Developing a system for trading in the stock markets

Abstract EN

This research work provides a quantitative approach to measure the accuracy of a buy or sell signals of stocks in the US stock market.

It describes several buy/sell indicators, then measures the accuracy of each indictor by testing it on a number of filtered US historical data between 2000 and 2014.

We show how each indicator weighs, then by summing up scores of successful indicators, we end up with a score for each stock at a particular time.

This would give a much more accurate buy or sell signal.

In past stock market research [Bulkowski, Thomas N (2005), Davey, Kevin (2014), Farley, Alan S (2001), Fitschen, Keith (2013), Stridsman, Thomas (2001), Tharp, Van K (1999)], typically researchers measure the probability of a success of an uptrend or a downtrend based on a fixed number of successful indicators.

For example, some research shows that six out of nine indicators must be giving buy/ sell signals.

The results obtained in this research should be applicable to other international markets as well.