Rex Leonum is a custom indicator to assist in trading decisions that tracks trending trades. This indicator is a blend of 9 indicators commonly known in the financial market:

Moving Average: Moving average is a statistical tool used by traders to analyze price trends over a set period of time. It takes the average of a series of prices over a certain specified period, in our case, the past 10/20/30 days, and then plots this average on a chart. By doing this, we spot potential buy and sell signals based on the direction of the moving average. When the moving average is increasing, it is a sign that a Futures Contract’s price is on the rise and is a potential buy. On the other hand, if the moving average is decreasing, it is a sign that a Futures Contract’s price is decreasing and is a potential sell.

Exponential Moving Average: An exponential moving average (EMA) is a type of technical indicator used in trading that is typically used to identify potential entry and exit points. The EMA gives more weight to more recent price points, rather than the standard moving average which evenly distributes the weight across all data points. The EMA's calculation starts by determining the simplest moving average for a given number of days (a 7- and 14-day EMA). From there, the exponential factor is determined by the calculation (2/(number of days + 1)). Then, the EMA is calculated by adding the exponential factor multiplied by the price difference between the current period and the previous period moving average. We use the EMA to determine which direction a contract is moving and/or when it is in an overbought/oversold situation. We use it in conjunction with other indicators to more accurately gauge the direction and momentum, as well as a trend direction indicator. If the EMA crosses the moving average, it is taken as a signal to enter or exit a trade for this indicator.

MACD (Moving Average Convergence Divergence): A trend indicator that displays the relationship between two moving averages of prices. Moving Average Convergence/Divergence (MACD) is a technical analysis tool measures the relationship between two moving averages of a Futures Contract's price. The MACD line is calculated by subtracting the 26-day exponential moving average (EMA) from the 12 EMA. The 12-day EMA acts as the fast moving average, while the 26 day EMA acts as the slow moving average. The signal line is then a 9-day EMA of the MACD line. We use the MACD to measure momentum and gauge trend direction. By plotting a Futures Contract’s prices against the MACD, we identify extreme price levels. If the MACD line crosses above the signal line, then the Futures Contract may be entering an upward trend. Conversely, when the MACD line crosses below the signal line, then the Futures Contract may be entering a downward trend. We watch for the following crossovers as confirmation of trend change: a bullish crossing occurs when the MACD line crosses up and over the signal line and a bearish crossover occurs when the MACD line crosses down and under the signal line.

MACD 4C: The MACD 4C is a trading strategy developed by Thomas Aspray. It is based on the Moving Average Convergence Divergence indicator, which is a trend-following momentum indicator designed to identify when a Futures Contract is overbought or oversold. The 4C of the strategy stands for ‘crosses, crossovers, convergences and divergences’, and it allows for traders to identify a new trend or an imminent reversal in the current trend. By taking into account the overlapping of moving averages and the slopes of their respective trends, traders can find good entry and exit points for trading. The MACD 4C trading strategy helps traders to identify the direction of the trend and take advantage of price reversals. The first step is to plot the MACD indicator on the chart and identify the crossovers of the MACD and Signal lines, which signals an upcoming trend change. Next, we look for convergences and divergences between the MACD and price trends. If the price trend is pointing upward and the MACD is heading downward, this means that the current trend is about to reverse, and we take this as a signal to close their long positions and open short positions.

RSI (Relative Strength Index): RSI (Relative Strength Index) is a technical indicator that is an oscillator that measures the speed and change of price movements of a Futures Contract over a given period of time. The index moves between 0 and 100 and is used to gauge whether an asset is overbought (above 70) or oversold (below 30). We use the RSI to help predict potential reversals in the Futures Contract's price trend. When the RSI is overbought or oversold, it is an indication that the Futures Contract is in potential reversal phase: If we see the RSI get overbought, we take a short position; if the RSI is oversold, we take a long position. Another way we use the RSI is to look for signals of divergences between the indicator and the price action. This happens when the indicator is either diverging or converging with the price, and can is an indication of a reversal.

