Eugene Nofri - Congestion-phase System


Most markets spend most of their time going sideways in narrow, non-trending, trading ranges known as congestion phases. Hence, a method that takes advantage of this tendency should show a high percentage of winning trades. Eugene Nofri, waits for a well-defined trading range to develop, then it fades the close after two consecutive directional days. This position is closed one day later, on the third day's close. That is,after two up days in a row, we sell short on the close, and we cover our short on the next day's close. Also, after two down days in a row, we buy on the close, and we close out our long position by selling on the next day's close. Many refinements and filters on top of this basic system are possible. For example, to produce fewer trades, defer action until the third consecutive directional day, and close out the position on the fourth day's close of trading.





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