Over the past few weeks, the good folks at iBC have been busy backtesting different strategies using the overall PPT Hybrid Overbought/Oversold scores. We wanted to build a system that is easy to understand, without too many rules, one that is easy to follow along at home.

The results were nothing short of mind blowing. What if I told you that you could be up 70% for the year just trading $TNA based upon some numbers spit out by the godly PPT algorithm? Don’t believe me, click here for the data.

The system is easy to understand. When The overall hybrid score, located inside The PPT, closes oversold (ie. below 2.46), you will buy your first tranche ie. 1/3 position in $TNA. Upon reaching another oversold signal on a closing basis (<2.46), you load your 2nd tranche (another 1/3 $TNA). And, finally, if you get a third closing oversold signal before an overbought reading, you load your final tranche (1/3 $TNA, giving you a full position). Should you get a 4th signal, you must sit tight.

Once you have your position, you now wait for the Overbought signal to take place (>3.10). When the overbought reading is reached on a closing basis, you sell the whole position and immediately go short using the same 3 tier system. Rinse and repeat.

Here are some results from a few ETFs and select equities we tested, using the 3 tier system. Click here for results.

Note: The first row contains what your account value would have been should you have invested 100,000 to each position since the inception of The PPT.

Here is the breakdown of the $TNA trade since the inception of The PPT: Click here for data