ninjatrader/strategies/advances-and-declines/README.md

# Advances and Declines

The idea for these strategies comes from chapter 5 (Market Breadth) of [*How Markets Really Work*](https://moshferatu.dev/moshferatu/how-markets-really-work) (2012) by Larry Connors.

As with most of the strategies from this book, they are meant to illustrate certain characteristics of the market rather than be traded directly.

## Rules

### Advances

1. The asset (e.g., SPY) must be above its 200-day moving average.
2. If the ratio of **advances to declines** is at least 2 : 1, enter a long trade.
3. Exit the trade after 5 trading days (~1 week).

### Declines

1. The asset (e.g., SPY) must be above its 200-day moving average.
2. If the ratio of **declines to advances** is at least 2 : 1, enter a long trade.
3. Exit the trade after 5 trading days (~1 week).

## Parameters

**Advances**: The portion of the ratio associated with advances. (Default: 1.0)

**Declines**: The portion of the ratio associated with declines. (Default: 2.0)

**Long-Term Trend Period**: The period of the long-term trend as measured using a simple moving average. (Default: 200)

**Days to Exit**: The number of days to wait before exiting any trade. (Default: 5)

*Whichever of Advances or Declines is greater is what is used as the numerator in the ratio.*

The default settings specify a declines / advances ratio of 2 : 1.

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