Dual Thrust Breakout Rules and a Daily Stock Adaptation

Summary

The document explains the Dual Thrust trend-following system, which defines a recent trading range from the largest of two high-to-close and close-to-low spreads. It sets upper and lower trigger levels by adding scaled versions of that range to a reference opening price. A move beyond either threshold signals a position change: the system closes an opposing position and enters in the direction of the breakout.

The author adapts the idea to daily stock trading, using historical data to calculate the range and a prior opening price as the reference. The proposed stock version buys on an upper breakout and describes exits based on short-term declines or a broad-market stop. The post says intraday backtests were slow and leaves its exit comparisons loosely specified. It offers a rule outline rather than performance evidence, and gives no parameter evaluation, transaction-cost treatment, or risk-adjusted results; the original two-sided futures-style rules and the stock adaptation should therefore be treated as distinct implementations.

Key ideas

• Dual Thrust sets breakout thresholds using a recent range derived from highs, lows, and closes.
• A scaled range is added to a reference open to form upper and lower trigger levels.
• The standard rule reverses direction when price crosses the opposite threshold.
• The stock adaptation focuses on buying upper breakouts and adds decline-based and market-based exits.
• The document does not provide backtest results or a systematic method for selecting parameters.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.