Advanced Trend Reversals – An Explanation
What is an Advanced Trend Reversals (ATR)?
The ATR is a “Golden” level with a very high probability statistically with an accuracy rate of almost 80% of the time for the market to change its course of direction almost immediately either from Bullish [going up ] or to Bearish [going down], and to have a follow-through in price action to that direction.
The bias of the algorithm would remain as long as that the proprietary indicator has not been penetrated through e.g. it would remain Bearish as long as the Market has not closed ABOVE the Indicator Level, and it would remain Bullish as long as the market has not closed BELOW the indicator level.
The ATR report is an extremely dynamic proprietary indicator, the report is generated after the close of the NYSE and the NASDAQ.
The report covers the top U.S. stocks including the FAANG stocks, these are the most active stocks on NASDAQ
the companies that belong to FAANG are:
FB – FaceBook
AAPL – Appl Inc
AMZN – Amazon.com, Inc.
NFLX – Netflix, Inc.
GOOG – Alphabet Inc.
As you can see the group FAANG is self-explanatory!
here is a screenshot of Faang which you can click to enlarge:
The ATR report will generate a price level and a bias either “Bearish” showing that the direction of the market would be “Down” or a “Bullish” trend showing that the direction of the market is “Up”.
The significance of the Advanced Trend Reversal Price Level is that the level where the market would change its the course of direction (meaning would change from) Bearish to Bullish, or the other way around Bullish to Bearish if the price level of the markets changes the course of direction.
To clarify the table above , on the close of business date Dec 26th 2018 , the ATR has generated a BULLISH signal for trade date Dec 27th 2018 , on AMZN Stock, its core position is SHORT since Dec 12th2018 from $1,680.60 as shown, which means, the Stock has to penetrate and close above the Bullish Signal at $1,460.14 to change from Bearish to Bullish, hence the Reversal order for trade date Dec 27, 2018, at $1,460.14 .
The ATR Price Level, Bearish, this means the Price Level would be above the close of the market, which shows us it is currently in a Short Position, for example, it has sold the Stock Previously and it’s trailing Reverse Stop is at the Indicated Price Level of the report. SO, as long as the market price doesn’t close above the ATR Price Level it would remain Bearish.
A trader using the ATR indicator would systematically keep him or her in a well-defined market condition. A bullish condition in going up or in a Bearish market condition in going down and capturing at least 75% of the market move before it reverses its position from Short to Long or from Long to Short. The Advance Trend Reversal indicator is most effective in Volatile and Directional Market conditions.
However, It is not useful in quiet market conditions, as it could get whipsawed back and forth in the quiet market conditions. It is therefore recommended for users to enter their daily Reverse orders at 15:45 New York time.
The ATR algorithm does monitor closely price Volatility and therefore it would prompt users to enter their Reverse Orders either 1 Hour after the opening at 10:30 NY Time or 15 Minutes prior of market close, which would be indicated on the Top Right Corner of the Daily Reverse Order Sheet.
Click to enlarge the image:
The ATR – Advanced Trend Reversal Indicator – Symbols
Above is the symbol indicator of the information that we provide on the ATR
- The Stock Symbols
- Entry Date
- The current Position, Long [ bought ] or Short [ sold]
- Number of Shares
- The Entry Price,
- Current Price as of the Close of the Market Price for the particular Stock,
- price as of the Close of the New York Stock Exchange
- Open Equity – is the Performance of the Open Position in relation to Entry Price Less the Closing Price expressed in Percent;
- Reverse Orders (execution) for trading date is the Price Level where to reverse the Present Open Position from Short to Long [ e.g. if Short 100 stocks, you need to Buy 200 stocks, i.e. assume profits on the open position and go long 100 shares and the Opposite is also true, meaning, If Long [ you Bot previously] you need to Sell the existing position and go Short [ the same quantity].
- Do enter this order usually approximately 15 minutes before the market closes.
Click to enlarge the image to see all results:
Risk and Disclosure Statement:
“There is a risk of loss in trading stocks, commodity futures, options contracts, and forex. This risk can be substantial and therefore investors should carefully consider their financial suitability prior to trading. Investors must fully understand the risks involved and must assume the responsibility for the results. Past performance is not necessarily indicative of future performance. In no event should the content of this website be construed as an express or implied promise, guarantee or implication by or from, Strategic Analysis Indicator or its affiliates, that you will profit or that losses can or will be limited in any manner whatsoever? Information provided on this website is intended solely for informative purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed and is provided as a courtesy only. Our products are provided solely for educational purposes and in no way should the comments or strategies discussed be considered a solicitation to buy or sell commodity futures, options, securities, ETFs, Forex, or any other financial instrument. Therefore, we do not provide personalized trading advice to individual subscribers and you should contact your brokerage firm directly for assistance specific to your account risk tolerance and capital. Examples of historic price moves or extreme market conditions are not meant to imply that such moves or conditions are common occurrences or are likely to occur.”
“STOP LOSS ORDERS DO NOT NECESSARILY LIMIT YOUR LOSS TO THE STOP PRICE BECAUSE STOP ORDERS, IF THE PRICE IS HIT, BECOME MARKET ORDERS AND, DEPENDING ON MARKET CONDITIONS, THE ACTUAL FILL PRICE CAN BE DIFFERENT FROM THE STOP PRICE. IF A MARKET REACHED ITS DAILY PRICE FLUCTUATION LIMIT, A “LIMIT MOVE”, IT MAY BE IMPOSSIBLE TO EXECUTE A STOP LOSS ORDER.”
“THE RESULTS SHOWN ARE BASED ON SIMULATED OR HYPOTHETICAL PERFORMANCE RESULTS THAT HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE THE RESULTS SHOWN IN AN ACTUAL PERFORMANCE RECORD, THESE RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, BECAUSE THESE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THESE RESULTS MAY HAVE UNDER. OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED OR HYPOTHETICAL PROGRAMS, IN GENERAL, ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.”