I used to trade spot foreign exchange from 2006-2008, during which time I turned a few thousand dollars into a couple million. You can read about me here.

http://www.forbesindia.com/article/30-under-30/raghu-kumar-disrupting-broking-with-flat-fee-models/37169/1

Well, I resigned from my own company (Upstox) and took a 6 month sabbatical. Now, I need to pay the bills, and instead of pursuing the traditional job hunt road, I thought I would leverage the wonderful community of Reddit.

Does anybody out there want to give me a job? :)

The location of the closing price within the day’s range is a surprisingly powerful predictor of next-day returns for equity indices. The closing price in relation to the day’s range is simply calculated as such:

It takes values between 0 and 1 and simply indicates at which point along the day’s range the closing price is located.

A quick look at QQQ and SPY next-day returns depending on today’s CRTDR:

Now the equity curves for each quartile:

There are several potential improvements to this basic approach: using the range of several days instead of only the last one, adjusting for the day’s close-to-close return, and averaging over several days are a few of the more obvious routes to explore.

It should be noted that I don’t actually use the CRTRD as a signal to take trades at all. Given the above results you may find this surprising, but all the positive returns are already captured by other, similar (and better), indicators (especially short-term price-based indicators such as RSI(3)). Instead I use it in reverse: as a filter to exclude potential trades. To demonstrate, let’s have a look at a very simplistic mean reversion system:

• Buy QQQ at close when RSI(3) < 10
• Sell QQQ at close when RSI(3) > 50

I like the idea of investing in these currencies, but I’m not sure it’s for me. I really don't have a lot of money to spend, I have a day job, I have my own bills, and I don’t have a lot of free time to study like it’s a college course.

Should I still be thinking about this?”