The Trendfinder first started back during the summer of 2009 as a project to help discover and quantify the current market trend. It was also designed to help determine more profitable entries, clinic exits, and stops. The first model used higher highs, and higher lows to locate up-trends. I still use this method today to help identify important levels of support and resistance. A significant weakness with this system however, was the inability to determine the significance of past lows. This is how the Trendfinder first became intertwined with Elliott Wave Theory.
Integrating Elliott Wave theory into the Trendfinder model provided a quantified meaning to those higher lows by providing a labeling system and a set of rules for the way the waves of price action behave. Since the low of a wave 4, is not as important as the low of a wave 2, price action that dips below a small 4th wave correction, could be explained as a 2nd 4th wave of a wave sequence one degree higher. Such price movement follows Elliott Wave principles and would not be considered significant; however, the price action that falls below the previous low of a 2nd wave would be an important event.
It was in the early in the fall of 2009 that Anchak, a great friend, and mentor, stepped in to help out with ideas and suggestions on ways to improve the trendfinder model using his proprietary indicators. Anchak, heavily schooled in advanced math and statistical data research was already building his own set of indicators, and with his help the Trendfinder exploded to life. Anchak was able to take my ideas, fine-tune, and tweak them to optimize the indicators that we were building.
The Trendfinder II has been a project based on many hundreds of hours of research but it is still a work in progress. We are looking for that perfect tool that catches 100% of a trend without whip-saws. One thing we learned very early on is that there is no such thing as the “Holy Grail” of market indicators. We’ve found that there is a give and take that requires a choice between giving up a little of the trend for the sake of less whip-sawing, and capturing more of the trend but having to deal with more volatility in price action. The Trendfinder II has been tweaked to grab as much of the trend as possible while keeping the whip-sawing to a minimum. These final tweaks were based on extensive back-testing of different indexes and time frames.
In late 2010 I started sharing the signals generated by Trendfinder II on the blog and in early 2011 I was able to program an oscillator to gauge the strength of the signal. I expect that this system will always be a work in progress, but I have yet to find any other system currently available on the market that can out-perform it.
The Daily trends are updated every day after the close, and if there are any important changes during trading hours they do get tweeted. The Weekly trends are updated during the week-end in time for Monday’s open.
All updates can be viewed by Clicking here!!!
The Trendfinder II is still a work in Progress indicator we are only presenting the results of this study for educational purposes. The materials on this website do not constitute offer or advice and you should not rely on the information here to make or refrain from making any decision or take or refrain from taking any action.