The reason why I looked into and developed a medium-term trend trading methodology was to help diversify my results following IndexALERT’s poor performance during 2007.
By March 2007 IndexALERT was into its 6th month of drawdown and that got me thinking about looking at a different form of trading that would not duplicate but compliment my short-term trading, and help me stay out of drawdown overall…so I thought a medium-term timeframe (as opposed to my short-term) and trend trading (as opposed to much of my predominant short-term swing trading) should compliment my existing trading and diversify my results …. Particularly as I believed the continuing bull market in equities at the time caused a contraction in market volatility that impacted IndexALERT’s results. So I got thinking about developing a medium-term trend trading methodology that if it had legs would have an equity curve that would compliment my short-term trading results.
In addition I also wanted to develop a methodology for forex to further diversify my reliance on index trading.
It wasn’t until mid 2007 that the ideas of BBTT and Key Level developed in my head, and it wasn’t until October and November that I had been able to program and prove the ideas and watch them live for a few months to see them working well in real time. And I had hoped to start trading them in December 2007 …. But decided not to since I usually shut down by the second week of December.
So BBTT and Key Level came about as I wanted to have another methodology and market that was different and complimentary to my existing short-term index swing trading….to diversify my results …and I believe I have achieved it.