the short side. Figure 9.1 shows a sample trade in Veritas, using this version of the
system.
Before we move on, it’s also worth noticing that just because an individual
market has a low relative strength, it doesn’t have to mean it’s in a downtrend (or
vice versa). It still could be in an uptrend, but in the midst of a retracement, which
creates the low relative strength as compared to the market as a whole. Because
many of the short-term systems in this book look for retracements before they
enter on a breakout or other type of short-term chart formation, this system or fil-
ter also could work in a contrarian fashion, meaning that we should only look to
enter into stocks with a low relative strength.TradeStation Code
Variables:
{These variables can also be used as inputs for optimization purposes.}110 PART 2 Trading System Development
FIGURE 9.1
Veritas trading using revised RS System No. 1.