Stochastic Indicator: The Stochastic Indicator is a technical indicator based on the idea that prices close near the high or low of the range when the asset is trending. It provides a range of information such as the current price range, its strength, and its momentum. This indicator is used to identify potential turning points by measuring the degree of directional movement in the asset. We use the Stochastic Indicator to analyze the market momentum of an asset and decide when to enter and exit trades. We set a high and a low parameter for the indicator based on the previous day's range, and we will take it as a long or short indicator when the price reaches these levels. We also monitor the strength and momentum of the trend to take advantage of short-term opportunities in the market.

Volume: Volume is a measure used to track the amount of a particular asset that trades each day. We use it to understand the strength of a market and its underlying trend. If the volume is high, then it suggests that investors are buying and selling more frequently and with greater conviction. Conversely, if the volume is low, it suggests investors are less interested in the asset and may be losing confidence. Volume is an important tool for us to gauge current market sentiment and gauge future trends. It is also used to make buy and sell decisions by comparing current volume to average volumes over a specific period of time. This can be a useful way to identify potential trading opportunities.

Retraction in relation to ATH (All-Time High): The ATH is important for us as it indicates the upper price ceiling and therefore can be used as an entry or exit point. We will take a sell position as soon as the price hits the ATH, after experiencing an uptrend. After the Futures Contract is sold, we monitor the retraction percentage to determine when the price is likely to hit the support price, and potentially reverse its course if it drops beyond the expected percentage from the ATH.

High Volume Areas: Areas of high volume artificially create support and resistance levels to trades attempting to go through them. As barriers, they help to identify the opportunity and length of prospective trades.

Each of these indicators are set to be either trending up (“green”), trending down (“red”), or indecisive (“yellow”).

If all indicators are green, a “long” position is taken.

If all indicators are red, a “short” position is taken.

We do not set a specific Take Profit (TP) or Stop Loss (SL) in the program, as the strategy is based on identifying trends, in a method called Trend Following. Trend Following is a strategy that seeks to capture gains through the analysis of an asset whose price is moving strongly in a particular direction. In this context, trades can vary in duration, ranging from a period of seconds to a few hours, but it is designed to be back in a cash position by end of trading day.

So long as the indicators remain strongly in either direction, the trend will continue. As the indicators reverse, the position is closed.

Risk management is modified based on the win/loss daily rate, as well as any additional parameters the trader would like to put on.

The trend line itself serves as the stop loss (SL) or take profit (TP). The the risk-reward ratio is set to start at 1:1, and immediately move average 2 to 1 once it passes breakeven. The stop or TP will trail if the price moves in the predicted area of the trade, locking in larger profits and larger rewards for the risk.

The indicator does not identify a large number of trades daily, even weekly. Instead, it seeks to identify when all the indicators that make up our system are in sync and pointing in the same direction.

One of the main benefits of trend following is that it doesn't require traders to predict or forecast specific price levels; rather, it simply involves identifying the direction of a trend and trading in alignment with it. This strategy can be applied over any time frame - short, medium, or long term.

The algorithmic trade signals provided by the software are exclusively executed by Capital Trading Group. For more information on the partnership with CTG, click the tab below titled “Partnership with CTG.”

The software is exclusively offered as a Letter of Direction product. For more information on LOD and how it works, click here.

Rex Leonum is offered exclusively in LOD partnership with CTG. All trades are executed by the professional team at CTG.

Started in 2007, Capital Trading Group, LLLP (“CTG”) is an investment firm that believes safety and trust are the two most sought after attributes among investors and money managers alike.

With team members having experience of over 30 years, they have built their business and reputation in efforts to mitigate risk through diversification.

They focus on forging successful, long-term relationships with their investors.

For more information on CTG, click here.

As a LOD program, purchasing Rex Leonum requires availability of licensed “seats” in a Rex Leonum tranche.

For more information on availability, and to sign up, click here.