Shorting 8 Straight up Days?

In my post from yesterday on buying a condition where 8 consecutive down days have occurred, you’ll notice some thoughtful comments from Damian. Damian thought that testing the opposite condition - 8 straight up days and shorting would be a good idea. Exit criteria are exactly the same only reversed - making a close that is less than previous 2 days lows. Review that previous post for the other conditions of that test. I tested with exactly the same conditions and on the same SP-500 with 10 portfolio slots. Here are the results of that system.

As you can see our performance was pretty poor. As a matter of fact our long only system way outperformed the short only system in the bear market. Now I know where this conversation is going to go next, adding filters such as being under the 200 day moving average. I have been through this before on the old blog. I won’t try to interpret the why this is the way it is. I will just let it stand on it’s own.

Have a Great Day!

Dave Johnson