Line Your Own Pockets

Should long and short trades be optimized together or separately? This discussion explores directional columns, shared filters, MAE and MFE, stops, targets, time exits, and the tradeoff between profit and win rate. It also covers streamlining AmiBroker code for live signals, reconciling results with backtests, and using AI to automate trading research and operations.

Steve Bravo, a market-data veteran at Massive, formerly Polygon.io, joins the conversation on the fast-changing world of financial data. They explore why Polygon became Massive, how AI is reshaping data platforms and support, and why vendors disagree on prices, timestamps, and bars. The discussion also previews fundamentals, alternative data, Level 2 feeds, extended trading hours, and what sophisticated quants scrutinize.

An automated trader goes live with eight promising systems, only to face losses, flat performance, and mounting doubt. The discussion explores simplifying the operation, choosing dependable backtesting tools, diagnosing shared flaws, handling drawdowns, improving execution, and scaling from tiny positions. A candid look at patience, process, and rebuilding confidence when real-world results lag behind research.

A heated debate pits swing trading against day trading, sparked by the challenge of backtesting a strategy with a “trail forever” exit. The discussion explores outlier returns, systematic rules, buying-power bottlenecks from overlapping positions, and whether trailing components deserve separate testing. They also tackle strategy selection, diversification, opportunity cost, and trader psychology.

Advanced trading success may depend less on discovering brilliant new strategies and more on eliminating costly mistakes. Topics include the limits of endless optimization, why profitable traders should automate execution, how automation exposes hidden discretion, adapting before strategies go stale, testing ideas in live markets, and sharing ideas without abandoning a personal edge.

In this week's episode of Line Your Own Pockets, we explain how to use candle patterns in your trading strategy.Topics covered:Candle patterns aren't magical signals, but that doesn't mean they have no valueInstead of "when does pattern A work?", ask yourself "when does pattern A help my strategy?"Don't get stuck on the exact definition of a pattern (e.g., a hammer) - it's arbitraryThe MabeKit Dojiness column as a good example of a continuous versus binary variable in a backtestAnd much more... ---Before you go!The next time you find yourself in a drawdown, I want you to stop what you're doing and head on over to betterbacktesting.com to sign up for my free backtesting email course.I hope to see you there!

In this week's episode of Line Your Own Pockets, we discuss a question submitted by long-time list member, Matt H., about signal strength.How strong should your signal be when creating a trading strategy?It depends...Topics include:Stronger signals make strategy development easierA weaker signal can be viable, but in this case the filters do more of the workThe more filters contribute towards the edge, the more curve-fitting riskMy favorite strategies are those where the signal is "hiding in plain sight"And much more...No matter where you are in your strategy creation process, you'll get something out of this episode. ---Before you go!The next time you find yourself in a drawdown, I want you to stop what you're doing and head on over to betterbacktesting.com to sign up for my free backtesting email course.I hope to see you there!

In this week's episode of Line Your Own Pockets, we discuss how small changes to your routine can have big impacts on your trading.Topics include:Beware of doing something simply because "that's how you've always done it"Find the most arbitrary assumption in your trading strategy and challenge itHow I recently changed a strategy I've traded for 20 years using this approachIt's good to "get your teeth kicked in" every once in a whileAnd much more... ---Before you go!The next time you find yourself in a drawdown, I want you to stop what you're doing and head on over to betterbacktesting.com to sign up for my free backtesting email course.I hope to see you there!