Turtle trading is a renowned trend-following strategy used by traders in order take advantage of sustained momentum. It looks for breakouts to both the upside and downside and is used in a host of financial markets.
Markets traded: the turtles traded futures contracts, looking for highly liquid markets that would allow them to trade without moving the market without a large order.
Entries: two different entry systems were used. The first used a simple 20-day breakout, defined as a 20-day high or low, or a 55-day breakout. Winning positions would be added to, up to a maximum of four entries.
Stop losses: the turtles were taught to use stop losses at all times, in order to ensure that losses did not become too large. Crucially, they determined their stop loss before they entered the position, defining their risk before the trade was placed.
Exits: The system one exit rule was a 10-day low for long positions, and a 20-day high for shorts, while system two utilized a 20-day high or low. They did not use stop exit orders, but watched the price in real time.
Try it out on different time frames, find the best on for your asset and enjoy trading!
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