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Swing Trade and Buying the Dips

Posted by David Bean on

The VIX Swing E-mini S&P has been on a hot streak the last couple of years. It is hard to believe that you can buy the dips on a swing trade basis using this strategy and have less than a 5k drawdown intra-trade and closed trade basis. Those stats alone tell you the strength of trend in the market.

This hot streak is more true of the market than the strategy as there are many strategies that have been hot using this type of approach. On one hand, it is hard to believe that it will continue and always feels like you will jump into a strategy like this as soon as it turns against you. Waiting for a 3k draw down in the strategy to start (which is what we have been doing) is difficult when the base strategy continues to correctly call this market.

On the other hand, no one knows how long a trend like this can last. We to over the longer term results in the portfolio and a way to potentially trade this strategy going forward by using the most recent draw down as your trailing stop loss and risk.

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