Summary

The article outlines a profitable trading strategy developed by the author using the COT (Commitment of Traders) report, specifically focusing on the fifth indicator from a previous article, and demonstrates its successful application across various financial instruments.

Abstract

The author details a simple yet effective trading strategy that leverages the COT report, particularly the net percentage change of positions, to signal trend-following trades. This strategy, which includes entry and exit criteria as well as risk management techniques like stop loss and take profit, has been tested and applied to multiple trading instruments including Crude Oil, S&P 500, Nasdaq, Gold, Lean Hogs, and Soybean. The results, showcased through various performance charts, indicate substantial profits, with a collective portfolio profit of $127,000 in 2022. The systems based on this strategy have been out of sample for several months, suggesting robustness and reliability for live trading. The article concludes by inviting readers to engage with the author for further information or to purchase these strategies.

Opinions

The author believes in the efficacy of using the COT report for developing profitable trading strategies.
The article conveys that the strategy is straightforward and can be coded simply for implementation.
There is a strong emphasis on the strategy's profitability, as evidenced by the results presented for different markets.
The author is confident in the systems' performance, noting they have been vetted through out-of-sample testing.
The author encourages reader interaction and offers financial advice through various platforms, indicating a willingness to share expertise and potentially sell the trading systems.

Simple profitable strategies with the COT report

How I created 10 profitable strategies with the COT report

This strategy stems from the series that began with the study of the COT report. In the last article:

Trading with COT Report: 5 Indicators

Today we continue the series dedicated to the COT Report, in the previous article that you can find at this link:

algo-trading.medium.com

I said there are a myriad of indicators that can be used for the COT Report.

In this article we will focus on a strategy based on the FIFTH indicator that I showed you in the article I mentioned above.

STRATEGY SETUP

For the strategy I used a TimeFrame daily applied to various underlyings. Coding is simple: - If the net percentage change of positions exceeds a certain threshold, I use it as a signal for a trend follow input.

Example: If ChngInNCNetPctOI (it would be indicator number 5) exceeds a threshold of 5, for example, then I will buy the next bar on the market.

(Classical condition to have only 1 trade at a time)

Once the entry criteria have been defined, I focus on the exit criteria. In this case I rely on a time exit after tot bars, different for long and short entries

And finally I add stop loss, take profit and breakeven.

RESULTS

I have used this simple strategy on a number of tools with excellent results. These that I show you are the results of the systems that I have called with the names of: Ferroust and Poli, they are based on this indicator and they are all in my Trading System portfolio that you can also find in my shop.

This is the list of all the systems I have created based on my studies:

I remind you that all these systems I have created have been Out of Sample for many months and therefore for me they have passed the necessary checks to go live. Here are the results for each system:

Crude Oil

S&P 500

Nasdaq

Gold

Lean Hogs

Soybean

And here are the portfolio results with all systems running:

In 2022, this portfolio would have produced $ 127,000 in profit! Not bad for an indicator that follows the trend of the COT 😉

CONCLUSIONS

This series of articles led us to the conclusion of the Cot Report, we understood what it is, what it does, we studied its indicators and how to use them to make profitable Trading Systems on the market. If you are interested in buying these strategies do not hesitate to write to me!

See you in the next article!

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Financial advice and ideas? Look here 👉 Armando Lo Conte