What’s NEW?
NEW Key Breakout Pattern
Cool. I've been trading that system (new pattern within Key Breakout) in P30 as well. It's really a good diversifier, and that's why I like it!
Dear Trader,
In my up coming Universal Trader Short-Term Workshop I’ll be teaching a NEW Key Breakout pattern that I released last year.
As you may know Key Breakout is the largest strategy within my Universal Trader’s portfolio of models.
In addition you may or may not know Key Breakout consisted of two patterns.
During my Workshop I’ll be teaching a NEW third pattern I released last year to fit within Key Breakout.
I personally think attendees will come to believe, like I do, that the NEW pattern #3 is a beauty.
Let me give a few insights into my NEW Pattern #3 below.
If you have any questions please do not hesitate to email me at bpenfold@tpg.com.au.
Regards
Brent Penfold
Equity Curve on P24
The NEW pattern, like Key Breakout’s prior existing two patterns, is a simple swing based price pattern.
It only contains a single variable.
And the good news, the variable is the SAME as the single variable already contained within Key Breakout.
So the introduction of this NEW pattern DID NOT introduce a new variable to the overall Key Breakout strategy.
However, while the prior existing Key Breakout patterns had and have a choice of three trade plans, the NEW pattern only has the choice of one … the immediate trade plan.
Accordingly the NEW pattern has an average holding period of only 2.0 days.
Now while this pattern is NEW, the idea behind it, like the idea behind the prior existing Key Breakout patterns, is OLD. :o)
Here’s the NEW pattern’s P24 equity curve.
Contribution
Below are the individual pattern contributions between various trade plans.
As you can see the NEW Pattern #3 is a good contributor.
Robustness – Performance over Indices
As you may know Model “X“, as an individual pattern, is one of my best single strategies.
It’s one of the few patterns I trade over BOTH my P24 portfolio and the indices.
In four short words, it’s simply the best. :o)
My P24 portfolio already contains the North American indices;
- E-MINI SP500
- E-MINI Nasdaq and
- E-MINI Dow Jones
Adding the Asian and European indices boasts my P24 portfolio to P30;
- SPI
- NIKKEI
- HANG SENG
- FTSE
- STOXX50 and
- DAX
Now, let me show you how well the NEW Pattern #3 performs just on the indices.
For those who have been trading for a while will know the indices are a unique specie.
They don’t trade like other markets, constantly back-filling, reversing before roaring off, to only reverse on a dime to stop traders out.
Well not only is Key Breakout Pattern #3 versatile, being profitable over a diverse portfolio, but its also PROFITABLE over INDICES.
In my mind that makes its simply outstanding.
Let’s now see how well Key Breakout Pattern #3 performs on my P30 portfolio.
Woohoo.
As I’ve already said its performance over my P30 portfolio makes it simply outstanding.
It’s so good, that along with Model “X”, Pattern #3 is another one of the very few patterns I trade over BOTH my P24 portfolio and the indices! :o)
Something Special: Combing Model “X” with NEW Pattern #3
There are very few patterns that I trade over BOTH indices and my P24 Portfolio.
As I’ve just said two patterns that I do are Model X and Key Breakout’s NEW Pattern #3!
Their versatility to perform so well over such disparate markets underline both their robustness!
Not only are they robust, but they are also complementary strategies, since;
- Key Breakout’s NEW Pattern #3 is a breakout trend following methodology, while
- Model X is a counter-trend mean reversion strategy
Also, as a side note observation, both strategies have an average holding period of only 2 days.
AND, their combined Ulcer Performance Index of 2.5, giving 2.5 units of return for every 1 unit of risk! :o)
Yours sincerely,
Brent Penfold
Futures Trader
Author
Futures Adviser
Director, Brent Penfold Futures Pty Ltd.