LongHaul

Description

The Long Haul strategy is a going-long-only trading system developed by Donald Pendergast Jr. While this system adds simulated orders based on a common technical indicator, Relative Strength Index (RSI), it also involves thorough selection of the most suitable symbol for the strategy. In order to help you find potential trade candidates, we created the Long Haul Filter study, a thinkScript implementation of Donald Pendregast's stock criteria, adapted for usage in the Stock Hacker Scanning Tool.

When an eligible stock is chosen, the strategy can be applied to it. Since its main principle is "go long only", Long Haul adds only long simulated orders: Buy To Open (long entry) and Sell to Close (long exit). The long entry simulated order is added when the RSI falls below the oversold level but fails to rise above the overbought level afterwards; it is added to the bar that closes above several previous highs and the slow average. The long exit simulated order is added when the close price falls below the fast average. Long Haul also uses a trailing stop: the strategy will exit right after the price drops below the three-bar lowest.

Input Parameters

Parameter Description
fast length Defines the length of the fast average.
slow length Defines the length of the slow average (this number should be sufficiently greater than the fast length).
average type The type of moving average to be used in calculations: simple, exponential, weighted, Wilder's, or Hull.
rsi length Defines the length for the calculation of the Relative Strength Index (RSI).
rsi over sold level Defines the oversold level for the RSI.
rsi over bought level Defines the overbought level for the RSI.

rsi average type

Defines the type of moving average used in calculation of the RSI.

high length Defines the period upon which the high prices are found. Used in checking whether the close price is greater than previous highs.

Plots

Plot Description
FastMA The fast average plot.
SlowMA The slow average plot.

Further Reading

1. "A Trading Method For The Long Haul" by Donald W. Pendergast Jr. Technical Analysis of Stocks & Commodities, 2014, Bonus Issue.

Backtesting is the evaluation of a particular trading strategy using historical data. Results presented are hypothetical, and there is no guarantee that the same strategy implemented today would produce similar results.

Technical analysis is not recommended as a sole means of investment research.

For educational purposes only. Not a recommendation of a specific security or investment strategy.

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