- ago
Hello folks.

What indicator or trading system could be used to non-deterministically avoid larger DD events such as what I mentioned?
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- ago
#1
Enlighten me so it's easier to research. I found one possible solution: Market Sentiment is above Market Sentiment SMA.
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Glitch8
 ( 12.31% )
- ago
#2
You could look for steep, bubble-like, parabolic increases in price. But it's not easy, it's something I've wanted to try and do for a long time but haven't so far.
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- ago
#3
I did quite some research on the topic.
My results so far:
* These crashes are rare events. There is not much data to do any sound statistical analysis.
* Every crash is different. An indicator which seems to predict crash #1 fails in predicting crash #2.

Summary: :(
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- ago
#4
Only careful risk management and avoiding overexposure.
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- ago
#5
By now it appears that all that's said here helps to reduce rare eventual large DD.
A) Market Sentiment vs MA of Market Sentiment
B) Position management (I will experiment with my favorite: "Trading the Equity Curve")
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