Today we discussed how to find hidden relationships between trading instruments by scanning for correlation. Attached is the discussed strategy. If you haven't seen it, I strongly encourage you to watch the video in the Video Archive, where I try to explain in down-to-earth language what Correlation is and how you can use it. It's a powerful tool to have at your disposal to find underlying relationshipps that aren't immediately obvious!
The video explains everything in detail, but to summarize, I've included the following description in the exported strategy:
Correl Scan Intraday:
Identifies correlations for stocks A and B at the specified threshold. Correlation values range from -1 to 1, where:
1 is a perfect correlation (meaning A and B are identical),
0.8 is a very strong correlation (meaning A and B move with each other),
0 is no correlation (meaning A and B have no relationship),
-0.8 is a very strong anti-correlation (meaning A and B move in opposite directions),
and -1 is a perfect anti-correlation (meaning A and B are identically opposite).
Simply right-click the attachment below and "Save As" to your computer, then "Import" into your Wizard Lab Step 2 - Strategy Builder.
Great Trading and see you next week!
-Bryan
| Attachment | Size |
|---|---|
| Correl Scan Intraday - Strategy.wiz | 3.14 KB |
Back testing engine not firing when it should. I have a chart showing the engine should have fired a signal the 16th 2011. It did not. This is a very simple Ballinger bandwidth set up. Looking for the CLOSE to be greater than the upper Bollinger band for a signal to fire.
If you are interested will be glad to send anything you might need to verify the statement.
Chuck