple years to recover from. For an old geezer like me, I don't like the sound of that.
It's probably best to use SPY or DIA for this sort of investing as they pay a dividend. 2/2/18